GIA Adds Central & Eastern Europe and Japan to Network. GIA Asia Pacific Celebrates Full Integration

Based in the Czech Republic, EasyLink provides professional market research and market entry services to companies seeking sales, investment or sourcing opportunities, commercial intelligence and/or business partners/customers in Central & Eastern European region.

With offices in Tokyo and Osaka, McRBC is a specialist marketing research company and the successor to the research division of RBC, Inc., a marketing consulting company established in 1961 to deliver management solutions to domestic and overseas clients in the fields of industrial and consumer goods.

GIA interviewed Filip Kořínek, Managing Director of EasyLink and Takao Fujishiro of McRBC.

EASYLINK INTERVIEW

Welcome to the GIA Network! Filip, would you say that this is a good time for companies to invest in Eastern Europe in general?
 
“Central & Eastern Europe (CEE), by which I mean the countries to the east of Germany and Austria - namely the Czech Republic, Poland, Slovakia, Hungary, and further South and East - have been an attractive location for foreign businesses for 20 years now. Especially in the past 10 years, the region has experienced record-high GDP growth, roughly triple that of ‘old Europe’. The market structure and business climate have become largely similar here to what they are in Western Europe. The countries still retain significantly lower labor costs. This, combined with their strategic central location at the geographical heart of Europe and near the largest West European markets, makes them prime candidates for investors.
 
Also for foreign product/service suppliers and exporters, CEE has been in the limelight. With a combined population of around 300 million with growing purchasing power, an increasing share of modern retail formats and the region's strong production base partly relying on component and raw material imports, the volumes of import have been significant. Due to its strong focus on foreign trade, the region has suffered secondary affects of the current global slowdown.

Despite their fundamentally strong and stable economies, CEE economies have been influenced by reduced demand for their exports. Experts see this as a short temporary stop on forecasted long-term growth that will soon restart. It is good time now to look at opportunities here and then enjoy even stronger benefits of restored growth. Central & Eastern Europe is still the place to be in Europe!”
 
What are the major problems regarding finding accurate information about Eastern European markets from the perspective of a company that are interested in investing there?

“There is little interconnection between markets in the region in terms of information, and it is largely in local languages. Each country has its own national information resources - whether business directories, sector-specific publications, industry associations, government programs. Distribution networks are also still country-based - very few distributors can cover more than just their home country. Investment incentive programs vary by country.

Most of all, this information is in the different local languages, and may not be easy to find. Knowledge of local sources, market intelligence, contacts with local experts and good understanding of the business culture and environment are crucial in order to get accurate information within reasonable time and cost.”
 
How does EasyLink help companies with this?
 
“EasyLink Business Services has unique experience in helping foreign companies to tap into opportunities in CEE and its economic success.

Our focus has been on providing market information and competitive analysis, as well as specific business opportunities and recommendation, including identification and screening of prospective partners.

Our key strength is that we provide regional coverage with a local focus. With a network of around 20 in-market consultants in the top 12 markets in the region, we provide local market knowledge and contacts, local presence and reputation, and language skills.

At the same time, all our projects follow our corporate regional quality standards and are based on consistent methodology, reporting templates and quality assurance procedures.”
 
How long have you been doing this for and which markets do you cover?

“EasyLink has been in business for over 12 years, and many of the team members have even significantly longer professional experience. All team members speak fluently English, have the respective local language as their mother tongue, and most speak at least one other foreign language.

The EasyLink main office is in Prague, Czech Republic, where we coordinate all projects across the region. Our in-market consultants do actual project execution such as research and analysis, in the Czech Republic, Slovakia, Poland, Hungary, Romania, Bulgaria, Slovenia, Ukraine, and Russia.

For the three small Baltic economies (Estonia, Latvia, Lithuania), we work with another GIA member as an associate partner.”

MCRBC INTERVIEW

Welcome to the GIA Network! Takao, would you say that this is a good time for companies to invest in Japan in general?

“According to Bank of Japan data on inbound investment, the amount invested by foreign companies in Japan in fiscal 2008 totaled 8,257 billion yen, equivalent to roughly 22% of GDP. The contribution to GDP from investment by foreign companies is increasing annually, albeit at a marginal pace.

The United States was the top investor, accounting for 36% of total direct investment in Japan, followed by the Netherlands with 18% and France with 9%. These were followed by Cayman Islands, Singapore, Switzerland, UK, Germany, Luxembourg and Hong Kong.
The breakdown of direct foreign investment by sector was finance/insurance 45%, electrical machinery and appliances 14%, and chemicals/pharmaceuticals 9%. These were followed by transportation equipment, wholesaling/retailing, telecommunications, real estate, services, petroleum and food.

According to JETRO (Japan Export Trade Organization), approximately 130 foreign companies established business offices in Japan in 2008. Some 44 of these companies were from Europe, 41 from Asia and 31 from the United States, with the remaining ten from other regions. Japan is regarded as an investment opportunity and the underlying trend of investing in Japan is expected to remain strong, although the pace of overseas companies moving into the Japanese market has slackened to a certain degree since the Lehmann shock.

Keys to success in investing in Japan are as follows.

1. When a foreign company invests in Japan relying solely on its own resources, the upfront investment (in setting up an office, securing personnel, establishing a distribution network) until the company becomes fully familiar with Japanese business practices can be quite considerable in terms of both time and money. Thus, it involves a certain amount of risk.

2. The product-development capabilities and manufacturing technology of Japanese companies are often among the best in the world. Japanese customers are also demanding, necessitating sophisticated technology and servicing capability in order to meet their demands.

3. When contemplating entry into the Japanese market, a capital or business tie-up with a domestic company can be an effective way to exploit business opportunities rapidly.

4. Foreign companies that merely seek to improve their product export margins are unlikely to have much success in the Japanese market. The key to success is to play an active role in developing the market.”

What are the major problems regarding finding accurate information about Japanese markets from the perspective of a company interested in investing there?

“McRBC is the successor to the marketing research and consulting division of RBC, Inc., a firm with a history of nearly half a century assisting foreign companies to address challenges, formulate market-entry strategies and provide marketing and consulting services related to screening and selection of business partners.

Examples of the kinds of challenges confronting foreign companies seeking to enter the Japanese market are as follows.

• Foreign companies often lack adequate information about competitors and their products or about how to adapt their own products to the requirements of Japanese customers.
• Problems can arise because of insufficient knowledge of differences in product specs and selling approaches between the company’s home market or other overseas markets and the Japanese market as well as factors influencing the purchase decision and attitudes towards added value in the supply chain in Japan.
• Some foreign companies end up withdrawing from the Japanese market without ever acquiring sufficient knowledge about the market or considering ways to make their products more acceptable when sales fail to meet targets after tying up with a trading company or distributor.
  

While a variety of problems can contribute to the above situations, in many cases, the challenges can be addressed through in-depth competitive intelligence relevant to the targeted market segment and perception research aimed at elucidating the factors that influence customer purchase decisions.”

How can McRBC help companies with this?

“McRBC, in its capacity as the research division of RBC, Inc., has acquired a strong reputation among foreign-affiliated firms as a specialist provider of research related to market entry. In the past ten years, the firm has expanded its scope of operations to Japanese companies, but has nearly 50 years’ experience servicing the marketing research and consulting needs of foreign companies.

Market-entry studies are one of McRBC’s specialties and we believe the company can fully meet the needs of clients in this area.”

For how long have you been doing this and which markets/industries do you cover?

“McRBC in its capacity as the research division of RBC, Inc. dates back to 1961. As of 2009, it has a 48-year history.

Over this time, more than 3,000 projects have been completed covering a broad range of industrial and consumer goods. The main industries and product categories are as follows.
　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　
Our industries and product categories include:

• Industrial goods (industrial machinery/ equipment/ materials, electrical and electronic components, high tech)
• Consumer goods
• Healthcare
• Food and beverages
• Agricultural, forestry, marine produce and related products
• Apparel
• Construction and household equipment
• Chemical materials and products
• Energy
• Transportation equipment and related products
• Financial services
• IT, telecommunications, Internet
• Other manufacturing/ logistics/ services”

GIA Asia Pacific Celebrates Full Integration

GIA Asia Pacific recently celebrated its full integration into Global Intelligence Alliance. Pete Read will take on the role of Senior Vice President, Asia Pacific while Marine Mallinson will be in charge of Greater China as Managing Director with Nicolas Pechet as Vice President of China.

“Our integration with GIA is very timely, coming at a point when global economic conditions are showing regular improvement, companies in Europe and North America are looking to Asia for business growth, and Chinese as well as other Asian companies are increasingly exploring worldwide opportunities. GIA is now ideally placed as a strategic market intelligence and advisory partner for all these companies,” said Pete Read.

Please click for more on GIA Asia Pacific and Greater China.

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