Don't rely on single product for Asia sales

TAMLYN STEWART
Last updated 05:00 10/10/2012

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Entering Asian markets with one product would not work, former head of Asia-Pacific for health and hygiene product company Kimberly Clark, Mark Wynne said yesterday.

Wynne was speaking to members of the Kiwi Innovation Network at a commercialisation forum in Christchurch.

To succeed in an Asian market a company needed a clear vision, "and it's got to be bigger than the widget sitting in your pocket".

"You will be copied, replicated and outrun in very short order. If you are a one-product wonder you won't last long in Asia.

"This is where most New Zealand companies will fall down, in market execution."

New Zealand companies could enter a market overseas through an agent, a subsidiary, a distributor or a joint venture. Each had varying degrees of risk and return.

Wynne advised companies to enlist a medium-sized distributor as those were usually the "hungriest", while a Kiwi company would be too small when dealing with a big distributor.

"Find a son who has taken over from his father and is keen to prove themselves. Those have always been our best distributors. If you want a clue, that is where I would start."

Negotiating tactics used overseas could include deception, playing competitors off against each other, controlling the agenda, mastering the art of delay, taking advantage of an opponent's trouble and allowing the opponent to speak first.

An important concept was the Chinese principle of guanxi - which meant "connections with mutual goodwill".

It was about trust, which took time to build.

Kiwi Innovation Network chairwoman Ruth Richardson said New Zealand needed to lift its ability to commercialise its scientific research.

The network's purpose was to "flush out the ideas across the spectrum of publicly-funded research organisations and help drive them into the market".

Richardson praised Tait, Wynyard, Endace and Gallagher, who have formed an alliance to grow a new market category in the security sector.

KiwiNet is a group of New Zealand universities and Crown Research Institutes collaborating on research commercialisation.

Dirk Pons, senior lecturer mechanical engineering at the University of Canterbury, said it was hard for small firms to fund research.

"The cost of manufacturing is too high in New Zealand. It is not productive enough and not lean enough to keep it here."

Pons said he could go into any manufacturing firm in Christchurch and after an hour give them an insight that would be useful to them, but the issue of who would fund that remained.

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- BusinessDay.co.nz

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