The latest hot export to China? Safety standards17th Jun '16
In the latest in our Routes to Growth series, Tracey Boles meets the inventor whose self-warming baby bottle is proving popular in China and Korea
Company: Yoomi Trading in: China, Korea, India Sector: Baby products
Consumers in China and Korea love top quality global brands. They also demand products that meet the toughest international safety standards, according to Dr Jim Shaikh.
His company, Yoomi, manufactures and distributes a rechargeable self-warming baby bottle that is proving a hit in both countries. The Yoomi range has recently been extended to include a breast pump and electric steriliser to provide a complete feeding system for parents.
China is particularly concerned about the baby sector after the contaminated milk powder scandal of 2008.
“Korea has a similar mindset,” Shaikh says. “Both markets cherry-pick the highest standards from around the world, meaning test after test.” For example, they may combine the toughest material standards from Japan with functional standards from the European Union.
“How a product smells can be very important to Chinese customers and some may even taste new products”
Yoomi uses an expert in materials safety and regulation to help identify the standards required in each territory and ensure correct certification.
“China is a difficult market as the standards are not always clear and easy to find. Also the rules change frequently,” Shaikh says. “So this does take some work from our side.”
The Yoomi bottle is British-made, in Dartford, Kent, making it attractive for both countries. At the press of a button, it warms milk from fridge temperature to breast-milk temperature in 60 seconds, so a crying baby can be fed fast – a huge advantage for tired new parents. Shaikh, an engineer, developed the patent after becoming a father.
China and Korea account for 60 per cent of Yoomi’s turnover, which stood at £720,000 last year and is expected to reach £850,000 this year. A planned expansion into India could see those revenue figures double. “India will be about the same size as China, for us,” he says.
Shaikh came across his Asian customers when he was exploring expansion at trade shows in Europe and found a lot of interest from the region. Yoomi went to Korea in 2013 and China a year later.
He has learnt a lot about Korean expectations. “After quality assurance, we had to think about the language and instructions on the packs. What level of detail should we go into?”
Korean customers expect a level of service way above that demanded in the UK. “It is common to expect free service; by which they mean ‘stuff’. We had to price in spares.”
Dr Shaikh also had to get used to haggling. “We spent three months negotiating the price. I finally learnt not to be upset by that.”
All this prepared him for the Chinese market, where Yoomi has experimented with a number of business models. Dr Shaikh started with a regional approach using four distributors.
“But we were unable to keep control of the pricing or the sales chain,” he says. The next phase saw Yoomi distribute directly from the UK via three specific channels on a national basis: online, baby stores and supermarkets. That lasted a year and now the firm has reverted to a distributor model, but using one for the whole of China. “We have worked with this distributor for 18 months and we know and trust them. That’s important.”
This year, Yoomi plans to open an office in China where its staff can work more closely with the sole distributor. It is that model that Yoomi will use for the move into India.
“There is no one way to do anything in China,” he says. “There are many different markets within the country and it’s the same in India. You have to be flexible and prepared to trial and change.”
Dr Shaikh also advises being prepared for cultural differences. “How a product smells can be very important to Chinese customers and some may even taste new products. We now ensure that our products undergo a double clean and hand-finishing process to ensure that everything is as it should be ‘out of the box’.”