There can be few machine builders that are not working hard to establish an overseas customer base. It is a long road to travel, so Neil Mead, editor of Automation and Chris Evans of Mitsubishi Electric explore what it takes to become a successful exporter
Politicians and academics tell us that the economy is globalising; that there is more and more trade being done across international borders. As supply and communication lines become stronger, buyers are simply not willing to confine themselves to local suppliers; they want to buy good quality at reasonable prices backed by good service and support.
But what does this mean at the working face of automation? How do you start exporting, or build on the business you have?
Where once competitor companies would have been relatively local, now they are likely to come from literally anywhere in the world and start fishing in your pond. If they have made the effort to attack your markets, they will almost certainly have made sure they have products and services that will be very attractive to potential buyers.
This trend cannot be stopped and cannot be ignored. The best response is to start exporting, or to grow current exports so that you are serving a number of different regions.
The first step then is to research several overseas markets and select those to approach. Doing one at a time may seem easiest but there would be benefits of risk-reduction, cross-fertilisation and economies of scale if you were to have two or more target markets. Further research would include contacting trade councils, embassies etc and this will lead to exploratory visits.
Soon you should have some potential customers in your sights and you need to understand their issues. It is likely that your products will need adapting to local requirements. And they will also need service and support capabilities to hand.
Of course, many companies are already exporting; for them it is important that they look to open up new regions too, so that so that the waxing and waning of local markets is evened out. And it is also true that many companies are focusing on building business in China - clearly a market with decades of growth potential. It is also a good idea to remember the other BRIC (Brazil, Russia, India, China) countries too.
The first stage of research is largely desk-based. Market intelligence is probably the usual starting point - simply picking up some ideas during normal business activity. This is followed by information gathering from say trade associations and chambers of commerce. Then some expert guidance from organisations like UK Trade and Investment, a Government department that works with businesses to ensure their success in international markets, and encourage the best overseas companies to look to the UK as their global partner.
Once you get to identifying specific markets, organisations like the China-Britain Business Council can be a real help. It offers a number of practical services to help identify and win business as well as set up operations. These include strategy development, cultural training, translation and interpreting, introductions, visas, local marketing, due diligence etc. Machine builder trade associations such as the PPMA also run initiatives for their members which offer practical help to companies, in particular in China.
There are also several technical issues to consider. Machine and systems designed for the UK may not be ideal for other regions. A key issue these days is the control system. This needs to be based on hardware that is recognised and supported in the region. In Asia for instance, you are not going to go far wrong by using equipment from the leading Japanese automation manufacturer whose equipment is of course fully globalised, so acceptable in say North America and Eastern Europe too.
Still with the control systems, today’s PLCs, drives, servos and HMIs have a trait that is also common to consumer electronics - lots of on-board optional features. Often these go unused but in an export environment they can provide a sales edge, and/or much higher functionality, so that servicing in the field becomes easier. For instance, as part of the total solution, the Mitsubishi L-Series PLC includes in built data logging, which can be interrogated from the UK no matter where in the world it is deployed. It also has comprehensive options for connecting to higher level control and management systems - a feature that is imperative in the sort of ultra-highly automated plants being built in Asia.
Outside the control system, the general electrical and mechanical equipment will need to be supported in the field, so once again it is a good idea to go with the big brands - those whose logos you see while travelling the world.
In summary then, building and sustaining export businesses is challenging to say the least but by breaking it down into small steps, putting together a sensible plan, understanding the customers and partnering with the right suppliers, it is perfectly do-able and it is likely to prove absolutely essential as the world markets recover after these years in the doldrums.
Mitsubishi Electric has held a series of conferences aimed at helping machine builders grow their export business. The first took place at the company's HQ in Hatfield, Hertfordshire at the end of October with the next on 7th November in Sheffield. Visit www.automation.mitsubishielectric.co.uk/events for more details.
Mitsubishi Electric Europe
T: 01707 2761000