Doing business in Asia: CP Kelco’s all-in hub approach

CP Kelco has taken an all-in approach to doing business in Asia through its hub-and-laboratory system, which allows the company to react faster to customer demands, according to its country director for Thailand, Indonesia and Vietnam. 

Speaking at Fi Asia-Thailand, Amy Wong said the functional foods, stabilisers and thickeners major has had a long established Asia-Pacific headquarters in Shanghai, but more recently it has realised it cannot support the diversity of the entire region from just the one location. 

“There are quite obviously different expectations from customers from India, China, Southeast Asia and other countries, so we have recently been reorganising ourselves to introduce a hub-based model​,” says Wong.

“Now we have a home in Shanghai to service our customers in Greater China and Korea, but we also have a hub in Singapore supporting Southeast Asia all the way down to Australia and New Zealand, as well as India​.”

Forging closer partnerships​

These two hubs provide application and marketing support, press functions and general team support, which the company believes makes it able to work more closely with customers.

“Apart from that, we have found the need to have laboratories in local regions so that we can really be in touch with a country's trends​. 

“For example, in India we have a lab that services Greater India because expectations for flavour profiles are completely different in India compared to the rest of the Asia-Pacific region​. 

“And we need to  have people on the ground with locals there who understand what the needs are and who have the ability to turn things round quickly using a very customer-focused approach​.”

On top of the centralised functions of each hub and lab, CP Kelco also works with regional partners, who understand the local language and localised customer needs.

“It's their country so these agents are very important proxies to meet with customers every day and respond with their needs to our regional hubs​,” adds Richard Yin, the company’s Asia-Pacific marketing director. “We then cascade this back to the global office to trigger innovations in a global area​.

“How could you support a country like India or Vietnam from the other side of the world without understanding the culture and customer preferences, as well as their struggles with economies going up and down​?”

However, the regional offices are not entirely autonomous, with CP Kelco’s corporate vision flowing out of its headquarters in Atlanta, but the regions are able to customise this through their hubs to provide a better fit for the customer mix.

Differing markets​

So how widely do the markets within each Asia hub vary? According to Yin, the basic needs for eastern China and the other more developed emerging markets like Malaysia and Singapore are on the whole very similar, and grow in comparable ways. 

“Both regions have growing economies and their consumers tend to favour fast-moving consumer goods, including packaged food, beverages and any other personal care-related products​.

“When people have their basic requirements serviced well, they then graduate from entry-level products to higher-quality​.

“You see a lot of commonalities, but then in Indonesia, Thailand, Laos and Vietnam, maybe - as well as most of China - have yet to migrate from services surrounding basic needs. Their requirements, such as cost of use or flavour, can be very different from the more developed areas​.”