Growing by Going Global
5 success stories prove that small, local companies can flourish nationally and internationally
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The Shangri-La Boracay Resort in the Philippines was
Global experiences in their niche
Following its first design project — renovation of the venerable Royal Hawaiian Hotel in 1945 — Honolulu-based WATG was well positioned for the postwar boom in hotel and resort development in the Pacific.
“That instantly established us and we became quickly known in Hawaii and throughout the region for that expertise. I don’t think it was a grand plan. It was confluence of being in the right place at the right time,” says Howard Wolff, senior VP for the firm formerly known as Wimberly Allison Tong & Goo. “It was natural for us to start exporting our services because there was nobody in Fiji or Tahiti who had that knowledge.”
Today, roughly 87 percent of WATG projects are outside the U.S., most in Asia and the Pacific, but also in Africa, the Middle East, Europe, the Caribbean and Latin America.
Wolff said WATG made the choice early on to focus on the hospitality industry. “In the process, we developed a reputation and were able to develop relationships with people in the travel and hotel-development business. We were competing with firms that dabbled with hotels along with hospitals, schools and sewage treatment plants,” he says. “We were able to show this is our focus, this is what we do.”
As new hotel construction stalled in Hawaii, resort owners embarked on major renovation and refurbishing to reposition their properties for evolving travel markets. WATG evolved, too, adding master-planning and interior- and landscape-design services to stay competitive.
Even though its operations are widespread, with offices in Honolulu, Irvine, Calif., Orlando, Fla., Seattle, London and Singapore, Wolff says there is close collaboration between company branches, so that, for example, the Seattle office may do work for a client relationship maintained in Honolulu.
“One of the things we determined pretty early on is that we wanted to act as one global firm even though we had multiple locations. That meant not having each office be an individual profit center,” he says. “By determining that, we have been able to collaborate. One of the ways to deliver services as a single company is by sharing work, moving projects and people around depending on the workload and skill set required. It’s not unusual, for instance, for people in our Honolulu office to spend a few weeks or months in London or the Singapore office and vice versa.”
Even with WATG’s vast international experience, there have been a few missteps along the way.
“You can waste time and money by being too early in a location,” Wolff says. “For example, we were showing work in China in the early 1970s that never got built and we were never paid for. There was a lot of interest but not a lot of ability to make things happen back then. We decided to wait until they got their act together in terms of private-sector development and now our work in China is 40 percent of our business worldwide.”
watg.com // 521-8888
First Steps to Export Success
Japan and China seem like the obvious markets for Hawaii products and services, but small-business export wannabes might do better targeting Canada, Singapore or Hong Kong, says the head of the Hawaii U.S. Export Assistance Center.
John Holman says open trade, less stringent regulations and product standards more closely aligned with those in the U.S. are just a few reasons those three places may be more welcoming to first-time exporters from Hawaii.
“Target the markets that are the easiest to get into in the shortest amount of time with the least amount of cost and you’ll see the biggest return on your investment,” he said.
Like the Japanese, Canadians have a strong affinity for the Hawaii brand, Holman says, and many residents there and in Singapore and Hong Kong have more disposable income to pay for premium products such as macadamia nuts and Kona coffee.
Plus, exporters can use distributors in the two smaller Asian countries to springboard into larger regional markets, he says.
“If you are a small Hawaii company and find a really good, reputable partner in Singapore and Hong Kong, you can end up making sales in other countries,” he says.
The Hawaii U.S. Export Assistance Center, under the Department of Commerce’s U.S. Commercial Service, is part of a network of offices in more than 100 U.S. cities and in 89 foreign countries that counsel small- and medium-size companies planning to expand sales into international markets.
The agency can help business owners create market-entry strategies, navigate documentation, and provide market data, trade leads and information on trade shows and missions.
Holman says the centers worldwide “know who the players are” in foreign manufacturing and distribution, making it easier for Hawaii companies to hook up with reputable partners overseas.
“The single most important factor is finding really good partners,” he says. “If businesses partner up with a company randomly, they could spend two or three years before realizing this isn’t really working out for them, and in the meantime they may have damaged their brand in that market and maybe lost money.”
But even before taking that step, business owners aspiring to go global should first ask themselves hard questions, such as whether they can handle a big boost in demand for their products or services, and whether they are willing to get the financial resources needed to increase capacity.
“Whenever I talk to a company with export hopes I ask, ‘If we find a distributor for you in another market, and if sales go up 20 percent, can you meet that extra demand?’ Many cannot. The worst thing that can happen is getting a big contract and not being able to fill that order,” Holman says.
“We want companies to not think of exporting as a side thing. It’s really something you want to focus on developing for long-term success. Making a sale here or there is cool, but if you don’t nourish and put resources behind it, it’s going to falter, and when the economy falters it’s not going to be there for you.”
Research is essential to determining if a product or service is exportable and identifying potential markets, but small businesses don’t have to establish a presence overseas or engage in costly travel to find that out, according to Dave Erdman, founder of PacRim Marketing Group and PRTech LLC, two Hawaii companies focusing on the Asian travel market.
“One place companies are able to test market is the visitor market in Honolulu or on the Neighbor Islands. We have a terrific testing ground right here in Hawaii,” he says.
Hawaii U.S. Export Assistance Center
Honolulu // 522-8040
Nine Hawaii companies with exporting success were recently honored by Gov. Linda Lingle, the U.S. Department of Commerce and the federal Small Business Administration. Receiving Export Achievement Certificate awards from the Hawaii Export Assistance Center were:
• Cyanotech Corp., which produces microalgae-based nutritional supplements at the Natural Energy Laboratory of Hawaii on the Big Island and exports to more than 40 countries. With support from the U.S. Commercial Service, Cyanotech established a partnership in India that has the potential for sales in Pakistan, Sri Lanka and Bangladesh.
• Hamakua Macadamia Nut Co., which produces roasted and flavored macadamia nuts on the Big Island and recently secured a Hong Kong distributor.
• Hawaiian Island Shine, which makes auto-care products. Collaborating with the state and the export center, the company secured its first international distribution partnership with a major retail chain in Latin America and is now exporting to five countries in the region.
• Maui Babe, a Maui-based company that manufactures and sells sun-related skin-care products. With the export center’s help, Maui Babe found a distributor for Australia and New Zealand.
• Noni Biotech International, a noni fruit grower and manufacturer and distributor of juices and skin-care products. The company worked with the export center to make its first sale of a container to a new distributor in South Korea.
• Honua Technologies, which designs and manufactures bio-hazardous waste disposal and treatment systems. With support from the state and the U.S. Commercial Service, it secured a Chinese partner, resulting in major sales of steam sterilizers and ancillary equipment.
Also honored during the May 19 awards were Baldridge & Associates, PRTech LLC and Tradewinds Global. Beth Tokioka, of the Kauai Mayor’s Office, was credited for her support of export efforts through the Made in Kauai program.
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