Mr Asia

by Matthew Rock - Monday, 10th September 2007

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Having retired last week from his quoted consumer electronics group, let’s look at Harris’s secrets of winning in Asia.

These are extracts from a talk he gave at an event we organised with HSBC in 2005.

In China, relationships are everything: “Many of the people I worked with in the 1960s are still suppliers today.”

An increasingly sophisticated business community: “In negotiations today, the person on the other side of the negotiating table is quite possibly a graduate of Harvard Business School. He will know everything he needs to know; he will know your market; he will probably know as much about your company as you."

Industrialisation is migrating: “There are now television factories in remote areas of western China. If you are operating there, do look at the infrastructure – not only utilities but also the roads.

"If your goods are not packed coming from the factories, you may find that they are not what you would hope for when they finally arrive in the UK.”

Always stay on top of quality: “Have your own people based in the factories and production lines to watch the components that are used.”

Selling into China: “The first essential in selling into China is to have a global brand; with Grundig, we do.

"There are some 200 million people in China with quite a substantial disposable income. If you have the right brand and you produce a prestige product, you can sell in China.

"Note also that some familiar retailers (Tesco, B&Q) are opening up in China. That will help, as you are working with retailers you know.”

Protecting your intellectual property rights: “I believe it is the policy of the Chinese government to stamp out infringement of all types of copyright and patents. However, it is down to particular regions to monitor the problem, and not all them are as good as others...

“We make all our purchasing by irrevocable letter of credit. One condition we make on every letter of credit is that all suppliers obtain a certificate from our own offices that they have paid all payable licence fees. If they don't have this certificate, it invalidates the letter of credit. We will not accept any discrepancy.”

Defer to age: “China defers to age more than in the UK, where we have a youth culture. In China, great respect is paid to age, so if you have any people over 60 or 70, don't dispense with them; use them!”

Tags: china, bq, harvard business school, intellectual property rights, hsbc, tesco, consumer electronics group, john harris, letter of credit, alba, grundig,