We all know that trusted partnerships in Asia take a long time to develop. I have had first-hand experience of this on multiple occasions. There is one particular relationship that I am most proud of which I would like to share with you.
For just over ten years, I was the Managing Director of a plastics company operating in Melbourne, Australia. We manufactured and distributed a large range of extruded plastic meshes and underground pipe marker tapes. It was a foreign-owned business with the headquarters in the United Kingdom and large operations in Germany and the United States. My responsibility was primarily the Australian market but we also looked after the Asia Pacific region.
We needed to find a very strong partner to supply us with plastic mesh products. China was the best choice since I knew they produced the type of products we needed in the right quality for the Australian and New Zealand markets. I worked with my Chinese based colleague, Nancy, to find the right partners to supply us. Nancy developed relationships with our Chinese customers and suppliers assisting me with our business dealings and language interpretations.
We started the process of researching who would be the best partner to manufacture the plastic mesh we needed. This included talking to contacts in other western countries who were more familiar in dealing with the Chinese in these kinds of situations. After developing the short list of companies I thought could do the job because of the referrals as well as the type of production equipment and facilities they had. We then made contact with these suppliers. They provided us with details of their company profile, product range, samples, pricing and export commercial arrangements.
We were able to whittle the list down to two companies that we thought would make good supply partners. Yes, technically they were suppliers, but I call them a partner because they are a very important part of my business. I then flew to China so Nancy could meet with both suppliers. One of those suppliers was a company based just outside Shanghai. The company was owned by a gentlemen called Mr. Teng.
How did we end up choosing Mr. Teng and his company to be our partner? First impressions were very important. Mr. Teng encouraged me to visit his business and see his operations for four days. I went out socially with him and his people. We saw every part of the factory and were shown exactly what his equipment could do. This generated many questions in my mind that Mr. Teng openly answered without hesitation.
One of the most important factors was that Mr. Teng was formally the production manager before he purchased the company. He was very knowledgeable about the capability of his equipment and was very skilled at designing products. I saw evidence of that first hand during my visits. He would have samples made that were to our specification and if they needed any tweaking, he could disappear to the factory floor and within an hour, he came back with new samples for me to inspect and approve. Nancy and I were very impressed.
We also found out what his relationships were with supplying other companies around the world. Mr. Teng had dealt with another company in Australia and was upfront with me discussing the details of this relationship. I appreciated his honesty and ultimately we worked out a way he could adjust this relationship so it had no impact on our business in Australia.
Mr. Teng then agreed to provide us with exclusivity in Australia for the products that we needed him to supply us. A win: win situation for both of us and it proved to be an important stepping stone for the strengthening of our relationship.
It also struck me that Mr. Teng had such an attention to detail and knew what western quality is. The equipment he used to manufacture the product was not Chinese equipment; it was the same brand and type of equipment that our UK division used. Mr. Teng had bought the rights to the European-brand equipment because he knew he needed the quality to supply export markets.
So I am going down that list in my head, ticking off the boxes as I went along. I personally liked Mr. Teng and began to trust him. He was very open to commercial relationships and was flexible around our needs. During Nancy and my third visit to see Mr. Teng we invited him to become our plastic mesh supplier and begin business. He was very happy to accept and so begun a relationship that became very important to both our companies.
We had a business relationship that lasted for 10 years while I was in charge of the business in Australia. I am proud to say that following my introduction that our UK parent company also formed a partnership with Mr. Teng that continues to this day. Despite not working with the business now I still have a relationship with Mr. Teng 15 years later. Last year he came to Australia and we enjoyed each other companies for a few days. We have become firm friends.
The main take outs from this case study in selecting an Asian partner are –
- My Chinese colleague Nancy played a key role in the process.
- We did not rush in selecting a partner.
- We did our due diligence.
- We spent time nurturing the relationship before committing fully.
- It was a step by step process.
But most importantly we were able to develop a fruitful relationship which was a win: win for both Mr. Teng and I.
As an added bonus we also became good friends which is the ultimate outcome of a trusted partnership in Asia.