Tim Harrap has extensive knowledge of doing business in Asia and now as recently appointed Head of Collaboration at Alvis Bros. Ltd, he shares his experience of growing cheese sales in Korea.
Alvis Bros. Ltd are farmers and cheesemakers based in north Somerset – at the heart of farmhouse cheddar production.
“We market our cheese under the Lye Cross Farm brand and supply both conventional and organic products to major retailers in the UK as well as exporting to over 30 countries.”
“We have been doing business in Asia for the last four years, mainly focusing on South Korea with some business also recently developed in Japan. We first found an Asian appetite for our products at a major international food show ANUGA in Cologne in 2009. Our farmhouse cheeses caught the attention of a South Korean distributor with European connections and with their help we started supplying some of the major stores including Homeplus (Tesco), Lotte and E-Mart. We also sent bulk shipments of our West Country farmhouse cheddar to some of the major South Korean dairies.
2012 was certainly pivotal year for us in South Korea, with sales growing by 50%. Much of this success can be attributed to market insight and support we have received from UK Trade and Investment (UKTI) as well as our focus on showcasing our brand and educating trade and consumers about our cheese and production methods.
As a long-established West Country cheese maker, (we are celebrating 62 years of cheese making this year) ,we have a compelling story to tell. Our West Country Farmhouse Cheddar carries the PDO (Product of Designated Origin) symbol from the EU which signifies its authenticity as the original cheddar. Coupled with our long term commitment to organic cheddar production, (we are the largest maker in the UK), this has enabled us to gain real traction in South Korea. The PDO symbol clearly displayed on packs helps to reassure both trade and consumers of the authenticity and the quality of our cheese range.
In 2012, we were approached by a South Korean TV company looking for a British organic cheesemaker to film. They wanted to film our cheesemaking journey from the cows grazing in the Somerset fields to the production and maturing of our cheddar. We couldn’t have asked for a better opportunity!
So on a cold January day we welcomed Hyojae Lee, a South Korean version of Joanna Lumley and SBS Korean TV crew to our farm in Somerset. With the programme broadcast in South Korea in February, it was the perfect opportunity to tell our story, educate our customers and raise our brand profile.
Following this in March, I went on a trade mission to South Korea organised by UKTI with Ian Bugg, our Sales and Marketing Director. We took part in five days of store visits, networking and sampling opportunities and met with our key dairy customers and retail buyers. As well as deepening our insight into the South Korean market, our distributor also discussed our involvement in a British promotion in the Lotte department store which eventually ran just before the Olympics.
The highlight though was taking part in The British Lifestyle Showcase in Seoul hosted by the British Ambassador, Scott Wightman in his Residence garden.
We joined 24 other British companies from various industry sectors, showcasing our brands to over 450 invited guests including buyers, influencers and media. South Koreans are world renowned for their love of style and are highly brand and image conscious. They’re particularly receptive to the cachet of brand ‘Britain’ and attribute a great deal of prestige to imported products; the show case really tapped into this.
Nothing beats actually taking time to visit and explore South Korea even when you already have business there. You can’t escape the energy and drive there – they’re keen to do business and there are always new opportunities. In fact, one of our biggest challenges is ensuring regular and continuous supply in the face of rapid growth of opportunities.
I definitely think that South Korea is a great place to do business as there is such a strong interest in Britain and its culture so our imported products are sought after by consumers. The biggest driver of this change is the EU-South Korea Free Trade Agreement (FTA) implemented in July 2011. As part of this agreement, tariffs on many goods imported to South Korea from the UK are no longer imposed or being reduced over the next few years.
South Koreans are also great to do business with; I’d describe them as the Asian equivalent of the Finnish! They’re direct and know what they want, they’re good at making decisions and sticking to them but at the same time have a real attention to detail.
My advice though is to do your homework before visiting the market. Don’t underestimate the value of an OMIS (Overseas Market Introduction Service) offered by UKTI. It’s both a cost effective and efficient way to get under the skin of the market and see the potential for your business before committing to a visit.
After such a positive year for us in South Korea, we’ll continue to establish our brand there as well as start looking at other fast emerging markets such as Taiwan, Vietnam, Malaysia, and Indonesia over the coming years.
Tim’s top tips for doing business in South Korea:
1. You have to be aware of their culture and history also to be aware of your own history! With a highly educated population you will be surprised how much they know about your country. Do not be caught out especially when preparing to meet potential customers.
2. South Korean consumers put great deal of kudos on imported British products, so don’t be afraid to promote your products under the British banner
3. You need to educate the consumers about your product and story – for us we have to demonstrate how different our cheese is to the sliced processed varieties
4. Make the most of UKTI services to help you explore and penetrate the market, they are so well informed and can really leverage their connections, which gives you a real head start when visiting the market
UK companies interested in doing business in this market may be interested in South Korea – GREAT week which is a multi sector event taking place 31st March to 3rd April 2014.
The GREAT Week in South Korea will give UK-based businesses the opportunity to join government-led trade missions to meet major buyers, potential partners and influential opinion formers in market.
Further information can be found here http://opentoexport.com/events/south-korea-great-week-multi-sector/
Alvis Bros facts and figures
- The Alvis family have been making the highest quality award-winning cheddar on the farm since 1952 so the third generation are now celebrating 60 years of the business
- Over 1000 milking cows from three farms supply local milk to make 60 tons of cheese per week
- The family is committed to exports and now sells its cheese to 30 markets around the world from Saudi Arabia to South Africa.
For more information: http://www.lyecrossfarm.co.uk