Talking International will be a series of interviews with people involved in international business. They will represent manufacturing, professional services, academia, government, nonprofits, and trade associations. The goal is to provide you the reader with a wealth of information that might be useful in your own decision-making process as it relates to all things international. […]
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Talking International will be a series of interviews with people involved in international business. They will represent manufacturing, professional services, academia, government, nonprofits, and trade associations. The goal is to provide you the reader with a wealth of information that might be useful in your own decision-making process as it relates to all things international.
Vinny Lobdell, Jr. is president of Healthway Home Products and PURE Global in Pulaski. HealthWay Home Products, which develops and manufactures air-quality products, was formed in 2003 in the top of Vinny’s father’s horse barn. It was just the two of them. Since then, they have grown the business into a global operation, exporting to more than 30 countries with over 200 employees working in five offices in three different countries.
Q: How does internationalism help small local companies?
LOBDELL: Anytime two or more countries work together in a friendly manner to open up trade or reduce barriers to trade and commerce, it has a very positive impact on companies of all sizes. Internationalism has played a key role in our business as it has increased our potential customer base 10-fold and has done so in markets where air quality is even more of a concern than here.
Q: Why and how did your company get involved in the international marketplace?
LOBDELL: We have always focused on trying to be the first to position our high-end, air-quality products in emerging markets. This can be a costly approach, but if done right can really pay off as the market becomes more educated on the need for your products, and sees you as a first-to-market educator and leader. We focused on international, because we saw that this is where the market for us was going. We spent a lot of time and money pursuing these markets, but we felt it was in the best interests for our company. In certain parts of Asia, specifically China, the air quality has become such a problem that media and governmental agencies are talking about it daily, reinforcing the need for high-quality, air-cleaning products like those we manufacture.
Q: What is the one question a company should ask regarding doing business internationally?
LOBDELL: Everything overseas generally costs a lot more to accomplish. You have shipping, duties, customer support, and many other things to consider when looking at international business. The first question should be: do we understand the needs in the local market we are considering entering? Then, do our products or solutions solve that need? If our products or solutions have value in a market, we then look at to see if we can be priced competitively, especially in more price-sensitive markets where air quality is a big concern like India and China. Once we have determined we can play competitively in that space, we begin interviewing potential partners that have a strong understanding of the culture and the market. Establishing a corporately owned distribution company in an international market can be very problematic as a small company, due to the learning curve it takes to adapt to the unique nuances of every country.
Q: What are the biggest obstacles you faced with going international?
LOBDELL: The benefit of being a small company is you can be very agile, and shift quickly to jump on an opportunity. However, in our industry, there are many options so focus is key. As a smaller company, we sometimes tend to jump into a market without doing a lot of market research. A big opportunity is brought to us and we move. Recently, we jumped into a market to try to grab a substantial share of the market without truly understanding the cost to develop the opportunity. It ended up taking a lot more of our leadership’s time and financial resources than originally anticipated. I think if we would have understood the Indian market better we would have been more in tune with the bottlenecks we faced, and may not have decided to allocate as much time and money once we saw the challenges facing us. In addition, I don’t think we were prepared to do business the way the Indian culture is used to. It’s common practice to have a committed payment drag out 90-plus days, which can really affect the cash flow and development of a smaller company.
Q: How important is it to know a foreign language and understand a foreign culture to go international?
LOBDELL: Nowadays, knowing a foreign language is not a necessity, but is looked upon highly among people from international markets. With all the new software programs, translation services, and support on local levels, language barriers can be minimized. I would say, however, that speaking with someone in their native tongue builds immediate credibility and rapport. Understanding culture is an absolute must. Simple cultural mistakes can happen quickly and ruin a relationship that took lots of time and money to develop. Market research can help you better understand cultural nuances and provide insight on the “do’s and don’ts” before you make a costly mistake.
Q: How have you engaged with international companies wanting to come into the U.S.?
LOBDELL: We have some niche industry penetration in the water-treatment market where our products are sold as an ancillary add-on to the water-treatment sale. We have worked with companies that had non-competing products and were interested in doing similar things. Recently, we worked with a Japanese company that was looking for a U.S.–based distributor for its sensing modules. We had a strategic need for sensing on our commercial projects, yet didn’t have the resources, both time and financial, to commit to developing one internally. As a result of our encounter with this Japanese firm, we created a joint venture that helped fulfill both of our needs. It picked up distribution in the U.S. under a private-label arrangement, and we got to market quicker with a Healthway-branded sensing mechanism not previously seen in the U.S. market that was more cost-effective and innovative.
Q: Why is Central New York a region worth promoting outside the U.S.?
LOBDELL: Central New York is an amazing place to have a business. We have a tremendous workforce to draw from and a supportive business environment — from CenterState CEO, to Empire State Development, to the Syracuse Center of Excellence. Each of these resources plays an increasing important role as you grow. We have also found the banking environment to be supportive and understanding regarding smaller growing businesses in need of cash. Central New York also offers a lot in terms raising a family, including a low cost of living and extra curricular activities both indoors and outdoors.
Mark Lesselroth is founder and principal of Brenner Business Development, an international business development consultancy focused on helping small and mid-size businesses in the U.S. explore international opportunities as well as helping foreign owned companies gain market entry into the U.S. Contact him at mark@brennerbd.com.