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Asia tempts small companies too

A new company, Tozai, is seeking to open up the route to Asia for SMEs

It is now high time for Swiss small and medium-sized enterprises (SMEs) to move into the Asian market. This is the opinion of the new company Tozai, which helps SMEs to make the move to the Far East. Japan is the gateway to the booming Asian growth markets, and it is here that Tozai has established its first bridgehead – with others planned for Korea, Singapore and China.

The Asian market has priority amongst large multinational companies. It is therefore no wonder that the markets in China, Korea, Singapore, Taiwan and Japan have a tremendous growth potential. The Swiss Chamber of Commerce maintains that "The route to success in the Asian markets is via Japan". Indeed, for decades Japan remained a closed market in which it was virtually impossible for foreign firms to get a foothold with their products.

However, these times are now past and in Japan there is a demand for western products such as never before. The younger generation in particular is buying up consumer goods from the West: toys from Toys’R’Us are greatly sought after, for instance. Young Japanese consumers buy their CDs and records at Tower Records, and Nivea is one of the most popular skin creams in Japan. McDonald’s is even on its way to becoming the largest and most successful restaurant chain in the land of the rising sun.

Small and medium-sized companies also have good chances of success with their niche products. Heinz Zürcher, co-owner of Tozai - which has representative offices in London, Tokyo and Zug - believes that "Japan offers new opportunities for Swiss SMEs". During trips to Asia he noted that "Swiss-made products are highly sought after".

Despite this, the setting up of an export channel to the Far East is far from easy. The different mentality, different approach to business, different regulations and the foreign language are all major obstacles for small companies. As a result, many SMEs give up trying to export to Asia. Heinz Zürcher is now seeking to change all that. Several years ago, the 27-year old studied at the School for Young Entrepreneurs at the School of Economics and Management (HWV) in Olten, Switzerland, and was co-founder of AZ-Datentechnik, a company specializing in computer-networks. His work took him to Asia on a number of occasions and he discovered the booming growth market there. " As an entrepreneur, I saw my future in global transfer business" says Zürcher, who then immediately sold his share in the flourishing Datentechnik company.

With this clear objective in mind, Zürcher then proceeded to prepare himself for his future venture. Together with Englishman Andy Mankiewicz, he devised a strategy to facilitate the entry of SMEs into the Asian markets. The team was aware that some organizations and consultancy firms were already involved in export promotion. "But even the best export strategies are fruitless unless implemented efficiently and rapidly", Zürcher says.

It is precisely the issue of implementation which sets the Tozai strategy apart from the rest. The SME should receive not only advice but also active sales support. The English partner had precisely the right expertise to achieve this: the 26-year old manager had lived and worked in Tokyo for three years. He therefore knew the country, had contacts there and could even speak Japanese.

In order to turn the idea into a reality, the company Tozai Consulting set up by Mankiewicz in London two years previously was reorganized to form Tozai Group Ltd. The Tokyo office is managed by Mankiewicz himself. Tozai Group AG, which was founded in August 1996 and is domiciled in Zug, is managed by Zürcher together with 33-year old engineer Daniel Isler.

Although the group has been in operation for just over three months, it has already succeeded in convincing several clients of the benefits of the new service. The flexibility and dynamism of the young heads of the company is in itself convincing. "What we want" explained Zürcher "is to bring our clients’ products to the end-user market as rapidly as possible". The Tozai branch in Tokyo is responsible for active on-site representation and the promotion of sales, which are conducted largely on a commission basis. The newly established company thus assumes some of the risks which are always involved when moving into a new market

Claus Niedermann