Frederick R. Andresen » Starting a Business in Russia~How is it Different?

Starting a Business in Russia~How is it Different?

"The Barge Haulers" Ilya Repin

“Doing business in Russia is like doing business anywhere else…but different.” Business is business, many think. Yes and no. How is doing business in Russia different from, say, the United States? Here are five points I can make—there are others.

Get a partner. You are in a foreign country and you need a good partner as you would a guide to climb a mountain in The Himalayas. This is the hardest thing to do, since this decision may well tell the future for you. So take time. Visit, meet, talk, listen, listen more, get advice from trusted sources, and wait. Even if you have privately decided, let things cool off and don’t jump to conclusions. Often something will surface to add substance to your decision. Check him or her out. Know the family and their connections.
Listen to the partner. You must hear the story from the Russian perspective. Ask questions. Listen to the answers. Ask the same question another way. Listen. Patience.
Understand the “laws.” In America we have laws and for the most part they are clear and you have a good idea how they may affect you. Not in Russia. Their laws, if there are some pertinent to your purpose, may be there to benefit certain parties, maybe your competitor.
Be ready for a commitment. So many have failed in Russia because they thought they could fly in, hire a representative, and fly out again and carry on from outside—as they could, say, in Cincinnati. You have to be there, in person, most of the time. After a few years and you have a dependable team in Russia, sure, you can leave more in their control. But, always be ready to make your presence.
Keep it quiet. PR releases are common in America, announcing in advance you great plans. In Russia, I learned that PR releases inform your competitor what you are doing which may well cause problems. In Russia I found that it’s best not to announce you plans, but to work it quietly as possible and enjoy the success. Stories abound of well announced new projects being blocked by some unexpected action. Keep it quiet.

Experienced vets of Russian business may well have other rules they have learned and those may well be just as important. These are some of mine.

For more read “Walking on Ice, An American Businessman in Russia”