Feature Interviews Summary – The Importance of having a Local Presence

We set out this year to interview operational and managerial staff from both the Chilean and Peruvian mining industry. The idea was to provide foreign companies with an inside view into the local mining market from the perspective of those actually working in it.  

What came from those interviews was some key insights into the type of technologies that the different operations were implementing. Even more importantly, they provided some practical tips to help foreign companies better engage with the region. The most common theme was the importance to have a local presence. 

You can find a full list of some of the interviews here – 

Do you really understand that your clients want you to have a local presence?

Conclusion

In every interview we completed, the executives spoke in some shape or form about the need for providers to have a local presence.  You can’t really know your clients’ problems or build relationships with them without having someone on the ground who can have direct contact. A local presence is needed. The same with after-sales support and customer service.

We often see companies that do not want to have a local presence. They prefer to use partners. There is nothing wrong with this. There are many products, often simpler in nature, that work through a traditional distribution network. I would still make the argument that these companies would do better with someone on the ground to support their partners, but it is not necessary.

For other solutions that are more technical in nature, having a local presence is key if they want to improve their success rate, speed up the sales process, and ensure their clients are happy. Don’t take my word for it, in every interview the executives specifically said that foreign companies would do better if they had a local presence. What companies get wrong is that they do not need to make a huge investment to have a local presence. I actually recommend a “hybrid model” for many companies.

What  is a hybrid model?

The hybrid model is simple.  Companies need a “light” local presence that supports the local partners who are spread out in the major Latin American markets. Partners open the doors and provide labour where needed. The foreign companies should have a sales or technical manager that attends meetings with them, pushes them, and supports them. As sales are made, you can send staff to manage the installations with your partners, or you can hire local employees. Once you have some clients, you can set up some type of after-sales support team either through your existing staff or hiring for these new positions.

The hybrid model works because it gives you a local presence that can grow as sales do. Companies start with a sale person and as they start to make sales than they can build out other key members of the team. We have clients that are extremely successful with very small teams that they have been built out using this hybrid model.

From a cost and time perspective – Ax Legal helps companies by taking away the complexity of having a foreign company. We set up the company so that it is operational, we help you on-board your first staff, manage payroll and accounting, and support clients with administration and banking. Clients have budget certainty because we charge a fixed monthly fee for our services while providing on-the-ground support to ensure that clients are successful at each stage of their growth. By taking away the head ache and the cost pain, companies can focus on what they do best, selling and servicing their clients. 

Ax Legal is a legal and business advisory firm that works with foreign companies in Latin America. Our team of legal and commercial advisors have a distinguished track record of helping foreign technology and services companies to grow and operate in Latin America. Over the years, we have worked with starts up, mid-size businesses, and publicly listed companies. The one common factor that connects are clients is that they are leaders in their field, providing innovative technologies and services to the industrial sectors.

To better understand how we can support you in the Region, please contact Cody Mcfarlane at cmm@ax.legal