Maintaining strong relationships and having regular interactions with your local dealerships is vital to success, as LiuGong has demonstrated throughout its continued expansion into Europe
WHEN any business decides to expand its global reach and break into a new market, ‘on the ground’ knowledge is absolutely vital to its success.
Unless you have an intimate understanding of the unique requirements of customers in a region, you will be unable to adapt your business model accordingly, and will ultimately risk failure.
The Chinese construction machine manufacturer LiuGong has shown a strong appreciation of this need for knowledge. In 2011, their sales in Europe increased by nearly 200%, and so increasing their focus on this continent came as a natural step.
During the course of growing their European presence – underpinned by the opening of the Netherlands-based European HQ in June 2012 – LiuGong have placed great emphasis upon building strong relationships with their regional dealers.
“This new office will strengthen our presence as a top construction equipment manufacturer brand, and service our dealers and customers in the whole European market,” said Yuanxiang Xiao, President of LiuGong Machinery Europe. “Our staff will be able to gain a deeper knowledge and understanding of the needs of each local market. Not only will this allow us to react to customers more effectively, it will also help us develop products that will better meet the local requirements.”
Thanks to an ethos of regular communication between their new European hub and their network of local dealers, LiuGong have been able to glean vital insights into the demands of their European customers, and ensure that their products are constantly tailored to meet the local requirements.
“No other Chinese construction equipment manufacturer understands their customers better than we do,” said Yinfeng (Jackie) Yang, Sales & Marketing Director of Europe at LiuGong. “Our dealers are spread across Europe and our mutual trust and loyalty has been built upon years of cooperation. They provide invaluable expertise and really are our ‘front-line’ – dealing directly with customers and talking openly with them. They help build the bridges of communication that enable us to hear our customers’ voice, and they themselves appreciate that we are listening.”
And these relationships have only become even more crucial for LiuGong in recent months, as the drive into Europe is not without its challenges.
Polish distributor, Warynski Trade, has been dealing LiuGong machinery since 2005, and its Director of Foreign Trade, Wojciech Knapek, said, “One of the main features in Europe is the very stiff competition – all of the major brands are prominent players throughout this region. Furthermore, certificate requirements are growing year by year, and we need to ensure we meet all these new requirements. Any manufacturer entering this market must be 100% ready to rise to these challenges.”
For example, recalibrating specifications from Chinese machines to make them comply with EU regulations – such as StageIIIB/Tier 4i emissions requirements – can be an arduous and expensive process, as can accommodating customers’ machine preferences by region.
LiuGong’s European dealers are also feeling the benefits of closer integration. Grant McGregor (pictured above), from UK-based LiuGong distributor, Construction Plant and Machinery Sales Ltd (CPMS), attributed LiuGong’s burgeoning success to its proactive approach in understanding the complexities of its markets.
“We’ve recently been modifying machinery to suit the demolition industry,” said McGregor. “We’ve shown LiuGong the modifications, and they have guaranteed us this will now be carried out as part of the manufacturing process. I’ve never experienced this kind of action so quickly before from any manufacturer.
LiuGong has publicly stated its intention to become a top 10 construction equipment manufacturer by 2020.
