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                                                                            BULLETIN



                                        Intellectual property rights
                                   part 5: Licensing and franchising




                                Building bridges with Bosnia’s BSOs




                                                                       Even in the blossoming flower markets
                                                                       success may come and go
September/October 2006 No 311




                                     Pipes and Process Equipment,
                                                        India rising   Never a bed
                                                                       of roses
The CBI: Your European Partner
for the European Market

The CBI (Centre for the Promotion of Imports from developing
countries) is an agency of the Dutch Ministry of Foreign Affairs.
The CBI was established in 1971. The CBI’s mission is to
contribute to the economic development of developing coun-
tries by strengthening the competitiveness of companies from
these countries on the EU market. The CBI considers social
values and compliance with the most relevant environmental




                                                                            p8
requirements to be an integral part of its policy and activities.


The CBI offers various programmes
and services to its target groups:


Market Information
A wide variety of tools to keep exporters and Business Support
Organizations in developing countries in step with the very
latest developments on the EU market.


Company Matching
The company matching programme links well-versed suppliers
in developing countries to reliable importing companies in the
EU and vice versa.


Export Development Programmes (EDPs)
EDPs are designed to assist entrepreneurs in developing
countries in entering and succeeding on the EU market and/or
in consolidating or expanding their existing market share.




                                                                      p15
Training Programmes
Training programmes for exporters and Business Support
Organizations (BSOs) on, among others, general export
marketing and management; trade promotion; management of
international trade fair participation, and developing
client-oriented market information systems.


BSO Development Programme
Institutional support for capacity building for selected
Business Support Organizations.


For detailed information on all CBI programmes and services,
visit the CBI website at www.cbi.nl


Please write to us in English, the working language of the CBI.



Mailing address
The CBI, P.O. Box 30009, 3001 DA Rotterdam, The Netherlands
Phone +31 10 201 34 34, Fax +31 10 411 40 81
                                                                                 p18
E-mail cbi@cbi.nl, Internet www.cbi.nl


Office
WTC-Beursbuilding, 5th floor, 37 Beursplein, Rotterdam,
The Netherlands


Editorial staff
H. Verhoeven (Editor-in-chief), J. Vereijken (Editorial Management)
L.P. den Hollander (Editorial Production) S.D. Teeuwen (Editor)


Circulation 7300, Frequency 6 times annually




                                                                            p29
Editing and layout Admix / Procomm, Rotterdam
Print OBT bv, Den Haag
contents   4
           6
           8
                  Export Marketing & Management
                  The CBI consultant, Milco Rikken: Never a bed of roses
                  Part 5 of a series on intellectual property: Licensing and franchising
                  Conducting business with clean hands: Corporate Social Responsibility

                  European Market Information
           12     Ins & Outs: A series on CBI market information, your online data source
           13     Breaking down the Novel Food barrier
           15     Not made in the EU, new origin marking regulations
           16     EU market survey Natural Ingredients for Cosmetics: Natural sells best
           17     EU market survey on Automotive Parts and Components: Deals on wheels

                  CBI News
           18     The thrills of outsourcing with the CBI, focus, quality and confidence
           20     Building bridges with Bosnia’s BSOs, a development programme in Bosnia and
                  Herzegovina

                  PROMOTIONAL EVENTS
           21     Medica 2006: Still gaining popularity
           22     Midest 2006: Preparing for the world’s leading industrial subcontracting fair
           22     Valve World 2006: Specialists only
           23     Electronica 2006: Three CBI Pavilions

                  TECHNICAL ASSISTANCE / COMPANY VISITS
           24     A new CBI programme for the medical sector: Tough operation ahead
           26     Pipes and Process Equipment: India rising
           28     Electronic markets are calling for you
           29     Destination West Africa, a clever regional tourism package

                  SEMINARS AND WORKSHOPS




                                                                                                  CBI News Bulletin 2006
           31     Export Chameleons in the CBI’s Expro 56 seminar for medical devices

           33     Trade Fairs and Conferences
           34     Ongoing and planned CBI activities
           36     List of current CBI publications



                                                                                                  September/October Page 3




           Cover photo:
           The CBI consultant Milco Rikken, never a bed of roses (photo: Procomm
           Communicatieproducties Rotterdam, Sjoerd de Jonge).
Export Marketing & Management




                                          Never a bed of roses




                                        Even in the blossoming flower
                                        market, success can be here
                                        today and gone tomorrow,
                                        warns consultant Milco Rikken
     Export Marketing & Management




                                         By Stephen D. Teeuwen


                                     Despite the proverbial transience of flowers – here                from flower growers into highly effective marketing specialists.
                                     today, gone tomorrow – the global floricultural mar-               Those who don´t go along with these changes may soon be out
                                                                                                        of business.” The push to either upscale or specialise – and the
                                     ket is a strong sector that boosts many local econo-
                                                                                                        inevitability of dealing with issues like cost-efficiency and qual-
                                     mies and has shown steady growth for decades. But                  ity management along the way – is the major trend in the Dutch
                                     that doesn´t mean flower export is a matter of just                market today, says Rikken. And he´s one to know. Raised on
                                     picking daisies. On the contrary: as the global market             a Dutch pot plant farm, Rikken, aged 36, has been waist-high
                                     slowly tightens, businesses that fall short in pro-                in foliage all his life. After studying economy and international
                                                                                                        relations in Rotterdam and Costa Rica, he spent part of his
                                     fessionalism and added value may soon be wither-
                                                                                                        career thus far working as a market analyst at the very heart of
                                     ing, warns market analyst and CBI consultant Milco                 the global flower and plant industry: the Dutch Aalsmeer flower
                                     Rikken.                                                            auction. He already began writing market and feasibility stud-
     CBI News Bulletin Page 4




                                                                                                        ies for the CBI in ´96, and joined the export development pro-
                                                                                                        grammes for flowers and plants in 2003. “What I enjoy about
                                                                                                        the CBI programme is that it encompasses the broader scope
                                     If you want to know what developments await flower exporters       of sector development as well as the more hands-on business
                                     in developing countries, you might get a good idea by looking      of individual company support. Translating sector-wide needs
                                     at the Netherlands. Playing a pivotal role in the world´s flower   into effective strategies for individual companies to me is a big
                                     trade, the Dutch floricultural industry is currently undergoing    challenge.”
                                     major changes. Although flower consumption keeps grow-
                                     ing throughout Europe and the rest of the world, margins are       Reverberations in Africa
                                     steadily shrinking and Dutch flower farmers are looking for        If his own forecast is correct, Rikken and his CBI colleagues will
                                     solutions, says Milco Rikken. “We´re seeing many Dutch firms       have a lot of ´translating´ to do within the flower programme.
                                     either upscaling – in which case their preferred distribution      Because the impending shakeout in the Dutch market is bound
                                     channel is often the supermarkets – or specialising in niche       to reverberate further afield in the second tier of exporters
                                     products or methods, which usually means they sell through         – from big-timers Kenya, Israel and Colombia to smaller players
                                     the Dutch auctions because special products tend to fetch a        like Ecuador, Uganda, Zambia, Zimbabwe, Egypt and Ethiopia.
                                     higher price there. Some have had to transform themselves          “In Kenya, which is Europe´s largest flower supplier from the
                                                                     in the scramble for long-term success. The first is what he calls
                                                                     ´having the courage to choose a strategy´. “Too many farmers
                                                                     in developing countries don´t choose a strategy. Either they
                                                                     think they´ll be fine doing what they´ve always done but just
                                                                     doing it a little better, or they´re afraid to focus on one window
                                                                     of opportunity because it means closing another. But in order
                                                                     to succeed, you have to choose. It involves tough questions like,
                                                                     ´Am I a grower or a marketeer? Could my farm excel with cer-
                                                                     tain special varieties or should we aim for high volumes of more
                                                                     common varieties? ”
                                                                     Rikken tells exporters they have to look outward as well as
                                                                     inward. “The best thing to do is start by looking at the mar-
                                                                     ket and finding out what´s really happening out there. For
                                                                     instance, many African exporters are unaware of the fact that
                                                                     Europe has two very distinct distribution channels: the super-
                                                                     markets and the specialised channel, which comprises mainly
                                                                     small flower shops. They are so different, you can´t possibly
                                                                     aim for both. So in the CBI programme we help exporters find
                                                                     out what the differences are. Then we encourage them to take
                                                                     that information and compare it with their own profile. Once
                                                                     they´ve made a choice, it will be much easier to create a more
                                                                     stream-lined organisation.”
                                                                     The second key to success is teamwork. Rikken: “Farmers that
The CBI consultant Milco Rikken (photo: Procomm
                                                                     work together stand a far better chance of acquiring a good
Communicatieproducties, Sjoerd de Jonge).
                                                                     position on the market and keeping it than loners.”
                                                                     The third key to success has to do with cross-continent team-
                                                                     work. Rikken: “We´ve found exporters who develop a strong
                                                                     partnership with their importer in Europe are always more
developing world, we´re seeing a similar development as the          successful than those who don´t. You may have an importer




                                                                                                                                            CBI News Bulletin 2006
one I described for the Netherlands”, continues Rikken. “The         or agent who has a good name, but if you´re just one of many
era in which farmers could increase their income simply by           companies in his portfolio, your business won´t get the atten-
cultivating more land and growing more flowers seems to be           tion it needs.”
coming to an end there, too. Kenyan farmers who want to stay
at the forefront of the market now face the challenge of making      Market tours
structural internal improvements. The pressure is not as high as     Over the years the CBI has developed an excellent set of tools
it is in the Netherlands, but it may be within the next few years.   to help exporters face these issues head-on. Following previous
                                                                     successes with the Egyptian, Ugandan and Zambian partici-
A few countries, like Ethiopia, which is relatively new on the       pants, this November a group of flower exporters from Kenya
flower market, may still escape the pressure because wages           will join a CBI market tour. During the tour they will not only
there are still so low that they won´t need to worry about their     visit Amsterdam´s Hortifair trade event, but also have meetings
                                                                                                                                            September/October Page 5



margins just yet – but even there the pressure will mount            with importers, breeders, retailers, logistical and other experts
sooner or later.” The two solutions most often applied by Dutch      to find out first-hand how the Dutch and European markets
growers, upscaling or specialising, generally will work in Africa    operate. On top of that, the CBI will enable them to present
or South America, too – provided the groundwork has been             themselves to anyone they wish to invite at a so-called ´meeting
done thoroughly in the areas of production (stems per square         event´ during Hortifair: the CBI will facilitate, but it´s up to the
metre), quality, cost-efficiency, logistics and marketing. Says      participants to identify prospects and prepare a good presenta-
Rikken, “A model we recently developed with the CBI shows            tion.
that a healthy company develops itself consecutively in each of      Meanwhile, back at the farms, another CBI tool is finding good
those five areas. The better your performance in all five areas,     usage: the so-called ´clustered farm visits´, in which farmers
the better your chances.”                                            visit each other´s companies as a group to discuss hot issues.
                                                                     Several participants have already agreed to continue these visits
The courage to choose                                                after the CBI programme ends next year. Says Rikken: “That´s
The CBI´s current flower programme started in 2000 and               what the CBI is all about. Helping exporters in the right direc-
ends in 2007. Participants include growers from Egypt, Kenya,        tion and equipping them to then keeping moving ahead on
Uganda and Zambia. Though conditions and levels of develop-          their own steam.”
ment vary, Rikken has observed three key issues they all face
                                Intellectual property rights, Part 5:


                                Licensing and franchising
                                                                                                                                 By Esteban Burrone, WIPO
Export Marketing & Management
CBI News Bulletin Page 6




                                If you’re company is seeking to expand to foreign        The word license simply means permission: one company
                                markets you have various possibilities. Manufacturing    grants permission to another to do something. In an IP license,
                                                                                         one company grants permission to another to use its IP, to
                                a product domestically and exporting it is, of course,
                                                                                         which it has exclusive rights. In a licensing agreement there
                                one option. Producing directly on the foreign market     are at least two essential parties: the licensor or the party who
                                is another option which, however, may require major      owns the intellectual property rights (i.e. patents, trademarks,
                                investments. A third option is to partner with other     designs, copyright or trade secrets), and the licensee or the
                                                                                         party who receives rights to use the IP under agreed conditions
                                companies that have the capacity to manufacture,
                                                                                         and in exchange for payment. The payment may take the form
                                distribute or market your product or service in the      of a flat fee or a running royalty – often a percentage or share
                                foreign market. One way of doing that is by providing    of the revenues gained from use of the IP right(s) in question.
                                intellectual property (IP) licenses.                     While an IP license grants the licensee certain rights over the
                                                                                         IP, it does not transfer ownership of the rights: these remain in
                                                                                         the hands of the licensor. You can license companies in your
                                                                                         domestic market, but the focus of this article is on licensing as a
                                                                                         strategy for international expansion.
Four basic conditions                                                In technology licensing the object of the license may be more
For an IP license to be effective, four basic conditions must be     than a single patent. Technology licensing often involves a
met:                                                                 number of patents. It may include different IP rights and may
• the licensor must have ownership of the relevant IP (or            involve the transfer of know-how, trade secrets, operating
  authority from the owner to grant a license);                      manuals, equipment or other. Given the nature of the partner-
• the IP must be protected by law or at least eligible for protec-   ship between the two companies, negotiations may be long
  tion;                                                              and complex and expert support during negotiations is often
• the license must specify what rights with respect to IP it         crucial1. Also, technology licenses are not spot transactions
  grants to the licensee; and                                        that end the moment the agreement is signed; it is generally the
• the payment or other assets to be given in exchange for the        beginning of a long-term partnership. The implementation of
  license must be clearly stated.                                    the agreement may require the sharing of confidential informa-
                                                                     tion, training of professionals by the licensor and other similar
A key decision in any licensing agreement is whether it will         activities that require a high degree of trust and commitment
be exclusive or non-exclusive. If it is exclusive, only one other    from both partners. In some countries, there are regulations on
company will be entitled to exploit the licensed IP right for a      licensing and technology transfer.
given territory; if it is non-exclusive, more than one company
will be licensed. In case of an exclusive license, it mus be clear   If you are considering this option, make sure any contract you
in the licensing agreement whether the licensor will be entitled     draft meets national regulations. For example, certain clauses
to exploit the IP right in any way in the territory for which the    would not be admitted in certain countries for being consid-
license is being granted.                                            ered anti-competitive. As an exporting company you may also
There are many different types of IP licenses: technology licens-    need to license in technology, i.e. to obtain a license to use
es, trademark licenses (often included in franchising agree-         technology owned by others. Always make sure both the licen-
ments), publishing and entertainment licenses, merchandising         sor and the licensee have obtained all the necessary licenses to
licenses and more. Which type is relevant for you, depends on        export to a given market. If you don’t, you may get into trouble.
the sector in which you’re operating.                                In particular, you should note that technology that is used in
                                                                     the public domain (i.e. unprotected) in a given country may
Technology licensing                                                 have been patented in a given export market, in which case a
For a good example of technology licensing, let’s take a look        license is required for that market.
at the Croatian pharmaceutical company Pliva. In 1980s Pliva
developed an original antibiotic named azythromycin. From            Franchising
early trials, azythromycin proved to be an extremely efficient       The history of Nando’s chicken, a chain of fast-food restau-
antibiotic with the characteristic of remaining in the body tis-     rants, began in Johannesbourg, South Africa, in 1987 when
sue of animals longer than other similar antibiotics. At the time,   Fernando Duarte and Robert Brozin set up their first restaurant
however, the Croatian firm was a small player compared to the        selling spicy chicken according to a well-kept secret recipe.
leading global pharmaceutical firms. There was a lot of foreign      Over the following 19 years, Nando’s became one of South
market potential, but Pliva lacked the capital to commercialise      Africa’s best known brands and a global company with over
its product. Pliva decided to patent azythromycin in various         200 restaurants around the world. Like many other well-known




                                                                                                                                                  CBI News Bulletin 2006
markets of interest, including the United States and a number        fast-food concepts, the international expansion of Nando’s was
of European countries, hoping a partner capable of commer-           based on a franchising model, which enabled it to use its trade-
cialising the product in those markets would emerge. Shortly         mark and successful business model as a basis for contractual
afterwards, scientists from a large pharmaceutical multina-          agreements with local entrepreneurs.
tional came across Pliva’s patent while searching the US Patent      Franchising may be defined as a contractual arrangement
and Trademark Office database. They realised the enormous            under which one enterprise (the franchisor), which has devel-
potential of the antibiotic.                                         oped a system for conducting a particular business, allows
                                                                     one or more other enterprises (the franchisees) to use that
Talks between the two firms eventually led to a licensing agree-     system in accordance with the prescriptions of the franchisor,
ment through which Pliva granted the other company the               in exchange for a monetary consideration. At the core of the
exclusive right to commercialise the patent (i.e. to produce         franchising arrangement is a license agreement, granted by
                                                                                                                                                  September/October Page 7



and sell the new antibiotic) in various markets in exchange for      the franchisor to the franchisee, to use its trademark and the
royalty payments. Pliva, however, maintained the right to sell       franchised system. In a franchising relationship, the parties
the product in Central and Eastern Europe under its own brand        have a close working relationship defined by the terms of the
name. The antiobiotic went on to become a best-selling drug          franchise agreement. The income of each party is dependent
that enabled Pliva to expand significantly and to earn revenues      on the combined efforts of both parties. The more successful
from markets it could not have exploited on its own.                 the franchisee’s business becomes, the greater the income for
                                                                     both parties. The franchisee’s success is also dependent on
Expansion opportunity                                                the franchisor’s ability to develop a profitable system, train the
The case of Pliva illustrates how owning valuable IP (in this case
a patent) and licensing it to a business partner can become
an opportunity for international expansion. The Croatian
company lacked the manufacturing capacity, the financial             1)Guidance   on the negotiation of technology licensing agreements may be
resources and even the expertise to commercialise its product        obtained from two WIPO publications on this subject matter.
in attractive markets such as the US and Europe, but its patents     WIPO publication 903 “Successful Technology Licensing” and WIPO publica-
represented an important asset that attracted the attention of a     tion 906: “Exchanging Value – Negotiating Technology Licensing Agreements:
company that did have those qualifications.                          A Training Manual”. Visit http://www.wipo.int/ebookshop for information.
                                franchisee to properly operate the system, advertise the trade-
                                mark, improve or promote the concept, and support the fran-
                                chisee for the duration of the franchise agreement to achieve



                                                                                                           Conducting
                                continued success.

                                A clear brand image
                                Franchises are common in a wide variety of sectors. The best



                                                                                                           clean hands
                                known are probably fast-food restaurants; however, franchis-
                                ing is common in clothing and shoe stores, drug stores, hotels,
                                insurance companies, accounting and tax services, business
                                and management consultancies, education and training, fash-
                                ion, leisure and sports, travel agents and even laundry and dry-
                                cleaning businesses. For a business to be franchisable, it must
                                be a credible business with an identity that is clearly differenti-
                                ated from that of its competitors (brand image), a standardised
                                operating system which is properly documented and which can
                                be passed on to a new franchisee within a short period of time.
                                Above all, the business must be capable of providing a much-
                                higher-than-average return on the franchisee’s investment.
                                Besides the trademark, franchising may also involve the licens-
                                ing of a number of other IP rights, such as trade secrets (e.g.
                                Nando’s chicken recipe), or any patents, copyright or industrial
                                designs that may be owned by the franchisor and are required
                                to operate the franchise. In many countries, franchising is
                                heavily regulated. It is important to become familiar with local
                                franchising regulations. Like technology licensing, franchis-
                                ing may also be used in the domestic market. Internationally
                                known franchises usually spread within their domestic markets
                                before establishing a presence in foreign countries.
                                Trademark licensing sometimes occurs on its own, without
                                the license over the entire franchise system. As in franchises,
                                the licensor maintains some degree of control over the qual-
                                ity of the products sold under the trademark by the licensee.
                                Trademark licensing agreements will indicate in what way the
Export Marketing & Management




                                licensor will exercise that control, so as to ensure that the repu-
                                tation of the trademark is not damaged.

                                Conclusion
                                Depending on the sector and business strategy of your com-
                                pany, licensing may be an appealing strategy for international
                                expansion. A pre-requisite, however, is that your company
                                owns valuable intellectual property rights, such as a patent over
                                useful technology or a trademark that has acquired a certain
                                reputation. Second, you need to have taken steps to ensure that
                                your IP is protected in the relevant foreign markets. At the heart    Corporate social responsibility (CSR) is hot. In
                                of any IP licensing agreement is the fact that it allows you as a
                                                                                                      the previous CBI News Bulletin we published the
                                licensor to obtain revenues from the licensee while
                                retaining ownership of the underlying intellectual property           first in a series of articles on this issue. It covered
CBI News Bulletin Page 8




                                right.                                                                various initiatives from the agricultural sector (fish,
                                                                                                      cocoa, coffee, tea and palm oil), in which criteria and
                                               About WIPO                                             methods are being developed for raising the level
                                   The World Intellectual Property Organisation (WIPO) is             of social responsibility throughout the whole
                                   an international organisation dedicated to promo-                  production chain. In this article we will zoom in
                                   ting the use and protection of works of the human spirit.          on a few consumer sectors, where the same
                                   With headquarters in Geneva, Switzerland, the WIPO is
                                                                                                       developments can be seen, although the reasons for
                                   one of the 16 specialised agencies of the United Nations.
                                   It administers 23 international treaties dealing with dif-
                                                                                                      the initiatives might differ.
                                   ferent aspects of intellectual property protection. The
                                   organisation has 183 member states. For more informa-
                                   tion, go to www.wipo.int./sme/en or contact the author
                                   of this article at esteban.burrone@wipo.int This series is
                                   a co-production of the CBI and the WIPO.
                                                                                          from you and you can benchmark your
                                                                                          own factory against those requirements
                                                                                          to assess your suitability as a trading



 business with
                                                                                          partner.

                                                                                          Questionnaires and tools
                                                                                          The initiatives listed below provide



s
                                                                                          a useful starting point for exporters.
                                                                                          Many of them provide self-assessment
                                                                                          questionnaires and/or risk assessment
                                                                                          tools that are useful to exporters seeking
                                                                                          a perspective on the type of improve-
                                                                                          ments they will need to make to comply
                                                                                          with industry best practice. If you want
                                                                                          to develop your own code of conduct,
                                                                                          you can refer to the code of conduct for
                                                                                          your industry. Another approach is to
                                                                                          adopt the industry code in its entirety.
                                                                                          Awareness of and adherence to these
                                                                                          codes of conduct will impress both cur-
                                                                                          rent and prospective buyers.

                                                                                          Don´t forget this
                                                                                          There are several points you should
                                                                                          remember as an exporter:
                                                                                          • All codes and standards require that
                                                                                            exporters meet (or exceed) local laws.
                                                                                          • The majority of sector codes are based
                                                                                            on conventions of the International
                                                                                            Labor Organisation (ILO), and the
                                                                                            Universal Declaration of Human
                                                                                            Rights. As a result, many codes of con-
                                                                                            duct are quite similar.
                                                                                          • In addition to sector codes, there are
                                                                                            also general codes, such as Social
                                                                                            Accountability 8000 (SA 8000), used
                                                                                            worldwide, and the Business for Social




                                                                                                                                       CBI News Bulletin 2006
                                                                                            Compliance Initiative (BSCI) that many
                                                                                            European retailers are using for sour-
                                                                                            cing a very wide range of products.
                                                                                          • European buyers will check for social
                                                                                            compliance if they visit your company
                                                                                            by inquiring after codes, policies or
                                                                                            simply by addressing their common
                                                                                            sense. They will consider your social
 Corporate Social Responsibility is hot in                                                  standards an integral part of the final
                                                                                            quality of your products.
 clothing, toys, sports and electronics                                                   • Adhering to codes of conduct involves
                                                                                                                                       September/October Page 9



                                                                                            a process. Buyers will look for evidence
 By Deborah Leipzieger
                                                                                            that your company is aware of the
                                                                                            industry´s code of conduct and wor-
 As European consumers steadily raise         goods, toys and electronic goods sectors      king to implement it. The sooner you
 their quality demands as well insisting      in this article.                              find out about the process for checking
 that the things they buy are produced        With more and more sectors – from             compliance and the corrective actions
 under acceptable social conditions,          clothing to toys – formulating joint ans-     needed, the better it is, as buyers will
 exporting to the European Union is           wers to these questions of conscience,        be looking for signs of progress and
 becoming more complex. Increasingly,         corporate social responsibility (CSR)         continuous improvement.
 European retailers want players right        has become a token of coolness. The
 down the supply chain to adhere to strict    good news for exporters is that many of     Branded goods
 social standards, such as safe working       these CSR initiatives provide them with a   Branded goods tend to face the highest
 conditions, no child or forced labour,       wide range of resources in terms of both    level of consumer scrutiny. Clothing,
 no discrimination against women or           information and training. In some sec-      sporting goods, toys and electronic pro-
 minorities. Find out more about some of      tors, information and advice abound on      ducts by now have all been subjected
 the initiatives for the clothing, sporting   what your European buyer might expect       to media exposure in relation to CSR
                                                                                                                           Sports goods
                                                                                                                           The World Federation of the Sporting
                                                                                                                           Goods Industry Model Code of Conduct
                                                                                                                           Along with the garment sector, the
                                                                                                                           sporting goods industry has been under
                                                                                                                           CSR pressure as well. Negative media
                                                                                                                           coverage and demonstrations, for instan-
                                                                                                                           ce during the Olympics and World Cup
                                                                                                                           events, have roused the sector to action.
                                                                                                                           The World Federation of the Sporting
                                                                                                                           Goods Industry (WFSGI) consists of mul-
                                                                                                                           tinational corporations, national firms,
                                                                                                                           and exporters from over 50 countries.
                                                                                                                           The Federation represents more than
                                                                                                                           12,000 companies. The sector includes
                                                                                                                           producers of sports footwear as well as
                                                                                                                           sports equipment, such as footballs,
                                                                                                                           along with clothing used by athletes.
                                                                                                                           Because its members produce goods
                                                                                                                           across a wide range of product lines, the
                                                                                                                           WFSGI has a role to play in providing
                                standards. To avoid negative media         shareholders with information. Some of          guidance in harmonising various initi-
                                coverage and subsequent harm to com-       the most well-known brands within the           atives. Together with the International
                                panies or even entire sectors, many        FLA network include Adidas AG, Asics,           Labour Organisation, Save the Children
                                industry groups have responded by draf-    Eddie Bauer, H&M Hennes & Mauritz,              Fund UK, and UNICEF, the WFSGI has
                                ting a code and, in some cases, a system   Liz Claiborne, Nike, Puma and Reebok.           developed a project to combat child
                                for monitoring and auditing social com-                                                    labour in the production of footballs.
                                pliance.                                   More information: www.fairlabor.org.            The federation has a handbook available
                                The clothing sector has responded to                                                       for exporters of sporting goods that deals
                                CSR pressure in several ways, including                    Worldwide Responsible           with its Model Code of Conduct. The
                                the establishment of the Fair Labor                        Apparel Production (WRAP)       WFSGI is one of the initiatives with the
                                Association (FLA) and the Worldwide                        The WRAP is a                   longest history.
                                Responsible Apparel Production (WRAP).                     certification system that has   Apart from checking out the WFSGI for
                                Other sectors have developed codes of      developed a set of principles, which have       more information, you may find also
Export Marketing & Management




                                conduct. The sporting goods sector has     been endorsed by the American Apparel           it useful to look at individual company
                                the World Sporting Goods Federation        Manufacturing Association and apparel           websites in this sector, such as Adidas
                                Industry Model Code of Conduct.            manufacturers in fourteen countries.            and Nike.
                                The toys sector uses the International     Unlike most other initiatives described in
                                Council of Toy Industries CARE Process.    this article, the WRAP includes not only        More information: www.wfsgi.org.
                                And the electronic products sector has     social issues, but also environmental and
                                set up the Electronics Industry Code of    customs issues and drug interdiction.
                                Conduct.                                   WRAP provides several useful services           Toys
                                                                           for exporters, including a handbook             International Council of Toy Industries,
                                              Clothing                     for certification and round-the-world           Care Process
                                              Fair Labor Association       training programmes. It also offers a           Reports on labour violations in toy
                                              (FLA)                        self-assessment package for sewn pro-           factories have circulated all over the
                                              The FLA is an American       ducts in Chinese, English, Russian, and         world, increasing the demand for socially
                                network of companies, human rights and     Spanish, which can be downloaded from           responsible practices in this industry.
CBI News Bulletin Page 10




                                labour organisations, and colleges and     their website. The handbook and the             The intent of the CARE process is to
                                universities seeking to improve working    self-assessment guide are very useful for       provide a fair, thorough, and consistent
                                conditions.                                gaining understanding of how European           programme for monitoring toy factories’
                                It was established as an organisation in   buyers will assess your company. It deals       compliance with the Code of Business
                                2000, after US president Clinton con-      with questions like: what are their expec-      Practice. CARE stands for Caring,
                                vened the Apparel Industry Partnership     tations of you as a supplier? How are           Awareness, Responsible, and Ethical.
                                to address the issues of workers’ rights   they going to check compliance? What            Factories pay a fee to the ICTI and then
                                in 1996. The FLA has a code of conduct     will be a possible certification proce-         select an ICTI-accredited firm to conduct
                                based on ILO conventions. It performs      dure? Even if you don´t (yet) produce           an audit.
                                independent monitoring and verifica-       according to the WRAP principles, you´ll        The International Council of Toy
                                tion to ensure that the FLA’s Workplace    find the information very practical.            Industries is a group of toy associa-
                                Standards are upheld where FLA com-                                                        tions from 18 countries. Founded in
                                pany products are produced. Through        More information: www.wrapapparel.              1995 by the International Council of
                                public reporting and the so-called FLA     org. The handbook and self-assessment           Toy Industries, the CARE process is a
                                Online Factory Disclosure Database,        guide are available in the download sec-        certification scheme. The initiative focu-
                                the association provides consumers and     tion (handbooks).                               ses mainly on China, Hong Kong, and
Macau, where the majority of toys are         policy for any instance, isolated or not, of   In this phase of transition, there is a role
manufactured. Over 122 brands partici-        employee treatment that could be inter-        for exporters to play in providing feed-
pate in the initiative, including Mattel.     preted as harsh.                               back on how codes and initiatives can be
The CARE Process addresses primarily                                                         more helpful or appropriate to the needs
social issues, such as health and safety      More information: www.eicc.com.                of factories in developing countries.
conditions and respect for local laws.
The issue of freedom of association is        Early stages                                   For more information on these topics,
only related to local law. No reference is    To a large extent, sector initiatives are      check the CBI market information data-
made to the issue of wages.                   still in the early stages of development       base at www.cbi.nl/marketinfo (type
The ICTI has translated its code into         and will continue to undergo a phase of        of information: market access require-
French, German, Spanish, and Chinese.         intense transition. Many are collabora-        ments/non-legislation). You can also
You can read the code on its Internet         ting on joint initiatives to develop more      send your questions to marketaccess@
site. It deals with the most important        consistent approaches to monitoring.           cbi.nl.
social issues in the toy sector and is a      Demand is growing for these sector
good way of checking your social perfor-      initiatives to become more transparent,        The author is managing director of the
mance as a toy company. The website           with more information available online.        Anders & Winst Company.
also presents a methodology for evalua-
ting compliance, an audit checklist that
you can use yourself, a guidance docu-
ment and a corrective action plan. There
is also a Fire Prevention and Emergency
Preparedness Guide.

More information: www.icti-care.org.




Electronics
Electronics Industry Code of Conduct
(EICC)
Founded in 2004 by a joint initiative of
electronics manufacturers HP, IBM, Dell,
Jabil and a few others, the Electronics
Industry Code of Conduct covers social
and environmental issues, as well as
business ethics and national law. Since
its inception, many of the leading com-




                                                                                                                                            CBI News Bulletin 2006
panies in the sector have joined the initi-
ative, including Microsoft, Philips, Intel,
and Sony.
The Code is a total supply chain initi-
ative. As such, exporters working with
the EICC require their suppliers also to
acknowledge and implement the code.
Its main features are labour standards,
health and safety standards, environ-
mental standards, management system
requirements and ethical standards.
                                                                                                                                            September/October Page 11



The EICC is currently developing a risk
assessment tool that will be helpful
for exporters. A self-assessment tool is
also available on the EICC’s website in
Spanish, Chinese, and English.
The EICC initiative is relatively new and
therefore its market impact is still limi-
ted. However, the importance of labour
conditions in the electronics sector was
highlighted in late August 2006, when
the British newspaper Mail on Sunday
ran an exposé of a Chinese iPod factory
that manufactures for Apple. As a result
of media scrutiny, Apple admitted that
the supplier’s working hours were exces-
sive. Apple says it has a zero-tolerance
European Market Information
                                                                                 Ins & outs, a series of articles on CBI market information, gives you insight into
                                                                                 how the CBI develops and maintains its market information, where you can find
                                                                                 it and how to use it. In Part 3 we will give an outline of the advantages of online
                                                                                 information available through the CBI´s market information database and some
                                                                                 recommendations on how to use that information. If you have any questions or
                                                                                 suggestions regarding market information, please contact us – your remarks
                                                                                 may be published in the next installment.


                                     Ins & outs, Part 3: the CBI´s market information database and how to use it


                                  Your online data source
                                  By Ariane van Beuzekom


                                  Much of the market information you need as an exporter or business                               market and select the country report
                                                                                                                                   listed on the right side of the page
                                  supporter exploring the possibilities of accessing European markets
                                                                                                                                   under ‘related documents’.
                                  is provided by the CBI. We´ve divided our market information into four
                                  separate categories: market access requirements, market surveys,                               Reading guidelines
                                  marketing guidelines and manuals. All four are accessible through a                            The CBI´s guidelines are not very lengthy
                                  single database. Here´s the URL to remember: www.cbi.nl/marketinfo.                            documents, so you can easily scroll
                                                                                                                                 through them. If you´re looking for
                                  It´s your gateway to the goldmines.
                                                                                                                                 something very specific, use the binocu-
                                                                                                                                 lars button for a keyword search within
                                  In recent years the CBI has worked hard          the text containing your keyword. This        the text.
                                  at digitalising the information previously       is also a quick way of skimming over a
                                  contained in hardcopy manuals, surveys           text. For instance, if you´re looking for     Reading manuals
                                  and quick scans. Providing digital infor-        nitrates limits in a EU Directive of over     Like the market surveys, many of our
                                  mation through the Internet has many             50 pages, use the binoculars to search for    manuals contain a table of contents
                                  advantages:                                      ‘nitrate’ and jump through the text until     through which you can go directly to the
                                  1. Digital information can be updated any        you see the limits you´re looking for.        section you´re interested in. Otherwise,
                                     time, which means we can always strive                                                      use the binoculars to skim the text or
    European Market Information




                                     to keep you updated on the very latest        Reading market access requirements            scroll down.
                                     developments. On your side, this means        Our documents on market access are
                                     you have to visit the database regularly      not very long and therefore easy to go        Download problems
                                     to check for new data.                        through. However, we do strongly rec-         If you´re having trouble downloading
                                  2. Digital information can be accessed any       ommend that you always use the filter         information, try the following:
                                     time anywhere, as long as you have a          on the ´search results´ page to separate      1. In case of an error notification, con-
                                     computer and an Internet connection.          legislation and non-legislation docu-             tact us by email and let us know what
                                     No more visiting libraries and toting         ments. For market access the full scope           went wrong. If possible, email us the
                                     heavy loads of paperwork home with            is important. Also check the related doc-         error message so we can investigate
                                     you - all you have to do is click and the     uments mentioned on the introduction              ourselves. Adding details of your
                                     information is at your fingertips.            page of the document you´re reading.              Internet explorer and computer sys-
                                  3. As the Internet´s countless websites          These related documents are carefully             tem will also help.
                                     provide much more additional infor-           selected and give additional information.     2. If you get a time-out because a docu-
    CBI News Bulletin Page 12




                                     mation, the CBI information is linked                                                           ment is too large to download, email
                                     to a selection of many other relevant         Reading market surveys                            us and ask for a copy of the informa-
                                     Internet sites, which will save you time      There are several ways of going through           tion. We will either send you the docu-
                                     surfing the net yourself.                     our rather bulky market surveys:                  ment by email or send a hard copy
                                                                                   1. Download the whole pdf, go to the              through the post.
                                  How to read Internet information                    table of contents and click on any
                                  The CBI´s database is huge. The follow-             chapter to directly access that chapter.   Add to favourites:
                                  ing tips may make searching and reading             This will save you a lot of time scroll-   www.cbi.nl/marketinfo
                                  information a lot easier.                           ing for the right section.
                                                                                   2. If you know beforehand that you want       Email addresses:
                                  Use the binoculars                                  to read a specific part of a survey, do    marketaccess@cbi.nl, for questions on
                                  If you´re reading long pdf documents or             not download the whole publication         market access information
                                  other long texts provided through links             but select the chapter(s) of your inter-   marketinfo@cbi.nl for questions on mar-
                                  on our website, use the binoculars button           est to reduce downloading time.            ket information
                                  to search for a keyword within the text.         3. If you want information on a specific
                                  The cursor will show you all the places in          country, go to the survey on the EU
                                                                                 Breadfruit (Artocarpus altilis), an age-old
                                                                                 natural fruit with many healthy character-
                                                                                 istics and appliances, is considered a novel
                                                                                 food in the EU. Simply because we don’t
                                                                                 know it…



                                                                                 Since the workshop in Brussels,
                                                                                 UNCTAD and CBI have been working
                                                                                 closely with country representatives and
                                                                                 Biotrade programme counterparts to
                                                                                 create a platform for further discussions
                                                                                 on the Novel Foods Regulation. Various
                                                                                 briefing sessions have been organised,
                                                                                 some including the EC. Countries from
                                                                                 Southern Africa and Latin America have
                                                                                 taken an active stance on the matter over
                                                                                 the last few months.

                                                                                 Active Andean countries
                                                                                 The Andean countries, particularly
                                                                                 Colombia, Ecuador and Peru, tabled the
                                                                                 issue in the Committee on Sanitary and
                                                                                 Phytosanitary Measures of the World
                                                                                 Trade Organisation. During its March
                                                                                 and June meetings these countries
                                                                                 brought to the attention their specific
                                                                                 trade concerns regarding the NFR and
                                                                                 expressed the view that the NFR runs
                                                                                 counter to the WTO Agreement of
                                                                                 Sanitary and Phytosanitary Measures.
                                                                                 They therefore welcomed the revision
                                                                                 process the EC is currently undertaking
                                                                                 and requested the EC to speed up this
                                                                                 process and exempt traditional exotics


Breaking down the                                                                during the process (see http://www.bio-
                                                                                 trade.org/News/News%20Release.htm




                                                                                                                                CBI News Bulletin 2006
                                                                                 for more information)


novel food barrier                                                               Andean countries also coordinated
                                                                                 their efforts by hosting a dégustation
                                                                                 event of exotic foods at the European
The CBI and UNCTAD attempts to get EU markets                                    Commission’s Directorate-General for
more accessible continue                                                         Agriculture and Rural Development. The
                                                                                 food exhibit was held during an event
                                                                                 called ‘Fruits and other exotic products
                                                                                 of the Andean Community (CAN) and
                                                                                 quality products from the European
                                                                                                                                September/October Page 13



                                                                                 Union’. (see http://www.biotrade.org/
                                                                                 News/News%20Release3.htm for more
                                                                                 information)
The CBI and UNCTAD, the United Nations Conference on Trade and                   With financial support from UNCTAD,
Development, are working together in the joint BioTrade Facilitation             Colombia, Ecuador and Peru also pre-
Programme aimed at assisting exporters in several developing countries in        pared trade impact assessments to give
                                                                                 better insight in the socio-economic
creating biotrade market opportunities. Last year the two agencies joined
                                                                                 impacts of the NFR.
forces to inform the European Commission (EC) on the adverse effects of          Finally, the Peruvian Institute for Natural
the Novel Foods Regulation (NFR) for some developing country exporters           Products (IPPN) is developing a Novel
of so-called traditional exotic food products. A discussion paper exploring      Food application for yacón, a root that
options for the revision of the Regulation to the benefit of traditional foods   has a long history of traditional use in
                                                                                 Peru. Yacón is already consumed in
was developed from the perspective of developing countries. At a workshop
                                                                                 other parts of the world and market
last December the discussion paper was presented to the Commission               interest is growing, but in the EU it is
along with different stakeholders. New developments are on the way.              regarded as novel food.
                                 Harvesting so called novel foods, a tradition of centuries in many parts of the world.



                              Southern Africa: baobab                        The consultation ran for 8 weeks and           with the requirements of the Regulation.
                              In the meantime, on the other side of          was closed on August 1.                        Because of the platform that exists, the
                              the world, PhytoTrade Africa has pre-                                                         CBI and UNCTAD will source informa-
                              pared an NFR application for baobab.           UNCTAD & CBI: guidelines                       tion from partners who already have
                              A BioTrade partner, PhytoTrade Africa          Another new activity is the development        practical experience. The guidelines,
                              – the Southern African Natural Products        by UNCTAD and the CBI of a new set of          therefore, could be of great support to
                              Trade Association – recently submitted         guidelines for exporters in developing         exporters of those specific products
                              its application to the UK Food Standards       countries on how to create a product           intending to export to the EU. The
                              Agency to approve baobab fruit pulp as         dossier needed to enter the European           guidelines are expected to be finalised by
                              a novel food ingredient. The application       market with a new product. These guide-        mid-2007.
                              includes the use of the fruit pulp as a        lines will be accessible for any exporter
                              novel food ingredient for use in a range       and will contain issues such as a clear        For more information on the debate over
                              of food products, including smoothies          outline of the Novel Food application          the NFR go to www.biotrade.org. For
                              and cereal bars, as well as a de-pecti-        process and its different stages as well as    information on EU legislation regard-
                              nised pulp for use in biscuits, confec-        the scope of data needed. Furthermore,         ing novel foods, check the CBI´s market
European Market Information




                              tionery, and other related food products.      the guidelines will present real cases,        information database at www.cbi.nl/
                              (For information on the submission of          offer estimate costs, deal with bottle-        marketinfo.
                              baobab fruit pulp to the ACNFP, go to:         necks and present tips on how to comply
                              http://www.acnfp.gov.uk/assess/fullap-
                              plics/baobab)

                              EC: open consultation
                              On June 2, 2006, the EC launched an
                                                                                How exotic foods got
                              online consultation on the revision of
                              the Novel Foods Regulation, designed
                              to gather input from the general public,
                                                                                blocked out
                              stakeholders and member states. With              Many developing countries are endowed with rich forest and marine biodiversity
                              this information the Commission will              resources. These resources provide the basis for a wide range of products, such as
CBI News Bulletin Page 14




                              carry out an impact assessment for a              nuts, fruits, perfumes, natural dyes, oils, medicinal plants and biochemical com-
                              future legislative proposal to revise the         pounds. Most of these products are used by local populations to make a living,
                              current Regulation. The Commission                while others have served as an important source of innovation for the pharma-
                              was also seeking feedback on how to               ceutical, biotechnology or cosmetic industries. In this context, the challenge is to
                              create a more streamlined authorisa-              find ways and means to use biodiversity as a basis for sustainable development
                              tion procedure, taking into account               and to create trade opportunities.
                              particular needs of traditional exotic            The European Commission´s Regulation EC 258/97 on Novel Food was enacted
                              food from third counties and adjusted to          in 1997 during a period of heated concern over the introduction of genetically
                              applications with several food uses. All          modified (GM) foods in Europe. However, the regulation affects other, less con-
                              partners from the BioTrade Facilitation           troversial foods as well. Under the Novel Food Regulation, a food is classified as
                              Programme were requested to provide               ´novel´ if it was not consumed by Europeans before May 15, 1997. Foods thus
                              input in order to identify the positive and       classified, among which are many biotrade products, must be taken through a
                              negative impact of the proposed policy            complex process before they can be introduced on the European market.
                              options. These contributions will assist          This process is beyond the means of many small businesses from developing
                              the EC in making an informed judge-               countries.
                              ment on the design of its legal proposal.
       Not made in the EU




       Amid concerns about preferential treatment, the EU prepares
       new origin marking regulations




                                                                                                                                       CBI News Bulletin 2006
Amid foreign concerns that Europe           Not allowed                                   A ´buy Europe campaign´
is launching a ´buy Europe cam-             EU Member States are not allowed to           The proposal for a mandatory origin
                                            impose compulsory origin marking on           marking system in the EU is currently
paign´, the European Parliament
                                            goods imported from other Member              restricted to a limited number of import-
is moving forward with a new reg-           States, but there does not appear to be       ed products, such as textiles, jewellery,
ulation concerning the compulso-            a similar express limitation on compul-       apparel, furniture, bedding, brooms
ry marking of products to indicate          sory origin marking on goods imported         and brushes, footwear, leather, lamps
                                            from outside the EU. The Commission           and light fittings, glassware, ceramics
their country of origin.
                                            has expressed concern that this lack of       and handbags. Manufacturers exporting
                                            harmonisation may create disparities          these goods into the EU may be con-
On 6 July 2006, the European Parliament     between regulations in force in different     cerned that the proposed measures will
                                                                                                                                       September/October Page 15



adopted a resolution on origin mark-        Member States as well as an absence of        form part of a pro-EU product campaign.
ing. Origin marking is about marking        clarity at an EU level. For example, the      However, the Commission has stressed
products to indicate where they´re from,    meaning of “made in” differs among            that the proposal is not part of a ´buy
for instance ´Made in the EU´. The          Member States, resulting in very diverse      Europe campaign´ and it remains for
resolution deals with compulsory origin     legal requirements.                           consumers to decide according to their
marking on some products entering the       According to the current proposal, the        preferences.
European Union from third countries. So     definition of the country of origin will be
far, the EU has no uniform practices in     based on the EU non-preferential rules        Misuse
this area, while the United States, Japan   of origin. Therefore, goods will be con-      The proposed regulation also responds
and Canada, among others, report-           sidered as originating in a country if they   to growing concerns from EU Member
edly impose mandatory origin marking        are wholly obtained or produced in that       States over the alleged increase in use of
requirements. The proposed legislation      country. Goods whose production takes         misleading and fraudulent origin mark-
aims at creating a level playing field      place in more than one country will be        ing on imported products. The introduc-
between the EU and those countries.         considered as originating in the country      tion of an origin labelling requirement
                                            where the last substantial transformation     for certain imports is aimed at protecting
                                            occurred.                                     consumer rights by ensuring that mis-
                              leading indications of origin are not
                              used and protecting consumer expec-         The following articles present major facts and figures for some important market s
                              tations whenever there is evidence of       from a new and far more extensive range of CBI market surveys. The CBI’s decis
                              counterfeiting and/or use of fraudulent     surveys means that from this year on we plan to publish an average of 20 to 25 sur
                              or misleading origin markings by pro-
                                                                          European Union as a whole and one for almost every separate EU Member State. To
                              ducers and exporters to the EU. The
                              measures are also intended to promote       site at www.cbi.nl/marketinfo
                              EU consumer choice by allowing them
                              to be fully aware of the country of
                              origin of the products they purchase;
                              allowing them to identify products with
                              the social, environmental and safety
                              standards generally associated with
                              that country. Member States will have
                              individual competence to determine
                              the applicable penalties for failure to
                              comply with the proposed regulation.
                              Importers may have legitimate con-
                              cerns that products entering the EU will
                              be subject to more vigilant and lengthy
                              customs checks, as the Parliament
                              calls for emphasis to be placed on the
                              promotion of EU products and the
                              safeguarding of EU products, and that
                              consistent and transparent trade rules
                              are applied. Recommended ways for
                              this to take place include the setting up
                              of customs surveillance and enforce-
                              ment mechanisms.

                              Legal analysis
                              A number of EU Member States and
                              industry sectors have been persistently
                              calling for mandatory origin marking.
                              The Commission proposal for a ´made         Natural sells
European Market Information




                              in´ regulation which mandates the use
                              of origin marking for imports of certain    NATURAL INGREDIENTS FOR COSMETICS
                              goods was put forward after a lengthy
                              consultation process. The Parliament        The major European markets for cosmetics, such as Italy, Germany
                              has now approved the draft proposal,        and France, all showed either a slight decline or a stagnation in sales
                              making a number of observations and
                                                                          throughout 2004 and 2005. Eastern Europe is one of the fastest growing
                              recommendations.
                              The Parliament has requested that the       markets. Natural cosmetics are doing better than the rest.
                              Commission and the Council now carry
                              out a further impact assessment and a       The cosmetics market of the fifteen coun-    Developing countries
                              legal analysis in relation to the origin    tries formerly comprising the European       The most important markets for natural
                              marking proposals, taking particular        Union is worth € 57 billion, while the       cosmetics ingredients are France, the
                              account of alleged inconsistencies with     new EU member states have a combined         United Kingdom, Italy and Spain. At the
CBI News Bulletin Page 16




                              existing Community legislation and          market worth € 4.2 billion.                  level of product groups, however, some
                              WTO rules. The Parliament registers         The natural cosmetics segment is still       specialisation can be distinguished.
                              that it intends to be involved as far as    relatively small, but is doing better than   Spain, for example, is an important mar-
                              possible in the process concerning          the overall market. The natural cosmet-      ket for raw plant material and natural
                              origin marking, highlighting this as an     ics market continued to benefit from         colours and France for essential oils.
                              issue which is generating considerable      growing global consumer concerns about       Many of the natural ingredients used in
                              political interest.                         health, a sense of well-being and looking    the cosmetics industry are harvested in
                              Once endorsed by the Council, the           good, thanks to burgeoning media focus       developing countries, further processed
                              necessary implementing provisions           on these issues. The natural cosmetics       and re-exported to buyers in Europe. EU
                              will have to be drawn up. The scheme        market is expected to grow by an average     production plays a limited role in essen-
                              is expected to become fully operational     of 9% a year between 2003 and 2008.          tial oils and natural colorants.
                              during the 2nd semester of 2007.            The market for cosmeceuticals – products     The role of developing countries is prom-
                                                                          containing one or more bioactive ingre-      inent for several product groups. Around
                              (Source: Business Alert EU)                 dient – has also been growing strongly.      40% of EU imports of vegetable oils, fats
                                                                          However, value growth is expected to         and waxes, essential oils and raw plant
                                                                          decline significantly.                       material is supplied by developing coun-
                                                                                          market, and the after-market. Both mar-
sectors. The information has been gleaned
sion to intensify its publication of market
rveys annually for each sector: one on the
                                                  Deals                                   kets depend on developments in the
                                                                                          vehicle market.
                                                                                          Consumption of parts and components

 download market surveys, go to our web-
                                                  on                                      showed a steady rise from 1998 to 2002,
                                                                                          with an average annual growth of almost
                                                                                          8%. After a 13% drop in 2003, the market


                                                  wheels                                  grew again in 2004 by 5.5%.

                                                                                          Consumption in 2004 was estimated at
                                                                                          € 260 billion. The strong growth in the
                                                  AUTOMOTIVE PARTS & COMPONENTS           last few years is partly the result of the
                                                                                          increasing role of system suppliers in the
                                                  The number of cars in the European      production of vehicles. Total EU imports
                                                  Union has been growing annually         have been increasing steadily in the past
                                                                                          four years: from € 149 billion in 2000 to
                                                  by 1.5% to 3% for the past six
                                                                                          €186 billion in 2004, an increase of 35%.
                                                  years. In 2004 there were over
                                                  215 million cars in the EU. After-      The trend towards globalisation and
                                                  market sales have grown and are         outsourcing stimulates imports strongly.
                                                                                          After a sluggish period in 2003 (+3%),
                                                  expected to continue doing so.
                                                                                          EU imports in 2004 increased by 10%.
                                                  New cars sales levelled off over        Import growth rates are expected to con-
                                                  the last five years at a relatively     tinue to grow in the next five years at an
                                                  high 15 million units per year.         average of 6% for the whole EU.

                                                  EU imports of automotive parts
                                                                                          Some € 9 billion (4.9%) of total EU
                                                  and components from developing          imports originated in developing coun-
                                                  countries have been increasing by       tries. Imports from developing countries
                                                  an impressive 13% annually over         increased by an impressive 13% annu-
                                                  the past four years.                    ally over the past four years. However, a
                                                                                          massive 67% of this supply was provided



  best                                            The market for automotive parts and
                                                  components can be divided into two
                                                  main segments: the supply to original
                                                  equipment manufacturers, or the OEM
                                                                                          by no more than five countries. The next
                                                                                          five accounted for a further 20%. The
                                                                                          leading supplying countries are Turkey
                                                                                          (24%), China (17%), Brazil (11%), South
                                                                                          Africa (9%) and Tunisia (8%).




                                                                                                                                       CBI News Bulletin 2006
       tries. The share of developing countries
       for vegetable saps and extracts and col-
       ouring matter is above 20%.

       Top products
       In terms of import value, the top-rated
       developing country exports in this
       market are coconut oil, cocoa butter,
       medicinal and aromatic plants and
       essential oils. In terms of the share of
                                                                                                                                       September/October Page 17



       developing countries in EU imports of
       natural ingredients for cosmetics, the
       most important products are coconut
       oil (76%), jasmine oil (76%), vetiver
       oil (70%), peanut oil (69%), geranium
       oil (61%), lemon oil (60%) and waxes
       (52%). The leading developing coun-
       try suppliers of these ingredients
       are China, India, Brazil, Argentina,
       Indonesia and Morocco. On the down-
       side, the share of developing countries
       decreased between 2000 and 2004 for
       some products, notably jasmine and
       coconut oil.
CBI News

                             Sales take off as two exporters embrace the CBI message of focus, quality
                             and confidence


                             The thrills of outsourcing
                             By Stephen D. Teeuwen

                             “A lot of entrepreneurs complain
                             they can´t compete with Chinese
                             prices, or the European market
                             is inaccessible for them. But I´m
                             convinced any company that puts
                             quality before price can compete
                             anywhere in the world.” It may be
                             a bold statement, but CBI consul-
                             tant Staf Henderieckx has plenty of
                             evidence to back it. As the current
                             export development programme
                             for castings and forgings in which
                             he and co-consultant Dick Vos are
                             involved comes to an end this year
                             and a new one is launched, their
                             portfolios are thick with stories of
                             successful CBI outsourcing. Here
                             is a prime example from Colombia.



                             Lavco is a manufacturer of cylinder
                             liners for compressors. Located near
                             Bucaramanga, Colombia, the firm
                             is managed by sisters Olga and Rose
                             Rueda. Their father was the founder. Just
                             a few years ago, Lavco was a high-quality
                             company with about fifty hard-working
                             employees and a mediocre turnover.
                             Selling largely to domestic and regional
 CBI News




                             buyers in the notoriously low-margin
                             automotive sector, Lavco was just not
                             cutting it. Seeing far more potential than   had a magnificent display and were get-      The triple message
                             was being realised until then, consult-      ting all the business, while Lavco´s stand   As the Hanover fair came to an end,
                             ants Staf Henderieckx and Dick Vos           was empty most of the time.”                 interest had still not picked up, but the
                             invited the company to enter the CBI´s       As it turned out, Lavco´s manufactur-        Rueda sisters did seem to have brushed
 CBI News Bulletin Page 18




                             export development programme for             ing was based on centrifugal casting – a     up their self-confidence. “Confidence
                             castings and forgings. Outsourcing, they     procedure that results in outstanding,       is of paramount importance in sales”,
                             knew, would be the ticket.                   unbeatable quality – but the Colombians      says Vos. “Our message always has three
                                                                          were not telling anyone about it. Says       components: specialise in one or two
                             By 2004 the CBI had helped the firm          Henderieckx, “Centrifugally cast cyl-        products, or at the most three; then
                             upgrade itself sufficiently to send a rep-   inder liners are far more durable than       make sure you become one of the best
                             resentation to Germany´s world-famous        any other kind. Every European buyer is      manufacturers of those few products on
                             Hanover Messe trade fair. Lavco had the      looking for that kind of quality, because    the whole market; and thirdly, present
                             makings of a successful exporter to the      replacing worn out liners costs a lot of     your high-quality specialism with confi-
                             EU. But fate would have it differently.      money. But the fact was Lavco was not        dence. A lot of exporters will offer twenty
                             Recalls Henderieckx, “Half-way through       really telling buyers about the quality      or thirty different products and tell
                             the fair, the Lavco team were completely     they were offering. Quite wrongly, they      the market they´re good at everything.
                             depressed. The reason was that a leading     lacked confidence in their product.”         Europeans won´t even stop to talk with
                             German competitor was exhibiting right       Adds Vos, “They were sitting on a gold-      a firm like that; they know you can´t
                             across from them in the same hall and        mine but acting as if it was nothing.”       excel unless you specialise. As for quality,
                             attracting all the visitors. The Germans                                                  we believe that focussing on maximum
quality and taking the time you need         bumped into a representative of Cooper       by a Cooper representative confirms the
for that is far more lucrative in the long   Energy Systems, a big fish in America´s      Americans´ excitement about Lavco:
run than trying to get a quick share of      compressor market. “To my surprise, he       “Lavco is a true success for Cooper
the market with low prices. Low prices       told me they were having some problems       Compression. It is a very valuable sup-
always catch up with you in this indus-      with a Chinese liner manufacturer. So I      plier for us and we thank the CBI for
try.” Adds Henderieckx, “I´m convinced       said, ´I know a firm that can help – right   your help in finding them.”
any company that tries to get business       outside your back door, in Colombia´.        Not surprisingly, the emails coming in
                                             The American said, ´How big are they?´,      from Bucaramanga were even more
                                             but I answered, ´You shouldn´t be asking     positive: “You gave us the encourage-
                                             me how big they are, but how good they       ment we needed to believe we´re able
                                             are.´” Says Vos, “A firm like Cooper that    to do business with the most important
                                             uses a lot of its compressors in the chem-   companies in the world, because we
                                             ical industry would be particularly eager    are good. Until the CBI came along, we
                                             to have the best possible quality.”          knew we had a good product, but we
                                             Mildly interested, the Americans prom-       really did not believe that some big com-
                                             ised they´d send an inquiry.                 pany such as Cooper could be a target
                                                                                          for us. We know they are not a European
                                             Soon Henderieckx had an excited email        company but after all the CBI wants
                                             from Olga Rueda, saying Cooper had           enterprises from developing countries to
                                             indeed contacted them. He advised her        progress and achieve a better situation,
                                             to send details, including a normal price    and that’s it.”
                                             offer, and try to land an appointment.
                                             Within weeks, Olga emailed again, say-       Now Lavco is so busy producing liners
                                             ing somewhat despondently that her           for Cooper plants all over the world,
                                             price had been judged “30% too high”.        including Europe, that the Colombians
                                             Henderickx smiles: “This is the game.        have no capacity for other buyers. “Now
                                             We told Lavco not to budging an inch,        that they´ve proven their worth and
                                             because we knew their price calculations     established their core business success-
                                             were very accurate: the price they were      fully, they´re also making a lot of extra
                                             asking was realistic. They wanted to drop    money with revision and copying. The
                                             the price just to get an order, but fortu-   main challenge they face now is to con-
                                             nately they were cold-blooded enough to      trol the growth process and not get run
                                             stick to their guns.”                        over by their own success. But if they
                                                                                          keep cool like so far and work as hard as
                                             The best tip ever                            they have so far, they´ll be okay.”
                                             Within two months of the first contact,      Henderieckx and Vos are, of course,
                                             Cooper was ordering samples – for the        thrilled by the success of Lavco. Says




                                                                                                                                      CBI News Bulletin 2006
                                             full original price. In no time, Lavco       Henderieckx, “All over the world, there
                                             was selling liners at $100.000 a month.      are small companies like Lavco doing
                                             Henderieckx and Vos estimate the firm´s      an outstanding job and just waiting to
                                             capacity must have doubled and its           be discovered. The great thing about
                                             turnover risen to at least $1.5 million      the CBI is that we´re out there doing the
                                             in the year that followed. “Later I met      discovering.”
                                             the Americans again, and they said the
by producing quality rather than offer-      Lavco tip was the best one they´d ever       The CBI consultants Dick Vos (left)
ing low prices can compete anywhere          had. Of course, they´d never heard of        and Staff Hienderickx (photo: Stephen
in the world. But you do have to present     the CBI.” An email sent to Henderieckx       Teeuwen).
your quality with confidence, otherwise
                                                                                                                                      September/October Page 19



buyers won´t risk giving you a chance.
It takes a different attitude than sitting
around at a trade fair with an expression
on your face that says, ´Please don´t ask
me any difficult questions.´”

A big fish
Meanwhile, back in Bucaramanga
exports had failed to take off after
Hanover. But the CBI was not
through with Lavco. Having given the
Colombians some technical advice on
how to increase liner density with a cer-
tain alloy, Henderieckx and Vos went to
work in the business-to-business circuit.
During a trip to China, Henderieckx
                               The world-famous bridge in Mostar, Bosnia and Herzegovina,
                               has been a symbol of bridgecraft and cooperation between local
                               regions for ages.



                            The CBI joins forces with regional agencies                                             date is to act as a catalyst in identifying
                                                                                                                    new economic opportunities and to
                            in Bosnia and Herzegovina                                                               stimulate the nation´s economic devel-
                                                                                                                    opment. The five RDAs cover the entire
                                                                                                                    country, with ARDA operating in the


                            Building bridges                                                                        northwest region, NERDA in the north-
                                                                                                                    east, REZ-RDA in the central region,
                                                                                                                    SERDA in the Sarajevo macro-region and
CBI News




                                                                                                                    REDAH in the Herzegovina region. The

                            with Bosnia’s BSOs                                                                      FTC is an independent, non-governmen-
                                                                                                                    tal, non-political and non-profit public
                                                                                                                    association. Its mission is to develop
                                                                                                                    and upgrade foreign trade policies, cus-
                            The CBI has joined forces with five regional development agencies and
                                                                                                                    toms and tariff policies, international
CBI News Bulletin Page 20




                            the Foreign Trade Chamber in Bosnia and Herzegovina to launch a new
                            development programme for the country´s business support organisa-
                            tions (BSOs).

                            The BSO development programme is to         Stimulating growth
                            provide input to BSOs in three key areas:   The CBI´s programmes and services
                            export diversification; organisational      have been open to companies and
                            strengthening and institutional develop-    BSOs in the Federation of Bosnia and
                            ment; and export marketing and man-         Herzegovina since 2005. Contacts
                            agement. It was officially kicked off in    with the RDAs and the Foreign Trade
                            Zenica on June 15 with the signing of a     Chamber were established during the
                            memorandum of understanding between         the CBI´s first identification mission to
                            the seven participating institutes: five    the Balkan nation.
                            regional development agencies (RDAs),       The RDAs were created by the European
                            the Foreign Trade Chamber (FTC) and         Union and USAID/CHF and became
                            the CBI.                                    active from 2003 onwards. Their man-
finance, transport and communication
and to coordinate the reinvigoration
and reconstruction of the economy. It
serves approximately 15.000 members.
                                            Medica 2006 still
Three modules
The programme consists of three
modules:
                                            gaining popularity
• Export diversification – in this mod-     The world’s largest medical trade fair, Medica is alive and kicking. The
  ule about 15 export products with         2006 edition of the fair, from November 15 to 18, 2006, in Düsseldorf,
  maximum potential will be selected,
                                            Germany, is expected to draw at least as many exhibitors as it did last
  with the purpose of boosting the
  country´s annual export income by         year, or more. Among them will be 14 CBI-supported exporters from
  approximately € 750 million after a       India, Pakistan, South Africa, Colombia, Tunisia and Egypt.
  10-year gestation period.
• Organisational strengthening and          Altogether, organisers expect over 4,000        innovativeness.”
  institutional development – in this       firms to exhibit at Medica 2006, drawing        The CBI pavilion will present a product
  module the focus will be on analys-       around 140,000 visitors. Commenting             range including portable apneu monitors




                                                                                                                                                Promotional Events
  ing and strengthening the organisa-       on the rise in registrations from an            voor newly born babies, surgical instru-
  tional and institutional structure and    international spread of nations Wilhelm         ments, safety scalpels, wound care pro-
  the various work processes within in      Niedergöker, managing director of               ducts, orthotic and orthopaedic braces,
  the RDAs and FTC. Product manag-          Messe Düsseldorf, said, “We´re glad             operating tables and hospital furniture,
  ers will be trained in coordinating       that numerous European countries like           surgical gowns and drapes, syringes and
  and stimulating export-related activi-    Italy, Spain, Austria, Poland and the           needles, cardiac monitoring systems,
  ties for the business community in        Netherlands are now flying their flags          suction pumps, interventional gastro-
  Bosnia and Herzegovina.                   here even more prominently.”                    enterology products. A special display
• The export marketing and manage-                                                          centre will give visitors a preview of
  ment module will include the train-       The popularity of Medica is good news           products to be exhibited at Medica 2007:
  ing of local consultants as export        for the companies in the CBI ´s export          cardioplegia sets and extra corporeal cir-
  business consultants, skill training      developing programme for medical devi-          cuits, in vitro diagnostics, UVA and UVB
  for business groups, associations,        ces gearing up for Düsseldorf. “There           equipment for dermatology and cosme-
  other BSOs, RDA and FTC staff, and        will be a lot of attention for the growing      tic treatment, catheters, stimulation and
  commercial attachés and ambassa-          home care business, but also for newer          nerve mapping systems, bi-polar surgical
  dors.                                     technologies like nano-technology and           instruments, infusion and transfusion
                                            digitalised operating techniques. Across        sets, disinfectants, scrubs, plasters and
                                            the whole width of the sector, more and         other wound care products.
                                            more European buyers are looking for




                                                                                                                                         CBI News Bulletin 2006
                                            producers in developing countries for           Where to find the CBI
                                            contract manufacturing, original equip-         The CBI will be located in Hall 6, stand
                                            ment manufacturing and the like. What           number A54.
                                            distinguishes the CBI’s exporters from
                                            many others from low-cost regions is
The CBI’s managing director Ton Lansink     their high certification levels, high qua-      Crowds gathering at Medica, the worlds
(fourth from left) signs a memorandum of    lity, flexibility, cost-effective pricing and   leading trade fair in its sector.
understanding with the representatives of
five regional development agencies and
the Foreign Trade Chamber of Bosnia and
Herzegovina.
                                                                                                                                         September/October Page 21
                            Preparing for                                                                            Specialists
                                                                                                                     only at Valve
                            Midest 2006                                                                              World 2006
                                                                                                                     The CBI will be taking four of
                                                                                                                     the exporters participating in its
                            A select group of participants
                                                                                                                     export development programme
                            in the CBI programme for cast-
                                                                                                                     for pipes and process equipment
                            ings, forgings and subcontract-
                                                                                                                     to a highly specialised trade fair
                            ing are currently preparing to
                                                                                                                     in November, the Valve World
                            exhibit at the world’s leading
                                                                                                                     Conference & Expo 2006.
                            industrial subcontracting show,
                            Midest 2006. The event takes                                                             Valve World will take place from
                            place from November 7 to 10 in                                                           November 7 to 9, 2006, in the sout-
                                                                        The entrance of Midest, gateway to a world   hern Dutch city of Maastricht, near the
                            Paris, France.
                                                                        of knowledge and commercial power.           German and Belgian borders. Showcased
                                                                                                                     as a ‘must attend’ show for flow control
                                                                                                                     professionals, the event is expected to
                                                                                                                     be the largest-ever Valve World expo,
                                                                                                                     featuring 340 exhibitors active in the pro-
                                                                                                                     cess industries and an estimated 6,500
                                                                                                                     international visitors. The specialist
                            The annual Midest event is the largest                                                   nature of the fair suits the producers who
                            international gathering of subcontract-                                                  will exhibit in the CBI stand to a tee. RGR
                            ing technical expertise and services                                                     Technologies from South Africa, who will
                            for the processing of metals, plastics,                                                  be exhibiting ball valves, check valves
                            electronics and electricity. The fair       Robot-mechanica, one of the many sectors     and high-pressure valves, produces in
                            offers industry professionals solutions     in industrial subcontracting affairs.        small numbers, sometimes just ones and
                            that meet their requirements from                                                        twos. As the firm proudly announces on
                            the subcontracting of capacity to the       certified”, says Vos. The exporters are      its website: ´Big? No. Passionate? Yes.
                            complete industrialisation of products      also all equipped with CNC and/or            Flexible? Definitely!´ Gunric Valves, also
                            involving the latest technologies. The      conventional machining equipment             from South Africa, is specialised in but-
                            way the fair organisers put it, the event   and have modern testing equipment.           terfly valves. It boasts having been at
                            offers participants an opportunity to       Another advantage they offer is that         the forefront of triple eccentric butterfly
                            generate useful contacts, encourage         they can supply flexibly in medium or        valve design since 1989. Today, its high-
                            new exchanges, highlight their know-        small series of consistent quality.          quality valves are effectively used in the
                            how, serve their company, and create        Among the products they will be              water, oil, process, mining, power gene-
CBI News




                            events for their company.                   exhibiting are precision investment          ration, petrochemical, gas, sugar and
                            Says CBI consultant Dick Vos, “Many         castings in stainless steel and various      steel refinery industries worldwide.
                            European firms are looking for solu-        other materials, sand castings, bear-        Shreeraj Industries of India manufactu-
                            tions on lower-cost regions. However,       ings and CNC machining.                      res gate valves, globe valves, check valves
                            finding the right sources, with all                                                      and ball valves. Combining 35 years of
                            the traveling and auditing involved,        Where to find the CBI                        experience in the design, manufacture
CBI News Bulletin Page 22




                            is a time-consuming and expensive           The CBI will be located in Hall 6,           and supply of oil- and gasfield equip-
                            process. A visit to the CBI pavilion at     stand F-168.                                 ment with the flexibility of a small com-
                            Midest ought to provide those buy-                                                       pany, Shreeraj offers visitors “the perfect
                            ers with a shortcut, because the CBI                                                     alternative for upstream solutions”.
                            has done a lot of preparatory work for                                                   India´s Avcon Controls, finally, is a spe-
                            them.”                                                                                   cialist in solenoid valves, control valves,
                                                                                                                     ball valves, butterfly valves and pneuma-
                            The companies exhibiting in the CBI                                                      tic actuators. Its comprehensive range of
                            pavilion have all been audited and                                                       solenoid Valves, for instance, is widely
                            trained by CBI consultants in areas                                                      recognised as a quality range of econo-
                            such as production, testing and logis-                                                   mically priced products.
                            tics and are well aware of European
                            quality and other requirements.                                                          Where to find the CBI
                            “They’ve all invested in systems to                                                      The CBI will be located in Stand 1915
                            meet European requirements and are                                                       of the Maastricht Expo and Congress
                            ISO 9002, ISO 9001 and/or TS 16949                                                       Centre (MECC).
      Three CBI pavilions
      at Electronica 2006

                                                                                                                                      CBI News Bulletin 2006
The presentations of CBI-sup-                bitors are from India, Tunesia,             and EMS (design, engineering, boa-ed
ported exporters at Germany´s                South Africa and Thailand.                  assembly, assembly production, com-
                                                                                         ponent insertion, CAN, wire harness,
Electronica 2006 trade fair this
                                             The product range offered by these          ‘Electronic Hospital’ maintenance).
November will be spread out                  exporters covers four segments: embed-      In addition to quality and specialisation,
over three separate pavilions. In            ded technology (such as modules,            the exhibitors have been trained by the
this way, the CBI is adapting to             PCMCIA components, software; sensors,       CBI to offer customer-specific solutions,
                                             LEDs and LED-modules/assemblies,            to make small volumes available, and to
the fair´s product-oriented set-
                                                                                                                                      September/October Page 23



                                             security devices); passive components       demonstrate maximum flexibility in dea-
up, says consultant Guenther                 (film capacitors, plastic capacitors,       ling with buyers. “These are their strong
Fandrich.                                    aluminium electrolytic capacitors, sup-     points”, says Fandrich.
                                             pression capacitors, EMC modules and
Electronica 2006 is scheduled to take        components, EMC testing (certified          Where to find the CBI
place from November 14 to 17, 2006 in        lab), wire-wound resistors, wire-wound      The CBI will be located in Hall A6, Stand
Munich, Germany. It is “the absolute         potentiometers, precision potentiome-       A6.758 with four companies; Hall B4,
number one fair in the world for this        ters, digital and motorised potentiome-     Stand : B4.618 (seven companies and
field”, says expert Fandrich. The number     ters, capacitor-grade metallised film,      eight co-exhibitors who are members of
of companies participating with the CBI      coils, transformers ); electro-mechanic     the attending association); and Hall B5,
this year is twenty. Business support        products (switchgear and control gear,      stand B5.554 and B5-560 (eleven compa-
organisation (BSO) Elcina from India         solid state relays, phase monitor relays,   nies and six co-exhibitors).
plans to attend, along with twelve of its    I/O-modules, PCB hardware, PLCC,
member companies, as do two Tunisian         PGA, IC sockets/adaptors/FootPrint
companies and Aramis Sourcing, a BSO         Converters, PCB test Point/Jacks, EMI/
that is also from Tunisia. The other exhi-   RFI shieldings, fuses, motors and gears;
                                                                                                                                Assembling safety scalpels.


                                                                                                                                turers of medical devices to concentrate
                                                                                                                                on their strong points in order to get a
                                                                                                                                competitive edge. Some of the compa-
                                                                                                                                nies in Pakistan have already begun to
                                                                                                                                follow this advice and one of them will
                                                                                                                                be presenting its products in the CBI
                                                                                                                                pavilion at the Medica 2006 trade fair
                                                                                                                                later this year.” Another key piece of
                                                                                                                                advice the CBI gives medical compa-
                                                                                                                                nies has to do with setting high quality
                                                                                                                                standards. “Even for non-exclusive Class
                                                                                                                                I products this is an issue we give a lot of
                                                                                                                                attention to”, says Santema.

                                                                                                                                More than cheap labour
                                                                                                                                Excitingly, the consultants have again
                                                                                                                                encountered companies with very spe-
                                                                                                                                cial products. One example is a company
Technical Assistance/Company visits




                                                                                                                                that produces a mini portable apnoea
                                                                                                                                monitor that is in direct contact with the
                                                                                                                                baby and does not involve any wiring.
                                                                                                                                Another nice surprise is a company that
                                                                                                                                has taken surgeon safety as a business
                                                                                                                                opportunity and has produced a new
                                                                                                                                type of drapes and clothes (HIV and
                                                                                                                                MCD) to protect surgeons from infected
                                                                                                                                blood as well as safety scalpels that sig-
                                                                                                                                nificantly reduce the number of cutting
                                      The CBI has launched a new export development programme for medi-                         accidents. In addition to these, the CBI
                                                                                                                                group will be catering to the EU market
                                      cal devices and laboratory equipment with which it plans to introduce
                                                                                                                                with many other high-tech products in
                                      a completely new assortment of medical products to the European                           the next few years, such as complete
                                      Union market. The 40 participating exporters are a promising bunch,                       extracorporeal hart circuits, UVA and
                                      but they face some hard work before they’ll be ready to conquer the EU.                   UVB equipment, software development
                                                                                                                                for cardiology. Says Santema, “Exporters
                                      In keeping with its progressive ambitions, the CBI plans to enhance its
                                                                                                                                from developing countries today offer
                                      Medica 2006 presentation with a running video on the new participants                     a lot more than just cheap labour and
                                      and their products. The previous medical programme (see textbox)                          low production costs. They also present
                                      ends next year.                                                                           an opportunity for EU manufacturers
                                                                                                                                and distributors to tap into high quality
CBI News




                                                                                                                                standards and high levels of production
                                      A promising bunch of exporters enters the new CBI                                         continuity.”

                                      programme for the medical sector                                                          Hard work ahead
                                                                                                                                Most of the participants in the new
                                                                                                                                programme do have a lot of hard work

                                      Tough operation
CBI News Bulletin Page 24




                                                                                                                                ahead as they prepare to meet the
                                                                                                                                requirements of EU distributors. The
                                                                                                                                main areas of attention are: certification,
                                                                                                                                quality continuity, continuity in produc-

                                      ahead                                                                                     tion and supplies, and making products
                                                                                                                                that fully meet the requirements of
                                                                                                                                end users. Sometimes this means find-
                                      In the first phase of the new programme,      and product improvements, packaging         ing alternative materials. For instance,
                                      consultants Arjan Hock and Leendert           & labelling, marketing, implementation      latex is no longer used in Europe in any
                                      Santema visited participating companies       of EU requirements, identifying future      products that are in (direct or indirect)
                                      in Jordan, Egypt, Tunisia, India, Pakistan,   distributors, appointing an authorised      contact with patients, such as infusion
                                      South Africa and Colombia to discuss          representative.                             systems. Catgut as a suture material is
                                      initial improvement measures with             “In the countries we’re dealing with        not used anymore either and has been
                                      each company. They helped companies           competition is becoming severe in many      replaced by other absorbent materials
                                      obtain certificates and gave advice on a      cases”, says Santema. “This adds a lot of   like poly glycol acid. Also, distributors
                                      wide range of topics: production process      urgency to the advice we give manufac-      won’t be interested in a new product
                                              Previous EDP
                                              shows outstanding
Quality control: every instrument is
inspected visually and by means of digital
callipers.
                                              results
                                              While participants in the new export development programme
unless it is supplied with a medical
                                              for medical devices and laboratory equipment get warmed up for
back-up on its uses, case reports, a clear
description of medical application et         European market entry, the previous programme for this sec-
cetera. “Manufacturers from developing        tor will come to an end in 2007. The results for the participating
countries that can meet these require-        exporters have been outstanding.
ments have a big advantage”, says
Santema. Another benefit buyers are
looking for is inside information on alter-   All companies participating in this programme have by now obtained the ISO
native markets.                               certification and CE marking required by the EU and all of them have appointed
While grappling with these issues, par-       an authorised representative as well (see below). The choice of export products
ticipants will also have to develop a mar-    suggested by the CBI consultants proved successful. All participants did well at
ket entry strategy, including a marketing     the Medica 2003, 2004 and 2005 trade fairs – some very well. Ameco from Egypt
export plan. Some of them will have to        and Susruta from India, exporting intravenous multi lumen catheters and oph-
change their production flow, but most        thalmologic micro-instruments respectively, were extremely succesful. All other
of them will be ready within about one        participants met the targets for both certification and turnover.
year to start accessing the EU by attend-
ing Medica 2007. A few will be participat-    For the first time, the CBI offered medical programme participants an opportu-
ing in Medica 2006, along with partici-       nity to participate in international conferences, like that of the European Society
pants from the previous programme.            for Cataract and Refractive Surgery (ESCRS) held in Paris in 2004 and Lisbon in
                                              2005. These events provided excellent business opportunities to the specialised
                                              companies that attended them under the CBI umbrella.

                                              Certification matters




                                                                                                                                        CBI News Bulletin 2006
                                              In the medical business certification is a do-or-die issue. Exporters of medi-
                                              cal devices and laboratory equipment to the European Union must qualify for
                                              CE and ISO 9001/ ISO 13485. ISO 13485 has to do with the quality system of a
                                              company. The CE mark is a European conformity mark affixed on products that
                                              comply with the relevant EU directives. For medical devices, different classifica-
                                              tions apply: Class I is for non-sterile products with very low risk; Class II for ster-
                                              ile, non-invasive products with low risk; Class IIa and IIb items are usually inva-
                                              sive with a medium risk; Class III covers devices applied in direct relation with
                                              the heart, vascular system and the central nervous system. Exporters of Class I
                                              non-steriles with very low risk can compose their own declaration of conform-
                                              ity, but all other classifications require the intervention of a notified body. All
                                                                                                                                        September/October Page 25



                                              non-EU manufacturers must appoint a legal authorised representative.

                                              This body is or must be independent and registered in the EU and is to take care
                                              of the registration of products. Authorised representatives have to keep the tech-
                                              nical files of the product in their possession and in case of a problem or accident
                                              with the product, they are to take the necessary steps to inform the authorities,
                                              to make sure corrective actions are carried out by the manufacturer and to cover
                                              all other legal aspects.
                            A star actor in the CBI’s new promising                                                       surprisingly, says Van der Sman. “India
                                                                                                                          has managed to develop its pipes and
                            programme                                                                                     process equipment industry very well
                                                                                                                          and most of India’s companies are close
                                                                                                                          to complying with European demands

                            Pipes and process                                                                             in terms of product appearance, legal
                                                                                                                          requirements and CE marking as well as
                                                                                                                          business attitudes. Our observations at


                            equipment:                                                                                    the last exhibitions confirm that India is
                                                                                                                          now considered to be a fair alternative.
                                                                                                                          It looks as though the hesitation we used


                            India rising
                                                                                                                          to find among European buyers with
                                                                                                                          regard to doing business with India has
                                                                                                                          disappeared. India is now regarded as a
                                                                                                                          serious alternative for China and the East
                            In the CBI’s current export devel-            one or some of these with a delegation          European countries.”
                            opment programme for pipes and                of exporters in the coming years. A small
                                                                          group of CBI-supported companies                Local consultants
                            process equipment India is the
                                                                          will exhibit at Aquatech Amsterdam              The job of finding promising export
                            leading actor, thanks partly to the           and ValveWorld Maastricht, speciali-            companies in other developing coun-
                            input given by CBI-trained local              sed fairs to be held this autumn in the         tries, like Colombia, South Africa, Egypt,
                            consultants. The programme has                Netherlands.                                    Indonesia or the Philippines, is proving
                                                                                                                          tougher than expected. The reasons
                            been underway for almost a year
                                                                          A wide range of companies                       are diverse. One reason is the nature of
                            now and lasts until 2012. There is            “We’re happy with the present mix of            this engineering-related programme,
                            still room for more participants.             participants”, says consultant Peter van        says Van der Sman. “You need to have
                            The programme focuses on prod-                der Sman. The companies range from              a complete understanding of the scope
                                                                          tube and pipe manufacturers to tube             of a company’s activities before you
                            ucts like tubes, pipes, fittings,
                                                                          transformers and producers of special           can assess their suitability. In India we
                            valves, pumps and fabricated proc-            tubes, flanges and fittings. A few valve        have the advantage of having previously
                            ess equipment.                                and pump manufacturers have entered             appointed several local, CBI-trained con-
                                                                          the programme with products for simple          sultants for identifying likely exporters.
                            The previous programme for this sector,       water applications but also for critical        Our team of Indian consultants is func-
                            which started in 2000, was a huge suc-        chemical use. In the process equip-             tioning very well and they’ve formed a
                            cess. More than 40 companies actively         ment segment we have qualified heat             strong local network. These consultants
                            took advantage of the CBI’s support and       exchanger and large process equipment           are now actively involved in coaching the
                            continue to use CBI tools on their own        manufacturers participating with us.            participants in the programme.”
                            initiative. The new participants had their    “We’ll certainly attract many buyers with
                            first taste of the European market at this    this broad assortment of products and           Massaging the Europeans
                            year’s TUBE and Achema exhibitions in         systems”, says Van der Sman.                    In the pipes and process equipment
                            Germany, which were highly successful.                                                        business, promoting companies with
                            The CBI is now selecting other more           India moves forward                             standardised, finished products – like
CBI News




                            specialised exhibitions for the oil and       India is the most highly represented            valves or pumps – the route is not so
                            gas industry in order to possibly attend      country in the new programme. And not           difficult. Promotion becomes more of

                            India has managed to develop its pipes and process equipment industry very well and most of India’s companies now offer a fair and very
                            competitive alternative.
CBI News Bulletin Page 26
a challenge if the product is a type of
process equipment that has to meet very



                                              Expro seminar
specific requirements. In those cases,
European buyers are a lot more reserved,
notes Van der Sman. “They don’t want
to take too many risks.” This is where the



                                              coming up
CBI comes in. Van der Sman: “We can
help massage the buyer as well as equip
the exporter. In India we have a very
close co-operation with the Process Plant
and Machinery Association of India,           The next big event in the CBI’s export development programme
the PPMAI, and we are promoting them
                                              for pipes and process equipment is the Expro seminar in February
extensively on the European market,
so as to enable them to increase their        2007. Consultant Peter van der Sman will be spending the time
weight locally.”                              until then auditing the participating companies. All the companies
                                              that qualify will be invited to Rotterdam for the eleven-day Expro
Market research
                                              seminar, in which they will learn most of what there is to know
Almost all of the participants in the
current programme are ISO9000-certi-
                                              about business in the EU.
fied and have adapted to the Pressure
Equipment Directive, a precursor of CE-       Throughout 2007 Van der Sman will then be occupied with follow-up visits, or
marking. More importantly, they now           technical assistance missions, to the participating companies. “The participants
must adapt to the European acceptance         will need further assistance in preparing themselves for actual entry between
level and take the matters of market          2008 and 2010”, he explains.
research and export planning seriously.
The practical instruments and tools           A lot of major trade shows will be taking place in the period designated by
that the CBI offers them in this task are     the CBI for market entry, such as the Tube exhibition which is scheduled for
usually well-received. Van der Sman:          2008, 2010 and 2012 and is the world’s most important business forum for this
“Many participating companies have            industry. The Achema exhibition in Frankfurt is another classic, being the most
hired dedicated staff for their exports,      important trade fair for chemical engineering, environmental protection and
which means communication with the            biotechnology. The next edition of this exhibition is in 2009 and the CBI group is
consultants and the market has become         likely to also participate in the 2012 and perhaps even the 2015 exhibitions.
easier. We have to keep addressing the        In addition to these major exhibitions the CBI is also looking at smaller, more
management of the companies in strate-        local or specialised exhibitions for promoting its services and its exporters.
gic matters though.”
                                              The CBI’s export development programme for pipes and process equipment
The CBI is happy with the blend of            is still open to new applicants. For more information on the programme or to




                                                                                                                                   CBI News Bulletin 2006
product groups within the programme,          apply for entry, go to www.cbi.nl, click on ‘European Markets’ and ‘Pipes and
especially the specialisations. Says Van      process equipment’.
der Sman: “Market entry options for
specialised exporters are not always easy
to find, so this adds an extra challenge to
our job. It’s a good incentive.”

                                                                                                                                   September/October Page 27
                            Despite production shifts to low cost
                            countries, Europe remains a billion
                            Euro import market for electronic
                            components and subsystems abuzz
                            with interesting opportunities – par-
                            ticularly for manufacturers from
                            developing countries, says consultant
                            Guenther Fandrich, reporting on the
                            CBI´s successful export development
                            programme for this sector.



                            Fierce global competition is pushing European SMEs                                       for this change, many do not know how
                                                                                                                     to handle the return of products at the
                            abroad in search of partners                                                             end of their life cycles, which is what the
                                                                                                                     WEEE directive is about. This directive


                            Electronic markets
                                                                                                                     was established in order to combat the
                                                                                                                     fast–growing amount of waste from
                                                                                                                     electrical and electronic products and to
                                                                                                                     minimise the environmental effects cau-

                            are calling for you                                                                      sed by this waste stream.
                                                                                                                     “While RoHS has been seen largely as
                                                                                                                     an European demand in the past, export
                            In the face of the fierce global competi-    and two business support organisations      companies are realising now that these
                            tion, European SMEs in the electronic        from India and Tunisia with some addi-      requirements will become compuls-
                            industry are looking for strategic allian-   tional member companies will be gathe-      ory on their home markets in the very
                            ces, sales and outsourcing partners in       ring in three CBI pavilions this year to    near future as well”, says Fandrich.
                            developing countries. For an increasing      get even closer than they already were to   “Meanwhile, market-driven require-
                            number of them, the CBI is providing         their increasingly product-oriented cus-    ments laid down by some Japanese
                            the answer. In its export development        tomer audience. Says Fandrich, “After all   customers are even stiffer than the EU
                            programme for electronic components          the training and assistance we´ve been      ones.”
                            in systems alone, the CBI is currently       able to give them in getting compulsory
                            supporting around 60 export-hungry           and market-driven approvals, finding        China changing
CBI News




                            companies.                                   European marketing or strategic alliance    As for Chinese competition, in the past
                                                                         partners, we´ll proud to release these      China typically offered very low prices,
                            The programme will be drawing to a           competent developing country manufac-       but poor and often inconsistent quality.
                            close with a major event in November:        turers to their European peers at the end   But times have changed in China, too:
                            the last CBI co-sponsored journey to         of the programme.”                          today, China still delivers low prices,
                            Electronica 2006 in Munich, Germany.                                                     but the quality is very good to excellent
CBI News Bulletin Page 28




                            Twenty programme participants from           Three top issues                            for all commodity components. Says
                            India, South Africa, Thailand, Tunisia       For nearly all participating companies      Fandrich, “Many importers and even
                                                                         three topics have topped the priority       European manufacturers have conside-
                                                                         chart during the past twelve months:        red this as a real threat. Some producers
                                                                         RoHS, WEEE and Chinese competition.         have even given up exporting to Europe
                                                                         The first two are EU directives that        and other parts of the world completely
                                                                         became effective as of July 1, 2006. The    – at least for the time being.”
                                                                         RoHS directive places restrictions on       To get away from this price pressure
                                                                         marketing electrical and electronic equi-   several companies are shifting their pro-
                                                                         pment that contains certain hazardous       duct portfolio, moving into new products
                                                                         substances: lead, mercury, cadmium,         or moving into more customized added-
                                                                         hexavalent chromium, polybrominated         value solutions.
                                                                         biphenyls (PBB) and polybrominated
                                                                         diphenyl ethers (PBDE) in the EU. While     India and South Africa
                                                                         all companies active in Europe have         What about India? The booming Indian
                                                                         been preparing themselves quite well        electronic market with growth rates any
where between thirty to fifty percent        recently signed up a major order with       stand in 2006 as well. “Their stands were
has temporarily reduced many Indians´        an American company. This order will        visible proof that the CBI´s aim ´to assist
export interest. “Increased business         nearly double the turnover of the Indian    and train participants to become self-
on the home market has exceeded the          manufacturer in the next year – and         active and sustainable on the European
growth capacity of some of our parti-        the destination for all the products is     market´ really works”, comments
cipants, leaving no additional manu-         Europe.”                                    Fandrich.
facturing capacity for export”, explains
Fandrich. South Africa´s participants,       Proof of success                            Specialised events
whose firms are characterised by high        This year´s Hanover Industrial Fair was     All 2006 exhibitors want to return to
technical competence and correspon-          an interesting venue for participants       the 2007 exhibition – if possible under
ding products, are making inroads            aiming at the industrial and investment     the CBI umbrella again. Says Fandrich,
domestically as well as on international     sector. 2005 was the first year in which    “Electronica for sure remains the num-
markets.                                     the CBI went to Hanover with the elec-      ber one global fair for components and
                                             tronic components and systems group.        assemblies in electronics, but various
More globalisation                           Six companies with products and ser-        sector- and/or product-specific interna-
The globalisation of the electronic indu-    vices suited to this exhibition attended    tional exhibitions and conferences are
stry is not only continuing, it is spee-     in 2005 and seven in 2006. Participant      clearly gaining ground. We are seriously
ding up and the markets are becoming         Conzerv Systems has been going for          considering future attendance of some of
more and more blurry, says Fandrich.         several years on its own now, and India´s   these with our participants.”
“Consider this: an Indian participant just   Teknic Electromeconics had its own




   Destination West Africa




                                                                                                                                       CBI News Bulletin 2006


                                                                                         The local markets in Mali never fail to
                                                                                                                                       September/October Page 29



                                                                                         fascinate tourists from Europe.



A clever regional tourism package is putting Benin, Burkina
Faso, Ghana, Mali and Senegal on the map

Competition in international tourism         zero. However, combining neigh-             The CBI pavilion in the Netherlands
                                                                                         tourism fair Vakantiebeurs 2006 early
is severe. European consumers can            bouring destinations and putting
                                                                                         this year also included a joint presen-
choose to spend a holiday in any of          promotion in a regional framework           tation of several lesser known West
more than 180 countries. For coun-           can give them a new hold on the             African destinations: Benin, Burkina
tries with a weak infrastructure or          market, as a group of West African          Faso, Ghana, Mali and Senegal. The
                                                                                         joint effort, part of the CBI´s tourism
disadvantages, such as a language            entrepreneurs enrolled in the CBI´s
                                                                                         programme, was based on a new CBI
barrier or a negative image, this            export development programme for            initiative in close co-operation with the
cuts back opportunities to almost            tourism are finding out.                    World Tourism Organisation (UNWTO).
                            The large West Africa pavilion turned out    ticipants per workshop had to be limited      in a row before he can begin to establish
                            to be a surprise for many visitors to the    to 60, where normally 30 is already a         real business results. So our West African
                            fair, says consultant Willem Reijnders.      large group. They all valued the practical    friends still have two times to go. But
                            “The travel trade and especially the con-    approach of the CBI programme and its         half of the participants are already in
                            sumers were astonished by the tourism        focus on systematic and planned activi-       serious business discussions with the
                            opportunities offered in the pavilion.       ties.                                         travel trade. Very encouragingly, a hand-
                            Many of them had never seen these des-                                                     ful of Dutch tour operators are already
                            tinations in the attractive regional con-    Tour operators                                considering including our destinations
                            text we presented them in.”                  Participating in European tourism fairs is    in multiple destination packages by 2007
                                                                         complicated and expensive – even with         or 2008, assuming the political situation
                            Pilot project                                the substantial help offered by the local     remains stable.”
                            The West African project started back in     Royal Netherlands embassies and the
                            2004 with discussions between the CBI        assistance of CBI. So succeeding in pre-      The 2007 tourism fair
                            and the UNWTO. Later, when Ghana             senting a West African pavilion with 18       The next Dutch tourism fair is sched-
                            joined the CBI tourism programme,            companies and organisations in the CBI        uled for January 2007 and programme
                            the West African connection became a         stand last January was quite an accom-        participants will soon be sending out
                            promising pilot project for regional tour-   plishment.                                    invitations to prospective clients. But
                            ism. In the mean time, the CBI entered       During the fair it became clear that the      even before they´ve started, many have
                            into discussions with the tourism min-       participants had used the training to         already been receiving signs of keen
                            isters and national tourist boards of        their advantage, Reijnders observes.          interest from the field. No doubt the CBI
                            the various countries in the region. “It     “Most came well prepared, with good           pavilion, with its customary perform-
                            turned out there was a growing interest      material and sometimes they had already       ances of traditional music and dances,
                            in combining destinations and setting up     taken care of the pre-fair marketing and      will once again be a focal point for many
                            a joint presentation”, recalls Reijnders.    prepared contacts in advance. They            fair visitors.
                            Based on this interest, the CBI arranged     attracted a lot of attention from the trade
                            training sessions in reaching new mar-       and from consumers and they valued the
                            kets and effective fair participation.       concept of combined destinations in this
                            Workshops were held in Bamako, Mali;         region.”
                            Cotonou, Benin; and Ouagadougou,             Post-fair evaluation thus far has shown
                            Burkina Faso. Both the public and pri-       promising results. Reijnders: “On an
                            vate sectors in these countries were         average an entrepreneur has to count          Virgin-like Benin beaches on the verge of
                            eager to participate: the number of par-     on attending a tourism fair three times       discovery…
CBI News
CBI News Bulletin Page 30
                                                                                    Medical devices and laboratory equip-
                                                                                    ment for rent or lease, in connection
                                                                                    with the commercialisation of Europe’s
                                                                                    health care these are becoming a growth
                                                                                    sector for exporters.


                                                                                    support organisations active in the medi-
                                                                                    cal devices and laboratory equipment
                                                                                    sector were invited. The group repre-
                                                                                    sented Colombia, Egypt, India, Jordan,
                                                                                    Pakistan, South Africa and Tunisia. Some
                                                                                    were newcomers in the CBI´s export
                                                                                    development programme for this sector.
                                                                                    The next step for a number of the Expro
                                                                                    attendants is to exhibit at the interna-
                                                                                    tionally renowned Medica 2006 trade fair
                                                                                    later this year in Germany.

                                                                                    The medical market
                                                                                    The medical industry in Europe consists
                                                                                    of four main segments, CBI consultant
                                                                                    Leendert Santema explained to the Expro
                                                                                    participants in one of his lectures. The
                                                                                    first is the intramural segment, which
                                                                                    includes academic and general hospitals
                                                                                    and a wide variety of specialised and
                                                                                    private clinics, from dental and eye to
                                                                                    cosmetic clinics. Next is the extramural
                                                                                    segment: nursing homes, care centres,
                                                                                    home care (not to be confused with the
                                                                                    emerging care-at-home trend), and pri-
                                                                                    vate one-day-stay clinics. Of the remain-

In the rapidly changing medical industry                                            ing two segments, the institutional
                                                                                    market and the senior citizen market, the
adaptability is key, Expro participants discover                                    latter is particularly interesting, Santema
                                                                                    says, because it is an expression of one



Export
                                                                                    of the main current market trends. “The




                                                                                                                                  CBI News Bulletin 2006
                                                                                    ageing of Europe´s population presents
                                                                                    immense opportunities to the medical
                                                                                    supplies sector”, he says. “Governments



chameleons
                                                                                    are eager to provide the kind of medi-
                                                                                    cal and care environment that allows
                                                                                    elderly people maximum independency
                                                                                    in their own homes. One result is that
                                                                                    demand for all kinds of devices that can
By Stephen D. Teeuwen
                                                                                    aid the elderly is up, like wheeled walk-
The medical industry is changing so rapidly that change is near enough              ers, specials chairs, high beds and many
                                                                                    other products. For manufacturers in
the only constant factor, consultant Nick Meijer told participants in the
                                                                                                                                  September/October Page 31



                                                                                    developing countries, these are interest-
CBI´s Expro 56 seminar for exporters of medical devices and labora-                 ing opportunities.” Other market trends
tory equipment in August. To keep in step with opportunity, you have                Santema told exporters to look out for
to be “like a chameleon”, he said. “The capacity to adapt should be a               include the growing role of rental organi-
                                                                                    sations for medical equipment, lease
core competency of any company. Organisations that anticipate changes
                                                                                    constructions for capital equipment and
faster than their competitors have more time to adapt to the market and             the commercialisation of hospitals. In
therefore a greater chance of survival.”                                            England, for instance, pharmacy giant
                                                                                    Boots is buying hospitals and bringing
The Expro seminars are a recurring       entry. One of the core objectives of the   general practitioners into its shops.
item on the CBI agenda. Combining        seminar is to help participants prepare,
in-depth lectures on many aspects of     formulate and effectively implement        Chemistry meets marketing
export marketing and management with     an export marketing plan. For the 56th     All this of course confirms the CBI phi-
first-hand encounters in the European    edition, which took place from August      losophy that export success depends as
business world, the seminar is a solid   21 to 29 in Rotterdam, the Netherlands,    much on commercial and marketing
stepping stone towards European market   forty-one exporters and two business       savvy as it does on technical – in this
                                                                          are very, very competitive. Also, we´re
                                                                          flexible in terms of volumes and package
                                                                          sizes. When I go back I will again stress
                                                                          the importance of consistent quality
                                                                          and also of transparency and ethical
                                                                          behaviour. If we stay on track with those
                                                                          issues and put enough effort into serious
                                                                          marketing, I don´t see why we wouldn’t
                                                                          succeed.”

                                                                          Facing the budget crunch
                                                                          Said and the other participants did not
                                                                          just get the full story on market opportu-
                                                                          nities during Expro 56. A substantial part
                            Anna Christina Gomez from Colombia, well      of the lectures was devoted to the threats    Mohammed Said from Egypt, attending
                            experienced in strong competition, “target-   they face. For exporters from developing      his first marketing seminar, “a real eye-
                            ing Europe now”.                              countries these include over-depend-          opener”.
                                                                          ency on a temporary contract or a single
                            case medical – know-how. For partici-         buyer or market segment, competi-             in this way. And the cost of a suitable
                            pant Mohammed Said from Egypt that            tion from other low-cost countries, the       catheter is no more than about twenty-
                            was one reason for signing up for Expro       spreading control of insurance compa-         five euros.” Obviously, low prices are
                            56. “To me much of the seminar mate-          nies, logistical problems, tightening envi-   not everything. Says Meijer, “You always
                            rial is more or less new”, he said towards    ronmental regulations and tariff barriers.    have to remember that the medical busi-
                            the end of the seven-day drill. “I have a     And then there´s the budget crunch. “As       ness deals with life and death situations.
                            PhD in biochemistry, so all my energies       an exporter, you must prepare yourself        Buyers are cautious, especially with new
                            thus far in my career have been devoted       to confront the issue of budget reduc-        players on the market, because of the
                            to biochemistry. This is the first time I´m   tion”, marketing consultant Nick Meijer       responsibility they have.”
                            attending a marketing seminar.”               told the participants. With the price of
                            Said is the executive director of Vitro       hospital beds going up and government         Nothing to everything
                            Scient, a Cairo-based firm hoping to          healthcare budgets under pressure, the        The soaring prices of hospital beds in
                            market its in vitro diagnostic kits for       sector as a whole is alert to sharp deals.    Europe these days were a big surprise to



                               You have to be able to prove that with your product the hospital will
                               achieve an interesting cost reduction

                            labs on the European market. The com-         Exporters who can offer those have            Egypt´s Mohammed Said. “It was a real
                            pany fits the CBI profile, as it produces     a major competitive advantage. Said           eye-opener to me. But it also opened my
                            products of consistent quality and vol-       Meijer, “You have to be able to prove         mind to a lot of opportunities. If hospital
                            umes for a good price and has a good          that with your product the hospital will      beds are so expensive, I can understand
CBI News




                            position on the domestic and regional         achieve an interesting cost reduction,        that the European market is interested
                            markets. Virtually all it needs to become     for instance because a patient will have      in things like home care solutions, like
                            a successful exporter to Europe is a few      to spend less time in a very expensive        mobility enhancers for the elderly. It
                            healthy doses of marketing input. Says        intensive care unit. In the Netherlands,      makes sense. Our company doesn´t pro-
                            Said, “Working on the marketing side of       one day less in the IC unit means a cost      duce anything in that range, but it´s still
                            our business is the only way to penetrate     reduction of three thousand euros.”           a good example of how we must learn to
CBI News Bulletin Page 32




                            new markets; I may be a biochemist, but       The consultants gave a practical exam-        think outside the box.”
                            at least I know that much. You have to go     ple. “Sometimes a simple measure can
                            for it, even if you don´t like it.” He then   help prevent a ventilated patient from        Back inside the box, meanwhile, success-
                            adds with a grin, “But I like it! Marketing   getting nosocomial infections, or infec-      ful export is also about simply putting
                            is a fascinating science.”                    tions that typically occur in a hospital.     your nose to the grindstone. Getting
                            Apart from learning the tricks of mar-        By taking a sputum sample from the            your CE and ISO certification sorted
                            keting and familiarising himself with         patient´s lower airway with a protected       out, finding and officially appointing an
                            European business culture, Said says          telescopic catheter, one is able to detect    authorized representative in Europe,
                            the most helpful seminar modules were         immediately if there is a source of           putting together a clear, attractive com-
                            those on EU import regulations (“It´s a       inflammation. If this is done in a very       pany presentation, researching potential
                            hell of a job to understand those”) and       early stage, the patient can be discon-       markets, streamlining logistics, making
                            CE marking. He was set to return home         nected from the ventilator earlier and        sure your labelling and packaging meet
                            full of optimism. “I don´t see any obsta-     can probably leave the IC unit                European standards, sifting through all
                            cles to our exporting to Europe. We can       one or two days sooner than would have        the relevant legislation, meeting social
                            easily compete with European manufac-         been possible otherwise. Also, the mor-       and environmental standards, covering
                            turers in terms of quality and our prices     tality rate can be reduced significantly      your liability, securing your intellectual
property rights – the list would be
enough to kill anybody´s export ambi-
tions in no time, it seems. Which is why        Trade Fairs
the CBI is careful about which entre-
preneurs it selects for programmes              and
like the medical one. Says Meijer, “The
levels of experience and export-readi-
ness among the Exro participants can
                                                Conferences
vary a lot, but what they all have in
common is the right mentality. It is one
of the main selection criteria the CBI
applies. To make it in this business, you
have to be flexible, resilient, inventive,
persevering. Otherwise, you´ll fail or       INDIA                                       Digital: Computer, Electronics, IT,
just quit.”                                                                              Satellite & Telecom products & machin-
                                             23rd India Knit Fair                        ery - Kenya Expo
Broad range of topics                        Tirupur                                     Nairobi
Anna Cristina Gomez, international           October 11 -13                              October 18 - 21
marketing manager for Colombia´s             www.indiaknitfair.com                       www.kenyaexpo.com
Adhesivos Internationales, is among          indiaknitfair@gmail.com                     info@kenyaexpo.com
those who intend to make it. Adhesivos
Internationales specialises in wound         Indian Handicrafts & Gifts Fair (Autumn)    Fashion: Garments, Textiles, Cosmetics,
care products: bandages, first aid           2006                                        Fashion Accessories products & machin-
materials, plasters, surgical tapes and      New Delhi                                   ery - Kenya Expo
the like. “We already export all over        October 13 -17                              Nairobi
the Americas, seventy percent in Latin       www.epch.com                                October 18 - 21
America and thirty percent to North          trade@epch.com                              www.kenyaexpo.com
America and Canada”, says Gomez.                                                         info@kenyaexpo.com
“We´re market leader in thirteen coun-       EU Karnataka IT Asia Enterprise 2006
tries, despite competition from multi-       Bangalore                                   Food: Beverage & Packaging products &
nationals. So we have a lot of experi-       October 30 -31                              machinery - Kenya Expo
ence in handling strong competition.         www.euindiachambers.com                     Nairobi
Accessing a new market is not new to         info@euindiachambers.com                    October 18 - 21
us, but what´s new is that we´re target-                                                 www.kenyaexpo.com
ing Europe now. And here in Europe           Asia-Pacific Aluminium Conference 2006      info@kenyaexpo.com
competition is much tougher than in          – International Exhibition Kala Academy
Latin America, because exporters from        Panaji, Goa                                 Medipharma: Medical, Healthcare &




                                                                                                                                   CBI News Bulletin 2006
the whole world come here.                   November 2 – 5                              Pharmaceutical products & machinery
                                             www.alucastindia2006.com                    - Kenya Expo
It will be tough for us. But because         alucast2006@yahoo.co.in                     Nairobi
we have a large product portfolio,                                                       October 18 – 21
good quality and competitive prices,         Global Sourcing - Rotary Export Fair        www.kenyaexpo.com
we believe Europe is accessible to us.       2006 - Nehru Center                         info@kenyaexpo.com
The Expro seminar has been a good            Mumbai
help in seeing the way forward. What         December 12 – 15
has impressed me most is the com-            www.ref2006.org
pleteness of the seminar. I´ve been in       rksck@iqara.net; acsc@iqara.net
international business for five or six
                                                                                                                                   September/October Page 33



years now and on different markets,
but the Expro seminar gives you a very       KENYA
deep understanding of a lot of different
aspects, from marketing techniques,          Automotive: Auto & Spare Parts prod-
to regulations, to e-business – almost       ucts & machinery - Kenya Expo
everything.”                                 Nairobi
To Nick Meijer, effectively combining        October 18 - 21
breadth and depth in the seminar´s           www.kenyaexpo.com
content is always a challenge. “To be        info@kenyaexpo.com
complete in seven days is hardly pos-
sible. But if we we can motivate and         Building: Construction, Security & Safety
equip participants to go off and find        products & machinery - Kenya Expo
their own way to further development         Nairobi
on the market, I suppose we have rea-        October 18 - 21
son to be satisfied.”                        www.kenyaexpo.com
                                             info@kenyaexpo.com
                                                                                      Ongoing and
                                                                                      Planned
                                                                                      CBI activities
                            What                                 When                Where                Details
                            BSOD Vietnam                         September           Vietnam              Institutional development

                            Trade delegation fruits and          September 12        The Netherlands      Presentation on CBI programmes
                            vegetables from South Africa                                                  and services

                            Trade delegation garments            September 23        The Netherlands      Presentation on CBI programmes
                            from India                                                                    and services

                            Exporters Bid Challenge              September 27        The Netherlands      Presentation on CBI programmes
                                                                                                          and services

                            Expro 58                             September 11 - 15   The Netherlands      Seminar on Export Marketing an management for
                                                                                                          Exporters from the IT sector

                            BSOD Indonesia                       September 11 - 18   Indonesia            Identification Mission for a BSO Development
                                                                                                          Programme

                            BSOD Bosnia-Herzegovina              September 11 - 20   Bosnia Herzegovina   Working visit BSOD planning programme

                            Technical assistance mission         September 12 - 30   Sri Lanka, India     In the framework of the EDP Stationery
                                                                                                          mrs. Y. Netto will visit a number of companies

                            Trade Fair Automechanika             September 12 -17    Germany              In the framework of the EDP Mobile Equipment
                                                                                                          Parts

                            BSOD Philippines                     September 16 - 24   Philippines          Identification Mission for a BSO Development
                                                                                                          Programme

                            BSOD Jordan                          September 17 - 21   Jordan               Formulation BSO Development programme

                            BSOD FPX-Honduras                    September 18 - 19   Honduras             Signing Letter of Commitment

                            BSOD East Africa                     September 18 - 21   Uganda               Content Management session

                            Workshop Website Promotion           September 18 - 22   Colombia             Workshop on imrpoving E-Marketing capabilites
CBI News Bulletin Page 34




                                                                                                          for Exporters

                            BSOD Prompex-Peru                    September 20 - 29   Peru                 Working visit, start BSOD, planning programme

                            Workshop Market Acces                September 20 - 21   Colombia             Seminar on EU Market Access Requirements for
                            Requirements CE-marking                                                       CE marking

                            BSOD Corpei                          September 25 - 26   Ecuador              Technical Assistance MIS Corpei

                            Train the Trainer Vietnam 4th week   September 25 - 29   The Netherlands      Fourth week of the second round of the Train The
                                                                                                          Trainer programme for ITPC

                            Workshop Effective Trade Fair        September 25 - 30   India                Workshop Effective Trade Fair Participation in
                            participation                                                                 the EU for Exporters

                            Trade Fair Aquatech                  September 26 - 29   The Netherlands      In the framework of the EDP Pipes and process
                                                                                                          equipment
What                          When                  Where                    Details
ITC Executive Forum           September 27 - 30     Germany                  CBI Managing Director, Ton Lansink, will
                                                                             participate in ITC Executive Forum on Export
                                                                             development and poverty reduction

BSOD FPX-Honduras             October 2 - 6         Honduras                 Institutional Strengthening & Organisational Dev.

BSOD East Africa              October 4 - 7         Kampala, Uganda          Second Audit Mission TTT II follow up and Export
                                                                             Planning Award

BSOD Corpei                   October 8 - 13        Ecuador                  Technical Assistance MIS Corpei - seminar ITC

SEMP Garments Macedoniea      October 9 - 13        Macedonia                Workshop on Sectoral Export Marketing Planning,
                                                                             Preparing for Exports to the EU.

BSOD Vietnam                  October 15 - 23       Vietnam                  Market Information System - ITPC

BSOD REZ-RDA - Bosnia         October 16 - 27       Bosnia and Herzegovina   Working visit incl. selection interviews for
                                                                             consultants for TTT and Training BSO staff on
                                                                             datamining/market research

BSOD FPX-Honduras             October 20 - Nov. 3   Honduras                 Institutional Strengthening & Organisational Dev.

BSOD Prompex-Peru             October 23 - 27       Peru                     Institutional Strengthening & Organisational Dev.




                                                                                                                                 CBI News Bulletin 2006
Comercial Attache Ethiopia    October 30 - Nov. 3   Ethiopia                 Seminar on export promotion for Commercial
                                                                             Attachés from Ethiopia.

FAME XV                       Oct. 30 - Nov. 10     The Netherlands          Seminar on Export Marketing and Management for
                                                                             Middle Management Staff of BSOs.

Trade Fair Valve world 2006   November 7 - 9        The Netherlands          In the framework of the EDP Pipe & Process
                                                                             Equipment

Trade Fair Midest 2006        November 7 - 9        France                   In the framework of the EDP Castings and Forgings
                                                                                                                                 September/October Page 35



EXPRO 59 BPO                  November 13 - 18      The Netherlands          Seminar on Export Marketing and Management for
                                                                             exporters participating in the BPO programme

Trade Fair Electronica 2006   November 14 - 17      Germany                  In the framework of the EDP Electronic
                                                                             Components

Trade Fair Medica 2006        November 15 - 18      Germany                  In the framework of the EDP Medical Devices

Fame Balkan                   November 20 - 23      Serbia                   Seminar on Export Marketing and Management for
                                                                             Middle Management Staff of BSOs in Serbia
                    List of current CBI publications
                    Market surveys *                                                     These publications can be obtained – exclusively by exporters
                    Automotive parts & components                                 2006   and business support organisations in developing countries
                    Bodywear                                                      2004   – through a written request to CBI, or by downloading from the
                    Castings & forgings                                           2005   CBI website at www.cbi.nl BSOs situated in any of the CBI’s 35
                    Chemicals                                                     2005   target countries may also be included on the mailing list for CBI
                    Computer software and IT services                             2005   publications. Once you’re registered you will automatically
                    Cut flowers and foliage                                       2005   receive updates of publications – free of charge. If you’re
                    Domestic furniture                                            2005   interested, please download the CBI organisation profile from
                    Engineering products                                          2005   our website (http://www.cbi.nl/downloads/cbibsoprofile.doc) and
                    Electronic components                                         2005   send the form to the CBI. We can then determine whether your
                    Fasteners and builder’s hardware                              2005   BSO can be included on the mailing list.
                    Fishery products                                              2005
                    Fresh fruit and vegetables                                    2005
                    Food ingredients for industrial use                           2005
                    Footwear                                                      2004
                    Gifts and decorative articles                                 2005
                    Hand and power tools                                          2004
                    Household and furnishing textiles                             2005
                    Jewellery                                                     2004
                    Leather goods                                                 2005
                    Medical devices and medical disposables                       2005
                    Natural ingredients for cosmetics                             2006
                    Natural ingredients for pharmaceuticals                       2005   Disclaimer
                    Natural stone and natural stone products                      2004
                    Organic food products                                         2005
                    Outerwear                                                     2006   CBI market information tools
                    Personal protective equipment                                 2005
                    Pipes and process equipment                                   2005
                                                                                         Although the content of its market information tools has been
                    Plants and young plant material                               2005   compiled with the greatest care, the Centre for the Promotion
                    Preserved vegetables                                          2005   of Imports from developing countries (CBI) cannot guarantee
                    Sanitary ware and ceramic tiles                               2003
                    Sports and camping goods                                      2005
                                                                                         that the information provided is accurate and/or exhaustive,
                    Stationery items, office & school supplies                    2005   and it cannot be held liable for claims pertaining to the use of
                    Tableware, kitchenware and other household articles           2005   this information.
                    Timber and timber products                                    2005
                    Tourism: Long haul tourism market, Season 2005                2006
                    Toys and games                                                2005   The information provided is aimed at assisting the CBI target
                                                                                         group, i.e. exporters and business support organisations
                    * Only available on CD rom and via the website
                                                                                         (BSOs) in developing countries. It may, therefore, not be used
                    Market Briefs **                                                     for re-sale, the provision of consultancy services, redistribu-
                    Business Process Outsourcing                                  2005   tion or the building of databases, on a commercial basis.
                    Dried fruit                                                   2005
                    Edible nuts                                                   2005
                                                                                         For utilization of the CBI market information tools by the CBI
                    Essential oils                                                2005   target group on a non-commercial basis, the condition applies
                    Exercise books, memo and refill pads                          2005   that CBI is referred to as the source of the information.
                    Flat knitted tops for women                                   2005
                    Fruit juices and concentrates                                 2005
                                                                                         All other use is prohibited, unless explicitly approved in
                    Flat knitted tops                                             2005   writing by CBI.
                    Inductive components                                          2004
                    Iron and steel valve castings                                 2005
                    Papayas                                                       2005
                                                                                         Mailing list
                    Pencils                                                       2005   The CBI News Bulletin is sent free of charge to importers and
                    Protective footwear                                           2005   organisations in the European Union, embassies of developing
                    Protective gloves                                             2005
                    Sheet and stamped metal parts                                 2005
                                                                                         countries and to business support organisations in developing
                    Steel flanges                                                 2004   countries and to exporters who are participants of CBI pro-
                    Summer flowers                                                2005   grammes. Other individual exporters in developing countries
                    Vegetable oils                                                2005
                    Wooden products for gifts and handicrafts                     2005
                                                                                         cannot be included in the mailing list, but they can download
                    Wound closure and wound care products                         2004   the CBI News Bulletin from the CBI website at www.cbi.nl

                    Manuals
                    Export planner                                                2004
                                                                                         Correct address
                    Exporting to the European Union                               2003   When notifying the CBI of a change of address, please
                    Your show master                                              1998   return by post the original address label of the last
                    Your image builder                                            2003
                                                                                         CBI News Bulletin together with your new address
CBI News Bulletin




                    Your guide to market research                                 2003
                    Digging for gold: Internet research **                        2006   information. You may also send an email or fax
                    Website promotion: How to promote your website in the EU **   2006   containing both the old and new address to
                    ** Only available on the CBI website www.cbi.nl
                                                                                         cbi@cbi.nl or fax nr. ++31-10-4114081.

                    Others
                    Fashion forecast Spring/Summer 2006-2007                      2005
                    Tourism: ‘Matrix 2006, Netherlands’ and Belgian
                    tour operators to exotic destinations’                        2005
                    Design guide jewellery                                        2004

				
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