EXCEL COMPONENTS MFG CO., LTD. Fastening the Latin American Market Corporate Principle: “Friendship Prior to Business”

 “Be brave and agile!” said EXCEL COMPONENTS MFGsales representative Mr. Reginald who shared tips to cultivating relationships with Latin American clients. This is what the company came to realize after all those 10 years in the Latin American market.

Energetic Latin America

In April 2013, Latin American nations, including Argentina, Venezuela, Mexico, and Brazil, exhibited the same PMI index as the US and surpassed Europe. Besides, Brazil has overtaken other emerging countries and is aligned with India as one of the two nations with the highest index of the economic development.

“EXCEL has always been ambitious for the Latin American market.” 10 years ago it entered Latin America and successfully made connections with current clients 6 years ago. It has clients in Mexico, Brazil, and El Salvador. Its Mexican clients were introduced by its American clients. Now the company is proactively making preparation, including machinery procurement, for this vast market. At the end of this year, it will move to a new plant.

Do You have Enough Capacity to Cope with the Delivery to Latin America?

Usually, the volume of a single deal with any Latin American enterprise is bigger than others because their main clients are mostly from governmental organizations, and bidding is almost the only method to make deals with them. “Price and delivery are the most important in bidding,” said Reginald. He said that the company specializes in OEM customized parts as per drawing and substantial investment in QC has made the stability of products and service of the company keep elevating.

In addition, numerous orders come with tight delivery dates and delayed orders are not acceptable. As a result, how to make supplies and arrange manpower efficiently has made “progress arrangement” become the most important issue. Reginald said, “We have plants in Taiwan and China, so we can decide which products to be produced by which plant depending on situations to meet clients’ versatile needs.”

Start “Steadily” 

Reginald pointed out the dilemma in entering Latin America is “Collecting payment is not easy.” He thinks the personality of people in the region is unlike those of Europeans and Americans who care about time accuracy. With over 30 years of experience in the field of machining parts, EXCEL focuses on customized products which are mostly applied to auto maintenance parts and medical hardware including CNC machining, precision processing, molding and forming, all of which demonstrate a certain level and technical experience. In the past, the company kept focusing on the European and American markets. As European and American clients turned to the “high volume with low price” strategy, the company started to transfer to the Latin American market. The company has spent one third of its history on cultivating this region that is ready to boom. Reginald expressed, “There will be a lot of problems in the course of dealing, but there will be also solutions coming from the company’s own experience.”

He pointed out another key concept of making good business- good interactions with clients. Latin Americans are passionate and romantic in nature and don’t merely focus on business deals. If you contact them only for business deals, you will not receive too many feedbacks. Treat the clients as friends, and make the best of the product quality. By doing so, clients will naturally place you an order with trust and introduce you to other clients, “just like when you come across a delicious restaurant you will naturally share it to your friends.”

Eyeing Auto and Medical Segments

EXCEL has been probing into the Latin American market trend for nearly 10 years, and found that local petroleum industry is on the rise with booming economic development that drives up car demand and other related industry growth. Focusing on auto maintenance parts and medical hardware, the company thinks the market of the region is full of niches. So far, major auto plants, including self-owned brands in China, have numerous production bases around the world. While those Chinese brands turned to Latin America and set up local plants, they also brought along their part suppliers, which originally supplied auto plants in China. “Therefore, we do the same by supplying products to Latin America,” said Reginald.

“No Quality, No Clients. Let Alone Business Operation”

Recently, import and export restrictions of Latin American market are following the global trend. Reginald pointed out that Chile and Venezuela are next targets of the company because “Chile has one of the largest population growth and is the top export destination country for self-owned auto brands in China.” Venezuela has a high proportion of English speakers, and its culture is a combination of Latin America and the US due to its geological location; therefore, there are less barriers in doing business in Venezuela.

EXCEL suggests that those who want to enter the region should prepare with “adequate capacity” to cope with Latin Americans’ high-volume orders and short lead time. In this challenge, time is the key and there is no compromise for delayed delivery. In addition, “being sensitive” should also be maintained because the system in the region (unlike European and US culture) is not complete yet, and unpredictable policy changes are prone to occur. Thus, unfamiliarity to their trading rules usually means unfavorable losses in business deals. Another critical point is to pay visits to clients. Maintaining good interactions with clients, following market trends, satisfying clients’ needs, and establishing friendship will help you reap more. Last but not the least, “set product quality as the top priority.” No matter which market you will invest in, put efforts and concentrate on QC with the same method because EXCEL firmly believes “no quality means no clients.”