Eastern hospitality and spontaneity: how to do business in Uzbekistan

The near abroad and Central Asia are becoming more and more interesting for Russian companies due to new markets. However, it is not enough to simply recalculate budgets taking into account other prices: a business plan can be restructured due to the peculiarities of the mentality of the population.

Alexander Radionov, founder of the Broniboy service launched in 2017, talks about how to successfully conduct business in Uzbekistan and what difficulties may arise.

As of May last year, the company is valued at 3 billion rubles, has more than 1.5 thousand restaurant partners and processes about 30 thousand orders every month.

Patriarchy of culture and its consequences

All Central Asia — it is a deeply traditional society that is just beginning to change. And therefore, a woman in business will be taken less seriously than a man, even if she is not a direct boss, but, for example, is in top management.

According to local women entrepreneurs, in negotiations and when concluding deals, a conventional male investor will have more confidence in the same male businessman.

This does not mean that women in the management of the company in Central Asia have nothing to do. There are more and more examples when gender ceases to matter in achieving success. Especially in the field of catering — restaurants and cafes today are more often opened by women. A similar situation with stores.

However, it is worth preparing for the fact that a woman will have to prove her abilities and work more than a man, and also more actively defend her position.

And if a leadership team with a mixed composition — suppose the CEO is a man, and the top management is a woman, everything will be easier if the main issues are decided by men.

Spontaneity — the second name of the Eastern mentality

If Western business is often conducted according to strict plans built in advance, and everyone knows what will happen tomorrow and what will happen in a month, then this approach does not work in Central Asia.

When entering this market, you should be ready to constantly change something and adapt to new conditions. External factors, decisions of partners, colleagues, suppliers, investors can destroy planned tasks and break deadlines at any time.

Therefore, business in Uzbekistan requires flexibility and a constant state of "alertness". In addition, you should always have a back-up plan: for example, if something happens and suppliers cannot ship the goods in a week, you must decide in advance how to get out of this situation.

At the same time, the business itself, which enters Uzbekistan, also needs to be swift, changing and quick in resolving issues. This helps to build relationships with local partners and investors, and also inspires confidence in the company.

The longer the leadership thinks and weighs, the more doubts the Uzbeks will have. This means that there is a higher risk that it will be more difficult to build long-term relationships.

Long lengthy conversations and respect are a must

Don Corleone's phrase can be safely applied to communication with the peoples of Central Asia — in business as well.

To build long-term relationships and generally get agreement on something, you need not so much an ideal business plan and a tempting offer to partners as proper communication. And first of all, it is important to show respect for the interlocutor.

The second moment — do not try to resolve the issue in three minutes, sign and leave for the next negotiations. Even if you meet to sign a contract with an Uzbek, the terms of which have been discussed for a long time, do not be in a hurry. We will first have to talk about personal, abstract topics, and from this we will smoothly move on to the pressing issue.

There is nowhere without good communication in Uzbekistan, because word of mouth plays a significant role here. It is worth doing something wrong or ruining a relationship with someone, how very quickly all friends, acquaintances and relatives of this person will know about it.

Therefore, building relationships with one conditional investor in Uzbekistan, you immediately build with ten more of his colleagues.

Required — not strong quality

Uzbeks, like many other residents of Central Asia, are guaranteed to fulfill only what they promised "their": relatives, close friends.

If you are not yet in this circle, then divide all promises by ten and do not expect that, for example, partners will fulfill the agreement reached the first time on deliveries in a week.

It is quite possible that they will have more important tasks created just by relatives. Or they'll just decide they need to renegotiate the terms.

Therefore, it is very important for foreign businesses entering Uzbekistan to choose the right style of communication with local investors, partners, colleagues and even employees. It is necessary to strictly control the implementation of all agreements.

But at the same time, traditional Russian management will only make things worse. Strict requirements, global tasks and strict deadlines do not work in Uzbekistan.

It is necessary to find the line between clear control at all stages of the fulfillment of the promise and, at the same time, friendly communication without a hint of aggression and pressure.

All issues are resolved only at a personal meeting

Another feature of communication in the countries of Central Asia — the most direct contact. All issues around the business, if possible, should be resolved live. Uzbeks love personal meetings and face-to-face communication.

There are more chances to reach a compromise or get good terms in a deal in this format than when discussing through a conditional Telegram. So, thanks to personal meetings, we managed to reduce the cost of food shooting for an advertising campaign by three times.

But at the same time, all issues with government agencies in Uzbekistan are easier to resolve remotely. Even a company can be easily and quickly opened online.

However, the request for investments, discussion of deals with partners and much more will still have to be discussed in a coffee shop over a cup of tea, coffee or in a coworking space: there are more and more of them in Uzbekistan.

Conservatism is still stronger than interest in the new

Foreign businesses have to carefully adapt their products and offers to the Central Asian market. Especially when it comes to b2b projects: Uzbek companies are not ready for global innovations. Someone will categorically refuse them, someone can be convinced, but not in one meeting.

Newmax Technologies, which develops Mytaxi taxi app, Workly cloud-based time tracking system and Maxtrack GPS vehicle navigation, has faced the fact that innovations in b2b projects have failed — the market did not perceive them.

While ordinary — for example, taxi customers — quickly tried the products and began to use them with pleasure.

The situation is gradually changing, IT is actively penetrating the market, but businesses entering Uzbekistan still need to be prepared for the fact that too innovative b2b products will not receive much attention. Potential customers will have to explain long and hard why they need it, why this is good.

Preference is given to "friends"

Uzbeks are friendly, hospitable, but, like for many eastern peoples, the concepts of clan and community are very important for them. Therefore, the country has long established the practice of promoting "their" and preferences to them in any controversial issues.

For foreign entrepreneurs, this becomes a problem in many aspects. Suppose that if a Russian businessman competes for a contract with a fellow Uzbek businessman, he will most likely lose to a local businessman. Because that — countryman. This is not an axiom, but there is a risk.

Another problem — difficulties in raising funds. A foreign startup, especially an unknown one, can join the Technopark, take part in the accelerator in Tashkent.

But it will be very difficult for him to attract investment from local funds and individual investors until he is in any community. Or until you partner with a local company. For example, the Russian telecom operator MegaFon went to Uzbekistan with the local leader Ucell.

Summarizing

In matters of mentality, Central Asia, in particular Uzbekistan, is very different from Russia — this is reflected both in building relationships with consumers and in the mechanisms of doing business. But there are no unsolvable issues: you just need to prepare more carefully for entering a new market.

When opening a business in Central Asia, an entrepreneur must take into account the characteristic features of the Eastern mentality in order to build a successful project that will be appreciated by both clients and investors.

Even the most promising business model can break on the rocks due to the fact that the company has poorly analyzed the market or neglected the specifics of the country where it is going to work.

If you forget about the patriarchal culture that is often found in the countries of Central Asia, the spontaneity and optionality of local residents, which is part of their mentality, then you will surely lose money and leave a negative impression about yourself. In such a situation, it will be difficult to return to the market and establish a dialogue with partners.

Remember that long, lengthy conversations and respect, including in solving important issues in person, will help you establish business contacts and build the right relationship.

And despite the fact that in many countries of Central Asia, conservatism is still stronger than interest in the new, and preference is given to "ours", you have every chance to occupy a certain niche and develop a profitable business.