Starting a business is never easy, but the current state of India’s economy means there are plenty of investment opportunities if you’ve got the right product or service. According to the Indian Brand Equity Foundation, India’s Gross Domestic Product (GDP) for 2022 was Rs. 232.15 trillion (US$ 3.12 trillion). This puts India’s economy among the top five largest in the world. In terms of business, India is the third-largest unicorn base in the world. For clarity, unicorns in business are privately owned companies worth over $1 billion. In 2022, India had more than 100 unicorns with a combined value of over $332 billion.
These are positive statistics for anyone in business or thinking of starting one. Of course, a strong economy and thriving business sector doesn’t mean everyone is guaranteed to succeed. However, when the conditions are right, there’s a better chance of breaking through and building a profitable company. Like all great journeys, the road to success starts with a single step. This means you need to focus on the fundamentals first.
Start Small and Get the Basics Right
Draw up a business plan, secure some capital and focus on creating a high-quality product or service. From there, you can think about marketing and finding a customer base on a local level. Even if the ultimate goal is to build an international brand, you should keep a local profile at least for a while. This gives you an opportunity to iron out any kinks in your business and perfect your craft. Indeed, by the time you expand and offer products/services on a national and international level, you shouldn’t be making needless mistakes.
You will almost certainly make mistakes, but these shouldn’t be basic errors such as stock, pricing and customer service. Once you’re proficient in the fundamentals and making a profit, expansion is the natural step. This is when you need to look outside of India and consider the economics of other countries. For example, let’s say you want to attract investors from the US or set up trades in the US. The first thing you need to know is the strength of its economy.
Understand an Economy Before You Expand
Generally, the US is an economic powerhouse, but there will be times its financial fortunes are better than others. In general, it’s better to trade with countries that are financially stable than ones that aren’t. There are exceptions to this rule, but two economically strong nations typically work well together. You can visit the Bureau of Economic Analysis website to get an overview of the US economy and metrics such as GDP, income statistics, and international trade activity.
Once you’ve got a general overview of the economy, you then need to understand a country’s currency. Specifically, what’s a currency worth in global terms? If you’re sizing up the US as a potential market for your business, the DXY chart gives you an overview of the US Dollar Index. This index tracks the US Dollar’s (USD) strength in relation to a basket of major currencies. Put simply, it tells you how strong or weak USD is compared to other currencies.
Foreign Trade Requires Foreign Currencies
The strength of currencies is important when you’re trading in foreign markets. A strong USD means it can buy more foreign currency than before. A weak USD means it can buy less foreign currency than before. In business terms, a strong USD means it’s cheaper for American companies to buy foreign products. A weak USD means it’s more expensive. So, if you’re looking for US investors, you want a strong USD. Similarly, if you’re selling products in the US, a strong USD means products can be priced competitively.
2023 can be seen as a good time to start a business based on the strength of India’s economy. As long as you start slow, there’s scope to grow over time. Indeed, by understanding basic economics locally, nationally and internationally, you give yourself the ability to expand into new markets. Nothing is guaranteed, but with the right knowledge and a solid product, anything is possible in the business world.
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