You are thinking about setting up a German-Indian joint venture - but what do you think? the right joint venture partner other than by chance?
The ideal Indian joint venture partner will not come across you by chance. You don't meet him at a trade fair or get to know him spontaneously at a business event. You can't judge the quality of your potential Indian partner from their highly professional company website or their charismatic appearance.
Finding the right partner for your company is a hard task that requires patience, technical and cultural expertise and a reliable professional network.
1. Obtaining relevant background information
Obtain extensive background information on potential joint venture partners.
The crucial difference between the search for a suitable joint venture partner today and the search for a partner just 10 years ago is the transparency of relevant data and thus the possibility of obtaining reliable information about the targeted partner. Not only is information from Indian registry courts and thus financial and corporate data now publicly available, but background information relevant to decision-making is generally easier to determine.
On the one hand, database research, obtaining information via European networks, market analyzes and reputation queries are important tools available for selecting reputable partners.
On the other hand, Indian companies themselves have changed. Unlike a few years ago, potential Indian joint venture partners today are generally no longer “over-euphoric newcomers” with the resulting difficulties [see: "The “Super Indian” as a joint venture partner"].
Indian companies now often already have international (export) experience or have already failed with a European-Indian joint venture. The resulting background information that is of interest to you can then be accessed.
Indian companies have often already gone through a so-called “valley of tears” and are therefore more willing to talk about problems. In the past, numerous Indian companies had to experience the painful experience of not being able to meet the quality requirements of their export products on international markets due to a lack of international experience, and the extremely cost-intensive rework made calculated profit expectations impossible. They had to realize that their marketing strategies did not reflect international consumer wishes, that their cultural business practices differed from European customs, and that their self-assessment was often, unfortunately, an overestimation.
The cultural change that has now occurred towards more transparency is also reflected in the increased willingness to seek assistance from external consultants.
Indian companies are more mature today, their technological learning curve is currently larger and much faster than in Europe. The delta between technological progress in Europe and India is getting smaller every year. This means that Indian companies have become more predictable as potential joint venture partners for German companies.
In addition, Indian companies today mostly focus on targeted strategic interest rather than opportunism. One reason for this may be the “generational change” that is (also) occurring in Indian corporate society; The founding generation passes on to their successors and would like to leave their “global footprint” until then.
Furthermore, the probability that you are the first and only person interested in cooperating with a particular Indian company is low. The demand for joint venture partnerships is currently very high in India, so that Indian companies have already gained experience in finding partners from European companies and their business practices, wishes and goals. They know what the European partner expects of them and what requirements are placed on them.
2. Personal contact
Get to know the targeted partner company personally on site and speak directly to the responsible decision-makers.
“India is far away” – it is difficult to assess a potential joint venture partner from a distance. Invest the time and effort to establish personal contacts with the actual decision-makers of the Indian company. Visit factories on site and look at production processes, quality standards and the corporate culture in India itself.
3. Obtain expertise
Get professional support.
Despite the increased data transparency and the better flow of information, the search for a suitable, reputable and reliable joint venture partner for your company remains a highly specific task. A robust network, years of on-site experience and a deep understanding of the Indian market require expertise. To ensure a successful start, do not be afraid to seek support when looking for a partner. We enable long-term and sustainable success of your cooperation because we bring precisely these skills. After 20 years in the India business, we know what is important.
