Thinking big, going global

Above: Leigh Coulter of GGS Structures, with Andrew Hendriks, of Hendriks Greenhouses, in the greenhouses GGS built for Hendricks. (Photo: John Rennison)

GGS President Leigh Coulter was interviewed in a Canadian business publication, for her take on manufacturing and global markets:

It may seem a daunting task to take a business to the world market but, for companies that do, the payoff can be rewarding — and educational.

Leigh Coulter got the call on a Friday afternoon.

The Japanese customer she had been working with for months wanted to meet with her in person — on Monday.

Coulter, owner of Growers Greenhouse Supplies (GGS) in Vineland, had been working with the Japanese firm on bid pricing for a project.

“On Saturday I jumped on a plane with a change of clothes, a book on how to do business in Japan, and a Japanese-English dictionary,” she said.

Coulter’s story is reflective of dozens of Hamilton area business owners who have gone global — either selling and shipping goods to foreign markets, or bought or built manufacturing plants, distribution centres, sales offices in countries far from the city’s horizon.

Too many businesses, however, are not thinking big enough. That’s according to Robert Hattin, president of ProVantage Automation in Ancaster and chairperson of the Canadian Manufacturers and Exporters.

“Too often, the thinking is when the company gets bigger than me or my team — there are two ways out.

“You can sell to a private equity firm or public company where you can likely get three times the value than to sell to a fellow entrepreneur. How do you turn that down?

“Or (you can) grow it.”

Ontario has the lion’s share of companies who are exporting enterprises —16,681 in 2012, nearly half of all enterprises in Canada — but the figures remained largely stagnant from the previous four years.

In March, HSBC Global issued a Canada Trade Forecast Report which suggested the national export performance has recently faltered as a result of weak external demand and a declining export share.

Hattin says Canadian companies should think globally — because by thinking of how to compete with the world, companies will improve.

“By thinking big, you change the way you think. That’s why the global markets are so important. If you’re going to start up a business, start with a global business plan, not a Canadian or Ontario plan, a global plan. There isn’t enough business here. There just isn’t,” he said.

Coulter’s story also illustrates both the grim determination and risk tolerance required as well as the imperative need to understand foreign business cultural practices in order to run a successful global business.

“I went to a meeting with a president of a big seed company,” she remembered of that Monday morning. “I had a translator on my left, distributor on my right. The client was across from me. The client would ask me questions. If I could answer yes, I would answer yes in Japanese because it’s easy. It’s hi — very short. If I had to answer no I would let the translator explain no. The Japanese are not facially expressive people. So I had no idea how it went.”

It went well. GGS got the job. It was 1994. That relationship resulted in the establishment of GGS’s first distribution centre outside North America and helped it grow to be one of the largest greenhouse manufacturers on the continent.

Russ Chapman, president of Firebridge, a Burlington-based engineering firm, said cultural barriers were at the heart of his struggles to break into business in Chile. He spent a number of years and more money than he wants to count and has now called it quits. But only in Chile.

He is confident his company can help foreign companies save money with improved processes — he’s done it over and over in North America. It’s just a matter of time, patience, and perhaps the right people. He really doesn’t have a choice — the market in Ontario is too small.

“The potential is so enormous. We should be the poster child of what the government is trying to do: technical, exportable technology and we are in the business of saving emissions,” he said, frustrated.

So Chapman has hired a Chinese-Canadian who is helping facilitate meetings in China, where he hopes to visit in the spring.

Hattin said agencies such as Export Development Canada and organizations such as McKinsey & Company can provide excellent information about expanding globally.

He points to an EDC program which helps Canadian companies acquire or partner with foreign ones. He initially questioned the program, why it seemed to export jobs.

“(The EDC) said this: The wealth will come back to us in the form of profits and taxes. You will learn more about how they are successful and therefore the entity collective will be much better.”

Coulter said there are many reasons to be worried about the risks of operating offshore, but there are risks in everything.

If she had not been willing to jump on a plane to fly to Japan in two days, it would have been a crucial mistake.

“I found out they had been working with another company for 10 years and if I had not made the meeting, they would have had to give it to this other company.

“There are always lots of reasons not to do something until you do it. Then there’s no reason. Why is it possible to ship steel-manufactured greenhouses to Japan? The freight costs are ridiculous, the enormous language barriers, the legal issues — it took us five years to get approved by the building code. There’s all of those — and there are hundreds more.

“But on a Friday, ‘We need you on the other side of the world and maybe you get the job.’ We’ve been doing business with them and we now have a new product line.”

By Lisa Grace Marr , The Hamilton Spectator