My wife says that people who are better at their job are given either the US or the EU market. The rest are sent to the Asia-Pacific division.
This company I’m dealing with is clearly a 2 policies company, even against the same company. From one side we see their EU people (some of them are really European), get the job done with them (sums that are close to 220M USD a year, and they were doing close to 0 before starting with us) and be all happy. Them, we get the Asia-Pacific side, with people telling us that their strategy cannot be the same as EU because the size of the operation is different, the markets are different and the boss doesn’t allow anything else than SOP, and SOP makes them sell 0 under their brand.
Too bad for them we are customer number 1 under their brand (and likely we absorb about 70% of their products), so any deal done with us now is done under our terms, otherwise there are plenty of other TW companies doing the same that want to get a piece of our channel. Tomorrow I’ll have lunch with another company and meeting at 4 with another, all of them will have people (if I want to) meeting us in CEBIT.
90% of my job is just to filter this BS we see from TW. In fact, my job is to learn the market strategies different brands have, check which ones are applicable to our channel and forward the information to the HQ. They don’t have time to meet 20 companies just to decide on 1 product, so basically, I have to choose at least 2 alternatives. Then it is based on who gives better conditions to work with (credit/payment/RMA/MDF/Refunds).
I like hearing what’s being said here. I wish I could attend the entrepreneurship meeting because the concept of what makes a solid “brand” here in Taiwan is going to be such an important factor in the future.
IMHO there’s no ideal formula but consistent service, quality, and style seem to be the top qualities of the brands that I recognize.
Someone mentioned that the level of talent here makes it difficult to strongly support these values. I would like the think that the younger generation IS prepared to rise to the challenge…but the new ideas and energy coming from my Taiwanese coworkers could definitely improve.
If anyone has advice for starting an international trading business please chime in.
I would think the lack of branding from Taiwan that you guys complain about is actually an opportunity.
As an example back to Mr. He’s original topic about starting a trading company. He is creating a “brand” for his customers. His customers know they can count on him to deliver quality goods in a timely manner, at a fair price.
There have been a lot of folks from Taiwan who have built family fortunes/empires without a brand.
I think the main difference between Taiwan and lets say, US or EU, in terms of branding is exposure.
In Taiwan, the big brands have exposure from a lot of places, say business news, stock market, newspapers, etc… that gives them an advantage as this all comes mostly for free. Most of their publicity work is done KTV way…
In US and EU, it is pretty different. The market is driven by the ability of a certain company to stand out. That can be done in many ways, but most of them either regard intense marketing, or getting a good channel and dropping goods (like promotions for big retailers as Walmart, Costco, Carrefour, MediaMarkt). This is a much more capital intensive operation (and let us not forget you’ll still have to do KTV style operations), and needs many human resources.
I’ve been talking with a large US company who wants to enter the EU market, and basically, they just told us that we need to get the facilities (assembly of final product, after-sales service and logistics) and to prepare a marketing plan. Then they will discuss about quantities and prices. This is exactly the other way around that TW companies do - they first give you prices and ask for quantities, then they will see how to get the facilities and, if you are lucky, to prepare marketing.
Maybe my experience is not exactly what you need (the group I work for does almost 1B € a year in turnover), but it can help you understand the mentality. US and EU people only want to do business if the conditions are set for you to do it - without them, quantities and prices loose all the meaning. As you imagine, a lot of emails arrive to me with offers for everything and their mother… but to have the conditions to do the business or not is what makes me decide between deleting or not the email.
Mr. Boogie wrote: “Maybe my experience is not exactly what you need (the group I work for does almost 1B € a year in turnover), but it can help you understand the mentality.”
Your posts about mentality and business approach have been very informative.
It sounds like you are in some sizeable deals, almost approaching b school style case studies, however you are providing straightforward practical advice that is not included in text books.
On the flip side, yes I am guilty of enjoying stories about one or two people who make their living importing/selling gloves, and or rubber dog poop.
I enjoy the entrepreneurial spirit and small business climate of Taiwan. That climate includes a lot of frustrating business practices. As you know it is the same with small business (entrepreneurs) in the States. Many of these folks are great at starting companies, but not very good once the business grows to the point of needing “professional” management etc.
So Mr. Boogie please continue your advice, insight, and details about deal structuring.
And if there is a guy out there in a dimly lit room with a desk full of coffee stains making a living trading rubber dog poop, please chime in as well.
We have been lucky enough to gather some decent information on this thread.
I’m going to be in Cebit for 2 weeks (I’ll go to Budapest before) so I won’t be able to post, but if any forumosans are going there… I’ll be in Hall 25, and my booth will probably have a lot of green (from a known TW brand)…
I am doing better and better, however it took time to get there.
Stick to your speciality, if you have developed one; that’s where the money are, however if you feel it’s not panning out, you don’t. if it pans out too slow, push it harder.
They will tell you:
You will be our agent in that market - we give you fob prices, so you take care of the logistics, warehousing, marketing and whatever. What we will try to do is to give you the best goods at the best price. More than that, it is up to you to work for the sake of my brand. Then, when my brand has recognition, I will sell it to your customers directly, after I send a team of sales there (if the market justifies it). If not, it will be you who failed miserably in understanding your own market, we will keep looking for the next looser that comes along.[/quote]
So make your end user sign contracts that ensure they deal with you and that you can’t be cut-out.
[quote=“mr_boogie”]
Just remember that Taiwanese are experts at fucking up other people’s biz, specially with their “go behind” mentality.[/quote]
And its this very mentality that makes us indispensible as middlemen between the distrustful western company and Taiwanese supplier.
I have a few friends operating in a similar environment to you and Mr He and the suppliers did contact the customer directly, only for the customer to refer them back to my friend. It would take two companies to screw you which is unlikely unless you are providing no value add other than bringing two companies together…
we provide the biggest of the services, which is the financial solution - normally our customers pay on 30-60 day basis, while we have shorter payment terms to the manufacturer.
Most big companies won’t allow you to do exclusivity contracts for a market as wide as ours - all EU, plus Russia and Turkey. Unless we talk with companies which are not yet implemented in the market, we will rarely have excellent opportunities (read profits).
The last turn of events surrounding one of our suppliers made us almost buy their brand, as they only have projection in Europe. We are still discussing, because the values in the table are very high. If we can buy it, it will be a nice turn of events, otherwise we will require them to pay us a hefty fine for creating them the market. As we said to the last TW company who fucked us, and went down to the obscurity in Europe, if you go behind us, we will sell peanuts. Nowadays, they are lobbying us again to get back to them, with extremely advantageous conditions to us. We are not convinced yet.
kfed, you can be sure I am hiding things from you - what am I, your consultant?
However, one thing I am learning is that doing your time and building the connection network is so important. Once it’s there, things tend to be so much better.
The last weeks, I have seen contacts of current customers placing a few orders, and in general being busy starting up new productions. That’s good. Very good indeed. Bloody excellent.
Apart from that one of the US importers who have spent time talking about buying for millions and millions of dollars of equipment finally came through with their first real big order for equipment. Nice start on the weekend. Again, they are quite able to locate and talk to suppliers here in Taiwan and in China, however they realize that they don’t understand the environment, and that they want someone they can trust here.
They would appear to choose me.
So again, apart from being good at what you do, staying power is important, as that will ensure that people you have pestered for years finally come through.
Including orders in production, we are so far up 138% compared to all of 2007, so no excuse not to celebrate. (And yes, it has dawned upon me that 2008 is not over yet).
The extra sales and the in come they have generated have been invested in booze, women, and expensive toys… what I mean is that we have invested them in ads, updated web site, product marketing, and if it continues a few trade shows. that should keep the momentum, I guess. I think that plowing the surplus back into the business is the way to go, our reserves are important as well, however investing and marketing is key as well.