Starting an Australian branch of an existing SA business

[sianvz]

I wonder if anyone can shed some light or advice please.

I work in the advertising industry as a client services manager/account executive for a full-service branding agency.

I studied a Bcomm in business management and majored in marketing and entrepreneurship with a post-grad in advertising communications, so that's pretty much my field and I have always had the long-term goal of having my own small agency when I have some more experience.

Today my boss was asking how our process is going and if there's a time frame yet for when we should get our visa and when we'll leave. He asked about how easy it is to find work there and what my career plans are and I got chatting to him about my plans to have my own business, specifically exactly the same type of business which he has here in South Africa. I was asking him about how they started out and whether they knew much or if they figured it out as they went along etc because I wanted to try figure out if I should rather first get more experience or if I would be ready to go for it and take on experienced people to work with me. He pretty much explained that this industry is a great one to start up in because the startup costs are minimal and it's mainly your time that people are paying for so there are not many ongoing overheads, besides employee salaries and basic office expenses.

He then made an interesting proposal. He wants me to look into the options for starting a branch of his business in Australia and me being a 50% managing partner. He wants to know the advantages and disadvantage and a bit more info on the legal side of things. His idea is that they could own 50% of the company and I could own 50% and then they put up 50% of the expenses and get 50% of the profits and can also give expertise and knowledge that I don't have yet.

I always sort of liked the idea of establishing my own business, with my own brand. But could this be a good opportunity? What are the benefits of an already existing business in South Africa opening a branch in Australia, if any? What is the red tape like? How does one go about getting more information about this?

What are the advantages for me? Would I be better off starting my own business and owning 100%?

Any input or advice is appreciated!

[DanieR]

Hi Seanvz

I have worked in Australia as a business broker and had the opportunity to see many success as well as failure businesses. Not knowing enough to comment on the business you are in I can only share my gut-feel for what it is worth.

Every country has its own ways of doing business. Appart from rules and regulations, the more complex part is to understand new customer behaviour. There are certainly some things that are different to the South African ways.

Personally I will initially work for someone else in a similar business/industry and get paid while you learn! You can keep your ideas for yourself and start when you feel comfortable to operate in a new environment, minimising the risks associated with starting something new in a new place. At such time you will also be in a better position to decide if you want to go 50/50 or solo.

Good luck !!

[Jordy]

Not knowing exactly what your company does in advertising, it is hard to comment, except to say that advertising I see on TV is completely different to South Africa. For example there is nothing like the humour found in Nandos advertising. Nothing at all. You will be surprised how unique the african humour and culture is in South African advertising. To be honest the adverts here really look low budget and amateurish.

One of the reasons is that the major TV stations all have regional versions. So there is a national version for cities and a regional version of the same TV station. So you will get Channel 7 in Perth but WIN (the regional version) in country WA. Often regional areas cannot get the signal from the city version. What this means is that advertising on regional TV is by small local businesses with small budgets - like as in a farming business advertising cropping machinery. They are amateurish because of the budget.

I think the biggest challenge you will face is not using your South African culture in your Australian advertising, and as that is all you know, I think you will struggle. The markets and type of advertising is just so different.

I so long for Nandos type advertising here but there is nothing that comes anywhere close to the creativity. There is not a single advert that I have ever seen that people talk about like "Have you seen the latest advert by xyz? It is amazing."

I would think you would need a period of a few years to learn the culture before trying something on your own. Perhaps the biggest mistake migrants from RSA make is that they assume the culture is the same as South Africa because on the surface it looks the same. But it isnt! And that is what trips people up in settling in.

[sianvz]

I know what you mean about regional WA's tv adverts, it's all sheep and sheds! I'm not too concerned with the cultural side of advertising as I would be focusing on branding as a whole as opposed to above-the-line advertising so your graphic design, web design, print, signage, copywriting etc. But I do agree that it's valuable to get to know your market etc first. I just worry about legal issues of working for a company then leaving to do my own business which could be their competition.

Even if I don't go solo immediately, I would be interested to explore the benefits of bringing an existing company to Australia compared to starting a brand new company. Either way I would start small with basic jobs like logos, corporate I'd etc.

[PauletJacques]

Hey Sianvz

Well if you decide to start your own agency you can use me for your graphics I've been freelance for the last 8 years and the thought of working for a boss again in Aus isn't making me feel warm and fuzzy! I worked for a company recently who was doing all of DStv and Box Office's promos and general TV adverts, I was more of a permanent contractor but it drove me a little nuts after 2.5 years.

I'm planning on still working for some of my SA clients once I arrive whilst my girlfriend secures a job, but would like to make the transition to Aus clients asap because of the exchange rate!

I'd be interested to see how the Australian TV/advertising culture really is in comparison to SA!

Jacques

[mittwelt]

Hi! I have a friend who lived in Aus for over 10 years and started a Marketing/Branding company. She seemed to do very well and secured work from all over (even New Zealand). She is now back in SA and still working in the same field in her own company! They plan to move back to Aus within a year or so...it would be wonderful to hook you up with her for a chat! let me know and I may be able to arrange something (at our Cape Town get together maybe?)