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The Gentle Art of Interdependence: Advice for New Exporters
By Jill Lee
Gupreet Malik, an Indian-born importer
working in Nigeria, was making a stop for ice cream while on
business in Chicago. He was tasting every flavor available,
thinking about its sweetness and texture.
This was not, however, because he had a killer sweet tooth. Malik was at a food trade show, and he was hungry for profitable new products.
Dan Duran, representative for Blue Bunny Ice Cream in Le Mars, Iowa, was happy to oblige with a sample of strawberry. Blue Bunny now markets its ice cream not only in Africa, but also, as of this year, in India. The reason: Malik was impressed with the product, trusted Duran and sold his product as soon as export rules allowed him to sell in India.
Blue Bunny Ice Cream, owned by Wells’ Dairy, is the largest family owned and operated dairy processor in the United States. The company, founded in 1913, is located just north of Sioux City. The business employs 2,000 people in a town of 10,000. Its sales have been estimated at $500 million, and its international sales have reached into the millions. Blue Bunny’s competitors include international conglomerates such as Nestle and Unilever.
Blue Bunny is sold in 26 countries throughout the Caribbean, South America, Africa, Russia and Asia. Roughly 70 percent of the products it sells overseas are prepackaged novelty ice cream treats like "The Big Dipper," a round-top cone containing premium ice cream. The other 30 percent is packaged ice cream sold to restaurants and supermarkets.
Blue Bunny has been working in international markets for about a decade.
Duran, head of exports for Blue Bunny, has been a part of international marketing from the beginning. He’s won awards from FAS for his innovative marketing style and willingness to train new exporters.
His first success was in Mexico, selling to mom-and-pop groceries near the U.S. border. Now, with a decade of experience, he’s agreed to talk with AgExporter about things novice exporters should know.
1. Is the Infrastructure There?
Case in point: When a shipment of Blue Bunny ice cream reaches Lagos, Nigeria, Malik assigns an employee to stay at the port and watch the shipment, overnight if necessary, until it goes into cold storage at his warehouse. The reason: The shipping trailers have refrigeration systems that must not be turned off. Twenty minutes is all it takes to spoil the product.
"The average Nigerian consumer pays a premium price for a carton of Blue Bunny ice cream. What are they going to think if it tastes bad because of temperature abuse during shipping?" asks Duran.
He is quick to add that he shares
responsibility for monitoring infrastructure with the importer.
When Duran gets a new overseas importer, he makes it a point to
tour their facilities and make sure they can keep his product
cold. He has no problem telling an importer he’s
uncomfortable with an arrangement, knowing bad ice cream will
reflect poorly on them both. "I don’t belittle them, I
just say ‘We’re not ready,’ " he explains.
Performance cuts both ways.
If a new importer-partner questions whether Blue Bunny can meet their growing shipping demands, Duran invites the skeptic to tour the Iowa plant to get a feel for its capacity–and its 10-story refrigeration storage warehouse.
"When we start, they tell me they are interested in selling my product," he said. "What I look for is when they say they’re checking the refrigeration at stores they distribute to, so our product retains quality."
2. Determination is an Asset
Duran said there are plenty of times where he experienced setbacks in opening new international markets. The key is not to get discouraged. The USDA’s Foreign Agricultural Service, state department of agriculture and regional trade associations can sometimes help you break into new markets. Still, it takes patience and determination to see a new market through.
"When we’re opening a new market there are lots of situations where it’s tempting to give up–but we usually don’t," said Duran. "You have to deal with some frustration, and look for ways around problems."
3. Will a Trade Show Help Me?
One thing FAS and trade groups do to help potential exporters is sponsor or endorse international trade shows. They are powerful opportunities to meet prospective importers, according to Duran.
He also believes it is important to "get there first." That’s why one of his employees just returned from the AgraMark trade show in Ho Chi Minh City in Vietnam.
"Right now Vietnam is still negotiating to join the World Trade Organization," said Duran. "By the time their market really opens up, it’s going to be too late to build these relationships– you’ll be left behind with the also-rans. That’s why you have to think and invest sometimes two years ahead."
4. Believe in Your Product
Exporters shouldn’t assume they have to alter their products for export.
In support of this, Duran cites the
example of his sushi-eating Army buddies who now live in Texas.
Back in their service days, those guys would never have accepted
the idea of eating raw fish. These days, the closer a restaurant
is to the traditional Japanese, the more they like it.
People in other cultures could easily feel the same about ice cream from the United States.
"In some countries, ice cream is manufactured with vegetable oil in place of butterfat. When people who have never eaten butterfat ice cream try it, their eyes kinda pop out. They can’t believe how smooth and creamy it tastes.
Duran adds that exporters can also capitalize on other countries’ perceptions of the United States. In Latin America and the Philippines, Blue Bunny vendors are outfitted in spotless white.
"It ties in with the idea that food from the United States is held to high sanitary standards," said Duran. "The white uniform reminds people of our reputation for cleanliness."
"That Blue Bunny trademark on their product is distinctive," said Scott Bleggi, an FAS outreach officer, based in Des Moines, Iowa. "But even if you don’t have something like that, an American flag on the label really helps."
Bleggi also noted that trademarks can be a big help in some countries where literacy is low.
5. Respect an Importer’s Needs
Before the North American Free Trade Agreement (NAFTA) took effect, the company simply applied Spanish-translated stickers in strategic locations on the packaging. With the coming of NAFTA, Blue Bunny was required to outfit its Mexico-bound product in separate Spanish-only packaging.
"When you multiply that extra production cost by the 2,000 items we sell, you can see why we had to narrow our scope and produce a line for Mexico. Some companies just gave up, but you can’t have a double standard–U.S. importers expect the same of products from Mexico."
6. Appreciate How FAS Can Help
When any of Duran’s sales staff make an overseas trip, they make it their business to touch base with the FAS agricultural attache at the U.S. embassy. Post officials can sometimes speak directly to a country’s key decision makers on an exporter’s behalf. Back home, exporters should seek out their FAS state contacts who can provide export assistance. Duran adds he appreciates state outreach personnel’s ability to inspire.
"You have to work at the local, state and federal levels to get information and support that will assist you in creating opportunities for export sales. Do your homework and be willing to go the distance and your efforts will be rewarded," Bleggi said.
_____________________________
Dan Duran is an export manager with Blue Bunny Ice Cream, a
division of Wells’ Dairy, Inc., Le Mars, Iowa. Tel.: (712)
546-4000; Fax: (712) 546-4440; E-mail: dsduran@bluebunny.com;
Homepage: www.bluebunny.com
Scott Bleggi is the FAS State Outreach Officer in Des Moines, Iowa. Tel.: (515) 254-1540 ext-653; Fax: (515) 254-1573; E-mail: bleggi@fas.usda.gov
More Tips on Getting Started
Scott Bleggi, who runs FAS’ Export Outreach Office in Des Moines, said he often cites Wells’ Dairy as an example of a successful exporting company in the Midwest.
"Success starts with a commitment at the top. The company decided 12 years ago to pursue overseas markets and did so aggressively," he said.
"Dan Duran is a good example of a sale executive who actively seek partners and builds relationships. I noticed this back when I was stationed in Costa Rica with FAS, and Dan was getting Blue Bunny established in Central America."
Bleggi pointed out that beginning exporters need to think locally to grow globally.
"I always tell them to start right in their own home town. There are local, state, regional and federal agencies that can help you make the decision on whether exporting is right for your company."
Bleggi likes to talk about a "ladder of assistance" that moves from Main Street to Washington and overseas. This ladder is the way to success for aspiring exporters. It starts with your nearby chamber of commerce, local trade groups and state promotional agencies. Next are the four regional trade groups and, finally, the federal trade agencies. All can offer help–but exporters need to know whom to call when.
Bleggi adds that many successful companies such as Wells’ Dairy are proud of their success and willing to mentor other, less experienced firms.
Aspiring exporters may not all be aware of the four main regional trade groups in the United States–but they should be. These groups, which represent a host of state departments of agriculture and trade associations, can all be a real help with promotions overseas. It’s worth noting that special promotions can sometimes be focused on one company or a product of a particular region.
The regional associations are:
Southern United States Trade Association (SUSTA)
New Orleans, La. (504) 568-5986.Western United States Agricultural Trade Association (WUSATA)
Vancouver, Wash. (360) 574-2627.Mid-America International Agri-Trade Council (MIATCO)
Chicago, Ill. (312) 944-3030.Export USA Northeast
Philadelphia, Pa. (215) 829-9111.
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