Scotmas with representatives from the Botswana Water Utilities Corporation, where Scotmas aims to help provide safe, clean water to 40 rural villages in Botswana.
In the water and hygiene industry, it's not difficult for Scotmas Group to find problems around the world to solve, or a demand for their technologies. We found out about some other challenges and successes they've had on their export journey.
What does your company do?
Scotmas Group is a leading manufacturer of water treatment, hygiene and environmental care products, with a focus on biocidal technologies – products that protect us from dangerous bacteria and insects that can cause diseases.
We are best known for our extensive range of innovative and effective chlorine dioxide systems, developed with over 25 years’ experience in the market, however we are also actively involved in developing microbial biotechnology, insect repellents, insecticidal textiles and consumer product ingredients.
Our unique selling point is our focus on “green chemistry”. Sometimes it is necessary to use chemicals in order to achieve an important objective – such as disinfecting drinking water, or applying insect repellent to protect us from malaria. What Scotmas do differently, is use state of the art delivery mechanisms to cut the volume and concentrations of chemicals needed to do the same job – saving the client money, and protecting the environment.
When was your company launched, who by and why?
Scotmas Group was founded in 1998 by company Chairman and CEO Derek Cameron. A keen entrepreneur throughout his life, Mr Cameron spent most of his early years working throughout Africa in a variety of agricultural projects.
It was there that he recognised the need for a novel and effective biocide that could protect food supplies from bacterial spoilage due to heat and poor working conditions. Derek was joined at an early stage in the business by his sons, and together they now employ 42 people in the Scottish Borders and a further 10 in worldwide locations.
How long has the company been exporting?
Our first ever client was a dairy farm in Cyprus, and our company has been export focussed since we were founded. Many of the most acute problems in water treatment and hygiene are found in hot, water stressed countries – not typically a problem associated with our home market!
What do you currently export, and where to?
We currently export all across Europe, the Middle East, Southern Africa and South America. We aim to expand our presence in Asia and Australasia over the next few years.
What motivated you to start selling overseas, and how long did it take?
As a specialist firm involved in development of new water treatment technologies, it was necessary for us to target export markets from the outset in order to achieve the required scale.
Our solutions have been developed in close cooperation with customers, and one of the things we do best is to take technologies and learnings from one industry to an entirely different application in a different part of the world.
As a business focussed on specialised technologies, selling overseas was part of our business plan from day 1 – our approach is very similar to the German Mittelstand companies – family businesses which specialise in a few but perfected products, and sell them all round the world.
What is the easiest part of exporting?
Within our industry – water and hygiene – it is not difficult for us to find problems around the world to solve, or a demand for our technologies.
And the most challenging part?
Finding the correct distribution channels to ensure a sustainable market entry and maintaining those ongoing relationships is the critical issue. Our business is driven by the intangible intellectual property (IP) of our market knowledge and expertise, and there is no shortage of operators who may wish to “freeload” on our expertise. It is critical to have open, honest relationships with our distributors, and a healthy degree of mutual self-interest.
There is no “global model” that we have found that works – each country will generally take a different product and service mix, and the exporter needs to be sensitive to different local circumstances and adjust the marketing mix accordingly.
Have language barriers, currency changes, etiquette and culture ever caused you any difficulties? How did you overcome them?
Working in a key area of health and hygiene, we find that local regulatory barriers often cause a barrier to entry, and sometimes require many years of patient discussions with Governments, consultants and other influencers before a full market entry can be undertaken.
There is no quick fix to these problems, but we have found that as we have grown and developed our expertise and reference list, that regulators are now more willing to listen to us.
Did you get any support when you wanted to trade abroad? Who from, and was it helpful?
Scottish Enterprise (SE) have been on board with our business development since the start, and have provided invaluable advice, guidance and funding to help us develop our technologies in Scotland and export them overseas.
We have a dedicated account manager for both innovation and export development and have found SE to be highly supportive and helpful every step of the way.
What advice would you give to someone just starting to explore overseas markets?
Treat every export market differently. For a variety of political, economic, cultural, technical, environmental or legislative reasons, the product and service mix that works for you in one market will probably not replicate exactly to a neighbouring country, not matter how apparently similar they appear.
Choose your local distributors carefully – demand a detailed business plan for each market and build performance break clauses into any agreements to prevent costly legal issues down the line.
Where next? What markets are you looking into and where do you see the company in 5 years’ time?
We are looking into market entries to Malaysia, Singapore and Australia over the course of this year; and we have already started to develop business exporting to Taiwan and Brazil.
Over the course of 2017 we will also launch a number of innovative new products to the market as a result of a 3 year development program. We expect this to drive demand in new and existing markets for the next 2 to 3 years, and are looking forward to exciting times ahead!
Scotmas Group have been shortlisted in the Most Entrepreneurial Exporter of the Year category at the HSBC Scottish Export Awards 2017 in association with Scottish Enterprise. Join us on 22 March to celebrate international trade across Scotland.