G&M Cosmetics
G&M Cosmetics is an organic certified skincare company based out of Sydney that has been manufacturing and selling to national and global retailers for over 22 years. The company applied for its first licence to export products to China in 1998 and has been exporting its products to the region ever since. The key justification for this move was to access the large and growing markets in Asia. G&M Cosmetics’ key markets now include China, Hong Kong, Taiwan, Singapore, Malaysia, USA and Thailand.
Jordanov and the team at G&M cosmetics have blazed their own path to customise their skincare products to suit market preferences in Asia and it has worked. G&M is now exporting 600,000 units of skincare products to China every week.
“We’re all humans. The number one thing is that you respect the consumer. Give them a proper product and don’t promise the impossible.” — Zvonko Jordanov, CEO, G&M Cosmetics
Understand the market and local requirements
But strong leadership vision is only part of the story. G&M also conducts extensive market research that has presented some interesting results and changed how the company has serviced different Asian markets. At their laboratory in Australia, the company looks at suitability of particular skincare for different markets based on local conditions, including local weather and humidity. A focus on creating value for money, offering quality ingredients and consistency in their approach have been key to G&M’s success.
However, they have found that customer preferences don’t always align to these conditions. Emu oil-based products are the best-selling variety in Taiwan and Malaysia but in China the first preference is for Lanolin. But these preferences are fast-changing, with avocado, goat’s milk and manuka honey products on the rise.
A sophisticated understanding of Asian markets comes from research and experience. G&M has learnt the hard way that entering markets in Asia requires up-front research before setting up and establishing a business in China. Jordanov says that when the company first established in China they did not organise their intellectual property and licences and they were dispersed among companies. This made for a regulatory nightmare. While they have since consolidated the licences under one company name, it certainly didn’t make the initial stages easy.
Find trusted partners in country
Jordanov attributes the extent of G&M’s success in China to its ability to find a trusted partner and agent in Guangzhou. Prior to that, the company had relied on ad-hoc arrangements mostly at a distance. But five years ago, Jordanov travelled to China to find a business partner whose values and vision aligned with G&M, this also led to the company registering as a business in China, which he says has led to increased brand trust in the Chinese market.
This case study originally appeared in Asialink Business and the Commonwealth Bank of Australia's report 'Activating Asia.' To read the full report, click here