Engineering an export success

Posted on 5 Feb 2015 by Jonny Williamson

Diamond Engineering’s Richmond Hess offers a first-hand account of how overcoming language barriers can open the door to significant overseas opportunities.

A supplier of precision engineered products and components, Diamond Engineering produces complete mechanical systems which benefit the life sciences and medical device sectors.

Diamond Engineering's automatic subcutaneous and intramuscular vaccinator.
Diamond Engineering’s automatic subcutaneous and intramuscular chick vaccinator.

The firm also produces automatic vaccination devices for one to 11-day-old chicks which it supplies to multinational vaccine manufacturers the likes of MSD, Pfizer, Merial and Ceva, who in turn supply poultry producers and hatcheries.

With almost half of Diamond’s business coming from exports, the opportunity to tap into its largest potential market, China, proved a tantalising prospect.

The country’s chicken population is nearly twice that of the world’s second largest poultry producer (the US); however multinational vaccine companies capture only around 10% of the Chinese market, the vast majority being shared among domestic vaccine manufacturers.

Despite intermittent success, the complexities of the Chinese market left those at company feeling lost in translation. The linguistic, cultural, political, and logistical barriers meant that despite significant effort, the firm’s knowledge remained limited and a crucially important market was left, for the most part, untapped.

Diamond Engineering begun penetrating the Chinese market in September 2012 by joining one of its industry’s foremost exhibitions, the VIV China exhibition in Beijing. A move that proved initially successful, with 150 companies expressing serious interest in its products and several companies enquiring about sole distributorship in China.

Following the exhibition’s success, capitalising on those who had expressed an interest proved challenging seeing as none of the exhibition delegates spoke English, Diamond didn’t have a Chinese-speaking employee on staff and using various translation services proved frustrating.

Chinese Flag
China’s chicken population is nearly twice that of the world’s second largest poultry producer (the US).

After assessing its options and with clear market validation, the firm worked with UKTI and the China-British Business Council, engaged in market research, and further approached poultry companies in China to gauge their interest in distributing its products.

Fast forward to July 2014 and I traveled to China for initial meetings with several of the interested parties, resulting in 11 meetings in 10 days. The majority of companies were PLCs listed on the Shenzhen Stock Exchange, and following every meeting came a business lunch or dinner.

At one business lunch, I was asked what I would like to drink, to which I replied “Wǒ xiǎng kuàngquán shuǐ” (“I’d like mineral water”). Though everyone erupted into laughter, I realised that if Diamond was to succeed in doing business in China, social and cultural barriers would have to be lowered. Something which I could help achieve by learning Mandarin.

Upon returning to the UK, I found three native teachers that could teach me online. One hour of tutoring and one hour of independent study a day commenced.

Four months later, I travelled to Guangzhou for a second meeting with management from DHN – the sister company of Wens Food Group, the largest poultry producer in China, an ideal regional partner to distribute Diamond’s products.

Using my newly-learnt conversational Chinese, a deal with DHN was negotiated to serve as Diamond’s sole distributor in China, and now we have offices in Guangzhou, Chongqing and Xuzhou to facilitate our post sales service.

Diamond Engineering's Richmond Hess (3rd from L).
Diamond Engineering’s Richmond Hess (3rd from L).

The 10-year contract is estimated to be worth USD$1.1m in the first year.

All related business meetings are now conducted in Mandarin, while daily communication utilises both English and Mandarin, and even some Cantonese (Guangdong’s local dialect).

Moving forward, the ease of co-operation between the two companies has not only allowed both parties to better embrace each other’s cultures, but the more open relationship has led to Diamond’s products being improved and enhanced thanks to feedback from the Chinese hatcheries that utilise them.

Devoting a significant amount of time and energy to learning a new language isn’t for everyone. However, if the market is important enough and a significant cultural and social barrier may be hindering business, I’m convinced there is no better way to increase your chances of success.

If the situation isn’t sufficient to warrant devoting yourself or one of your staff to a language completely, consider taking just three or four lessons. It could be enough to engage in simple conversation, kick-starting negotiations and opening the door to your next business opportunity.