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intelligence
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...Continued from page 43) everything and allows them to focus on what they are best at. It also allows them to band together products and services to create higher priced, more valuably perceived packages – which tend to be easier to sell to potential buyers. In effect, they become a one-stop shop, something that can be extremely attractive for procurers looking for suppliers to major projects.
SPORTING CHANCE
UK Trade & Investment actively encourages smaller UK companies to form or join such partnerships, particularly in challenging and highgrowth overseas markets. These include Brazil, one of the world’s most rapidly developing economies, with a GDP per capita greater than either India or China.
Chris Wall, UK Trade & Investment business specialist for Brazil, says: “For a UK company, being part of a consortium in approaching the market in Brazil can give access to better market data. It also means having shared objectives with non-competing members of the same supply chain and can lead to greater leverage in market development when approaching high-value opportunities.
“Brazilian businesses and trade associations (many of which support their members’ search for international partners) tend to look very favourably on such ‘institutional’ approaches. Other benefits include access to third-party opportunities – additional business streams in new markets which have come about as a result of relationships developed with other UK companies in the same consortium. There have been a number of examples of UK firms tackling the Brazilian market in this way, including those bidding for contracts related to the 2014 FIFA World Cup and 2016 Olympic Games, both to be hosted in Brazil.”
REDUCED RISK
South Africa is another market where the consortium approach can pay dividends for UK companies. Shakeel Mughal, UK Trade & Investment business specialist for South Africa, says: “For UK companies who have a specialist product or service to offer, have no presence in South Africa and wish to win new projects there, teaming up with or participating in locally formed consortia is a worthwhile approach to consider. It is a particularly good option in major projects where the client requires a full solution as opposed to a piecemeal approach. For the UK companies involved, it presents an opportunity to win business where their exposure to risk is defined and manageable, while complying with local requirements, such as Black Empowerment (BE) laws.
“The other scenario is a major UK company that has a presence in South Africa, and the ability to take on the role of a prime contractor, but requires additional products or services in areas that are not core to their offering in order to be compliant and competitive. In this instance, the company may choose to form a consortium with South African or international players who have the requisite expertise and experience.”
CREATING LINKS
UK Trade & Investment can help companies interested in forming or gaining access to a consortium. Its business specialists and teams based in British embassies and consulates across the globe have access to local business networks and companies who can work with UK firms to win and deliver a project. They can also carry out due diligence on local companies and potential partners. (Continued on page 45...)
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