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BIZCHINA / Chemical |
Chemical firm cultivates the Chinese marketBy ()
Updated: 2007-06-26 11:14 ANGUS Chemical Company, established in 1936 in the US and acquired by Dow Chemical Company in 1999, is a leading producer of nitroalkanes and derivatives, with more than 50 years of nitroalkane chemistry experience. It has manufacturing facilities in the US and Germany. In China, ANGUS focuses on six key markets: paintings and coatings, personal care and cosmetics, leather, metalworking fluids, life sciences facilities and rubber. Dow Biocides, a business unit of Dow Chemical Company, helps customers solve microbial challenges during the manufacturing process. Though ANGUS and Dow Biocides are two separate businesses, they are connected where their customers want them to be for efficiency. In China, the two businesses have sales teams in Beijing, Shanghai, Guangzhou and Taipei. They set up a customer application center in Shanghai in 2006 and will open another in Guangzhou next year. They have promised to invest $2.5 million every year into the two centers to enhance facility and personnel build-up. To better tap and serve the Chinese market, ANGUS and Dow Biocides launched the "In China, for China" strategy in 2004. Mark Henning, president and CEO of ANGUS and general manager of Dow Biocides, talked about the strategy and how its efforts are paying off in China. Q: Why did you launch the "In China, for China" strategy? Could you please explain the strategy? A: We want to be more involved in China's economic development, not only for acquiring market share. I still remember very vividly that lots of people rushed to China for low-cost manufacturing products several years ago. I was also in the line then. I met many purchasers on the plane every time I was flying to China. But I gradually found out that what's really valuable in China is not the low-cost products here, but China itself. We eventually visited some enterprises in the chemical industry and our customers, and realized that we should come to China not for low-cost products but for developing the market itself. As a result, we formulated the "In China, for China" strategy. We are committed to ensuring our customers have better access to superior products, technology and application specialists. It is important to have local expertise and understanding of issues and trends impacting the local market. We have made significant progress in increasing capabilities - from quality local sourcing of products to building local customer application technology centers, investing around $2.5 million annually on people and technology. Our local manufacturing, technology and application support and local sourcing investments position our businesses for long-term growth in China. Q: What's your perspective on the chemical industry in China? A: We had predicted that China would become the second-largest producer of chemical products after the US by 2015. Our prediction is relatively conservative because we made the forecast just from the perspective of industrial development. Calculated according to population size, the market would be much larger. China's population is four to five times that of the US. Q: What's the biocides market like in the United States compared with China? A: In terms of size, the Chinese market is smaller, about 5 percent of the US market. But with China's rapid economic development, the market will expand much faster. Both the global biocides and the specialty chemicals industries are growing at around 6 percent, while China is experiencing growth rates in these key areas of between 12 and 15 percent annually. With living standards improving, Chinese people are buying new consumer products like houses and cars. Once consumption picks up, the market for biocides will expand even faster. Our products and technologies can help improve the quality of life for Chinese people in areas of health with disinfectants for people and animals, to making paints more durable and better textiles. Q: Does it mean that more training is needed to foster the market? A: Yes. We need to enhance consumer awareness and create demand. But we don't expect quick results. Q: How would you rate your company's achievements in China? A: We have realized our target here in the past years. We had set a higher-than-average growth rate as target and we achieved it. Q: Some say developed countries transfer high-pollution manufacturing to China. Do you agree? A: Dow doesn't do it. We adopt the most advanced environment standards and maintain the same in all countries. We have advanced technologies and don't need to cut corners to make profit. (For more biz stories, please visit Industry Updates)
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