Hong Kong companies urged to go international to survive

Hong Kong companies doing business abroad have stouter bottom lines and better profits than those relying solely on the home market.

The just released Regus Global Survey said these findings indicate that foreign expansion is good for Hong Kong firms and should be considered urgently by companies that do not want to be left behind in a fiercely competitive market.

Regus polled 12,000 companies around the world, including over 100 in Hong Kong, for the survey. The company is a leading provider of workplace solutions that include fully equipped offices to professional meeting rooms, business lounges and a broad network of video communication studios.

According to the survey, 75% of responding Hong Kong companies intend to expand in foreign markets compared to 59% in China, 43% in the U.S.A. and 58% globally

"This report provides hard evidence that, in the current economic climate, Hong Kong firms who have diversified overseas are faring better than those who have stayed with their home markets said Hans Leijten, Regus' vice-president, East Asia.

"This applies to companies both large and small and should act as a wake-up call for those still solely focused on domestic markets to find effective and cost-efficient ways of moving cross-border in order to enhance their earnings and spread their risk. In Hong Kong, where exports experienced a decline in November 2011, these results may be seen as a call to action."

Among the survey’s other findings about Hong Kong firms:

• 39% Hong Kong respondent firms say the biggest obstacle to overseas expansion is the challenge of setting up a physical presence in a foreign country, compared to 37% in China, 34% in Japan, 29% in the US and 34% globally
• 65% of Hong Kong companies also say that property commitments have to be very short term when setting up a foreign operation, as they do not know how quickly or slowly they will grow, compared to 66% in China, 56% in Japan, 56% in the US and 63% globally.
• 29% of Hong Kong respondents demand local language fluency, compared to 68% in China, 35% in Japan, 38% in the US and 48% globally.
• 90% from Hong Kong, 88% from China, 81% from Japan, 76% from the US and 81% globally believed that local staff is essential when setting up foreign operations.

Hong Kong respondents said property and people are key perceived obstacles to international expansion.

The full global report, entitled 'The Export Imperative' can be downloaded from www.regus.presscentre.com.

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Tags: Regus Global Survey, Hong Kong