Selling in the Far East: The challenges are worth the rewards5th Dec '17
There’s a wealth of support available to British businesses looking to forge trade links with China and other flourishing economies in Asia – here’s what we learned at the Routes to Growth conference, 2017.
Every year thousands of UK firms trade in Asia. With growth forecasts for the region at 5.6% outstripping those of the US (2.1%), Eurozone (1.9%) and UK (1.5%), others are encouraged to look East for business opportunities. Some of those successfully trading in China and the surrounding economies met in London at the 2017 Routes to Growth conference, a programme run by Cathay Pacific, to facilitate and encourage the UK’s small and medium-sized companies to open up links in Asia. These delegates – SME owners/managers and sector experts – traded tips and experiences.
Build on what’s already there
“The great thing about Britain in the Far East is that we didn’t arrive yesterday,” said Richard Graham MP, a former diplomat in the region, currently Chair of the All Party Parliamentary China Group and the Prime Minister’s Trade Envoy to the ASEAN Economic Community. “We have been doing business there for a very long time and we can build on that; the systems and structures, laws and regulations that are very familiar to us.”
There are also businesses successfully trading who can act as mentors and advisers. “In every corner of South East and North Asia there are people and organisations who have done what you, as SMEs, are trying to do. The secret is to meet the people who know what you need to know. Use their knowledge, networks and connections.”
Look beyond the obvious
There are wider opportunities than simply selling goods and products to this vast and increasingly affluent market. Looking beyond the tangible can generate some surprising results. “We sometimes miss our core strengths,” said Graham. “For example, we now sell more in education than we do in insurance. We have five British universities in Malaysia alone.”
Asian nations want to access international education through Britain and it’s not just those who travel to the UK; increasingly, universities and colleges have Far Eastern campuses, selling their world-renowned brand in-situ.
Nor is it just universities in the leading Russell Group who are moving East. Wellington College, the prestigious Berkshire school, is just one of many with operations in China. Others are offering more vocational courses alongside academic qualifications, the Routes to Growth conference was told.
Know your USP
Chinese manufacturers are not your competitors. True, these businesses make products often significantly more cheaply than we can in the UK – and to a high standard. But they should not be seen as rivals, the conference was told.
The UK has many century-old manufacturing businesses. “These make very specialist tailored products with bespoke customer service, absolute customer reliability and, above all, quality,” said Graham. “That’s what we are good at.”
And that should be the selling point for premium producers. The Far East may undercut on price, but the UK has its reputation for quality and craftsmanship.
This generates a whole new opportunity; the ability to cross-sell to one another’s clients. Two small UK businesses, local to each other, may operate in the same sector but offer different products. Work together is the advice.
As Richard Graham said: “We are creating world-beating small companies,” the kind of businesses found on the Routes to Growth website.
Culture is key
Tiny cultural or regulatory issues can derail even the most thorough preparation. “Different colours mean different things. Red and pinks are seen as very positive,” explained Emma Alesworth from WWT Consulting, the advisory arm of UK conservation charity the Wildfowl and Wetlands Trust. “When it comes to designing marketing and online materials, these are important issues.”
As are specific regulations. Edward Burt, MD of Burts Biscuits, recalled how a whole consignment had to be scrapped because it contained potassium sorbate, an ingredient used as a preservative. “The product was well received – but not so when it got to customs! It’s legal to use it in production in Japan, but it is a banned additive to import.”
As Emma Alesworth explained: “You have to immerse yourself into the culture; not treat people as business colleagues but treat them as friends. Get them to visit your home. When I first arrived in Singapore I thought it was just like the UK. Three months later I realised just how different it is.”
It can be a mix of formal and very informal: “You have to be personable,” she says. “I’ve had trips that involved sessions in a karaoke booth with people I had only just met.”