Chinese e-commerce

Target China’s booming e-commerce market

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China delivers 40% of global e-commerce retail sales, with a market value that exceeds US $1 trillion.

China has overtaken the US to become the world’s number one online shopping market, with the country currently accounting for more than 40% of global e-commerce retail sales. As a result, China’s e-commerce market value now exceeds US $1 trillion. Two of China’s biggest players in this market played a big part in this. In 2017, Alibaba and Tencent delivered record-breaking profits, demonstrating just how healthy China’s consumer market remains. Alibaba’s profit almost doubled to US $2.1 billion and Tencent’s grew by 70% to a value of US $2.7 billion during the period.

Cross-border e-commerce has grown rapidly in China, signalling the importance of foreign brands to Chinese consumers. The cross-border e-commerce market reached 7.5 trillion RMB in 2017 (the figure includes both B2C and B2B cross-border e-commerce). The main driver for this is Chinese consumer demand for a wider selection of better quality products.

Enterprise Ireland has ramped up its supports to encourage more companies to capitalise on the potential of this lucrative market. Several companies supported by Enterprise Ireland, including Emerald Green Baby, Ovelle, Irish Breeze, Max Benjamin, Allied Imports, Newbridge and ClevaMama, are already present on e-commerce platforms in China.

Company logos

Enterprise Ireland provides support in the following areas:

  • Introductions to Chinese e-commerce platforms
  • Introductions to Chinese third-party operators, who can assist in a variety of sectors, such as jewellery, mother and baby products, and cosmetics
  • Connections with local Chinese buyers, including department stores and hotels

 

For more information on how Enterprise Ireland can help you access the Chinese market contact our Shanghai office on +86 21 6010 1380 or email jonathan.nie@enterprise-ireland.com.

Big Ideas in Irish medtech sector

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Enterprise Ireland’s annual Big Ideas event highlights Irish university research projects with high commercialisation potential but that require additional investment to become fully market ready.

More than half of the 12 projects showcased at Big Ideas 2018 involved new developments in the medtech sector. The figure isn’t so surprising when you remember that Ireland is the largest employer of medtech professionals in Europe per capita, with 450 medtech companies employing 38,000 people, and producing annual exports worth €12.6 billion to more than 100 countries worldwide.

Ireland has also worked to support connections between clinicians and the healthcare sector, with the Health Innovation Hub Ireland (HIHI) established to drive collaboration between the health service and enterprise. It offers companies the opportunity to carry out pilot and clinical validation studies, and offers the health service access to innovative products, services and devices that it may not otherwise be exposed to.

Tom Kelly, divisional manager for life sciences at Enterprise Ireland argues that Ireland’s compact geographic scale is to its advantage in becoming a medtech hub: “Because we are small there is huge interaction between the multinational and indigenous sectors of the industry. The highly connected nature of the industry allows relatively small Irish firms achieve global success quite quickly.”

Irish innovation in life sciences continues

SepTec, winner of the One to Watch Award at Big Ideas 2018, is among the newest wave of innovative applications to emerge from Irish universities.

The SepTec team, based at Dublin City University, developed a revolutionary diagnostic device for sepsis that can provide a diagnosis within minutes – a big improvement on the five hour minimum wait for a diagnosis using current sepsis testing technology. This is potentially life-saving, as for every hour that a patient has sepsis their life expectancy decreases by 8%. SepTec hope to have their device on the market in 2020.

The other medtech solutions presented at Big Ideas 2018 were: 

  • AtriAN Medical – developers of a new treatment for atrial fibrillation
  • Atturos – who have a proteomic-based test that can help prostate cancer patients and their doctors decide whether to operating or not
  • ChemoGel – a thermoresponsive drug-delivery platform for use in treating pancreatic cancer
  • Cortex Analytics – a predictive analytic solution to help more accurately gauge patient perception of value during drug trials
  • itremor – a hand-held concussion-detection device that can diagnose brain injury in seconds
  • Prolego Scientific – who have developed unique algorithms to make better genomic predictions about livestock and crop performance.

While it is not yet clear how many of these projects will pass through full commercialisation, many of Ireland’s universities and institutes of technology have developed spin-out companies that are either thriving or have been acquired by larger entities.

“Some people say that it is a pity if an Irish pharma or medtech spin-out doesn’t go on to become an international player in their own right,” says Dr Ciaran O’Beirne, UCD’s technology transfer manager.

“But in all cases when a spin-out was bought out by a larger partner, the Irish personnel didn’t migrate to the States.  American companies used these acquisitions to set up a presence in Ireland, to take advantage of R&D opportunities here. They have made further investments and created further employment opportunities. It has been a win-win.”

Ireland also boasts a strong services and contract research and manufacturing base; 50% of companies located here are in the business-to-business space. As pressures on healthcare systems have resulted in a greater focus on enhanced efficacy of treatments and cost reduction, there is no sense of complacency across the sector in Ireland, where industry and Government alike are constantly looking for new ways to enhance competitiveness, develop new capabilities and ultimately generate new sustainable growth.

 Learn more about how Enterprise Ireland supports innovation through its dedicated funds and supports.

Female entrepreneurs show leadership credentials as they take it global

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Increasing numbers of women are making the decision to turn great ideas into great businesses.

As aspiring female entrepreneurs find the pathway to success, they are also supporting and inspiring each other along the way, through mentoring and knowledge sharing initiatives such as Going for Growth and ACORNS. This support plays a vital role in fostering entrepreneurship for women in business, from the initial idea through to becoming an internationally trading company.

 

A sprinkling of fairy magic

It was as Ireland was emerging from the depths of the economic crash that Niamh Sherwin Barry turned what had been mostly a bit of fun into one of Ireland’s most iconic and successful toy exporting companies.

The Irish Fairy Door Company has sold more than 750,000 products worldwide but it started as a chat between friends at the kitchen table one evening in 2013.

Co-founder, Niamh says: “We had these little shapes that looked like doors, and we called them fairy doors, myself and my friend Aoife. We were just discussing what our fairies were doing and laughing about it and that got us and our husbands thinking that we could definitely make money out of this.

“Our Local Enterprise Office in South Dublin was just incredible. We got €78,000 in funding and it was totally business changing. We used it for developing the product, the website, and for marketing on social media. We had been sitting around the kitchen table making the doors ourselves but now we were able to take on carpenters to make the doors.

“The LEO also gave us lots of mentoring and support getting us ready to export, they were absolutely brilliant – and it continued when we transitioned to Enterprise Ireland.

“We’ve received €450,00 in funding so far – a third from Enterprise Ireland, a third from the bank and a third from a private investor – but there has also been mentoring and support for trade shows, particularly in the US and Canada, which are big markets for us.”

The Irish Fairy Door Company recently signed a “game-changing” global animation deal to bring the characters from its fairy stories to Wild Brain, a digital network with 50 million subscribers and a portfolio that includes brands such as Fireman Sam, Curious George, Shopkins and Ben 10.

Niamh says: “This product, this little piece of wood takes the child into their own imagination and has the potential and the capacity to stay in that child’s memory forever – and I don’t think there’s that much out there that would have that power.”

Niamh’s journey with the Irish Fairy Door Company has instilled in Niamh a belief that other aspiring female entrepreneurs can also turn their great ideas into great businesses.

“There is nothing stronger than one woman helping another – I really do feel that. The networks for women run by the LEOs and Enterprise Ireland are tremendous for providing support and belief that you can achieve your goals.”

 

Female entrepreneurs build confidence and support

Anne Reilly was a full-time mother and a part-time lecturer in Irish payroll and employment law when, in 2005, she founded her own company providing payroll services and information to local companies in Co Louth.

Going global wasn’t on Anne’s radar until she received a phone call from an Australian company asking if Paycheck Plus could process payroll for their employees in Ireland.

Anne realised that her company had the makings of something much bigger. She says: “I knew that if a company in Australia could find us and trust us to run their payroll here in Ireland, then other companies could too. But I didn’t really know how to go about getting into an international market or even a parochial market at that stage and I didn’t have a whole lot of business acumen in terms of entrepreneurship.

“I was dropping the kids to school one morning and heard that Louth Local Enterprise Office was having an open day and I decided that I would go there. That was a big deal for me, I was very nervous about going in to meet people in an entity like that because I wasn’t sure whether I’d be judged.

“They gave me five sessions with their business mentor, who explained to me how to go about setting and achieving objectives for myself and the business. That had a huge impact on me and gave me a lot of confidence.”

Today, Paycheck Plus has 17 full-time employees providing payroll services in Ireland and the UK for companies from 18 different countries. Last year, the company was named In-Country Payroll Provider of the Year at the Global Payroll Awards.

“I really do believe that without the help of Louth LEO in giving me that confidence and making me feel less alone, that would never have happened. It was a huge gateway into where we ended up going,” Anne says

Anne is now very involved in supporting female entrepreneurship through Going for Growth, an initiative for female entrepreneurs based on shared learning through roundtable sessions hosted by a female lead who has developed a large business. She is also a voluntary leader and special adviser with ACORNS, which promotes female entrepreneurship and job creation in rural Ireland.

“I think many women find it easier to ask other women for help than men do to ask other men for help,” she says. “I also find women very willing to share and that’s hugely instrumental in professional and personal development because the synergy of shared knowledge is so strong.”

 

Going global from Gorey

Vanessa Tierney leveraged 15 years of experience in recruitment for tech companies when she founded the smart-working matching platform Abodoo. It connects companies with remote working professionals globally through an intuitive technology system that also reduces unconscious bias in the hiring process.

Based in the Wexford LEO-supported Hatch Lab in Gorey, Abodoo received a priming grant in October 2017 but moved quickly into Enterprise Ireland’s High Potential Start-up Unit. The company already counts Shopify, Vodafone, and Apple as clients.

Vanessa says: “Abodoo is like a dating website for remote workers. Our system will feed companies and recruitment agencies with great matches but it’s all automated – there’s no human element to Abodoo.

“We’re matching on skills. You don’t know whether the person is male or a female and you don’t know how old they are – just if they have the right soft skills, hard skills, experience, salary expectations, and connectivity. Only after you invite the match into the recruitment process do employers find out if they’re a man or a woman, if they’re 50 or 25.”

Between angel investment and Enterprise Ireland and LEO support, Abodoo has raised more than €800,000 in funding and is currently conducting a first round of venture capital funding to raise between $6 million and $10 million before launching in the US early next year.

Vanessa says, “We’ve had more than 20,000 people and a hundred companies register on Abodoo and we’ve had hundreds of matches. The majority have been in Ireland with about 20% in England. However, there are 212 million skilled people unemployed globally for whom the traditional workplace doesn’t fit their needs. The VC funding is going to allow us to reach those people, get our matchings to a really superior level, and really grow internationally.”

Eliminating bias is a key element of Abodoo’s mission and Vanessa is conscious that there is still some way to go to level the playing field for female entrepreneurs.

“There’s been such an upward trend in support by Enterprise Ireland to female entrepreneurs but if you look at the space that I’m in – tech – representation remains low. I’m not meeting many women, and just 3% of venture capital money globally goes to female entrepreneurs.”

Enterprise Ireland is working with the LEOs to develop a new strategy for female entrepreneurship, which will address some of these issues. Sheelagh Daly, Entrepreneurship Manager (Regions) for Enterprise Ireland, believes that the strong links between the two organisations and an understanding of the vital role both play will be key to doing so successfully.

“There are still areas which pose more challenges for women who are setting up businesses,” says Daly, who is a former chair of the Network of Local Enterprise Offices and was the driving force behind the inaugural National Women’s Enterprise Day in 2007. “The new strategy will be focusing on confidence building, capability building, networking, and access to finance.”

For Vanessa, it is vital that women continue to support, learn, and drive each other forward.

“Women thrive when we can connect with another woman who’s been there done it,” she says. “I proactively reached out to successful Irish women who have gone global, and they have been phenomenally supportive and that is what has given me the confidence to go for it.”

Relationship building key for Irish medtech suppliers breaking into the US

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While Ireland’s reputation for health innovation is admired across the world, breaking into new markets is rarely easy. The US hospital supply chain is one of the most potentially lucrative for Irish companies but also one of the most difficult for outsiders to penetrate.

Earlier this year, Enterprise Ireland’s life sciences team hosted Navigating the US Hospital Supply Chain, aiming to help Irish exporters to become more familiar with the intricacies of the sector and increase their chances of securing wins.

One of the day’s most persistent themes was the need within the US hospital supply chain for suppliers that adopt a collaborative approach.

David Walsh, Director of Supply Chain Administration at Boston’s Children Hospital, was a key speaker at the event. In his presentation and the panel discussion that followed, he returned repeatedly to the subject of open collaboration.

“We’re a team. We all work together. We want to work with you if there’s a benefit on both sides,” he told an audience of medtech professionals. “We can learn from you and you can learn from us.”

Relationship-building a key competitive advantage for Irish medtech suppliers

The reputation Irish suppliers have developed for relationship-building is a key competitive advantage that serves this need well. Meditec Medical has applied the approach over the course of its relationship with Boston Children’s Hospital, thanks to an introduction facilitated by Enterprise Ireland.

Alan Sullivan, Managing Director of Meditec, advised exporters, “Before going into the US market, you need to be ready.

“We got our product tested on the east coast of America for compliance with fire regulation. Because we were already looking for our FDA approval, we had these wheels in motion.”

Building successful business relationships requires consistent contact. While technology can bridge geographic gaps in day-to-day communications, a lasting partnership requires frequent presence in the US, including availability for stakeholder meetings. Working with a supplier located on a different continent may be considered less favourably than local options, so perceptions of risk must be mitigated in the eyes of the buyer.

Walsh advised on the importance of presenting your ability to deal with the inevitable issues experienced during trials and roll-outs, remotely. Exporters should be prepared to answer the question: “It’s a good quality product, but what if we have problems?”

Irish medtech businesses can’t afford to ignore the open invitation to dialogue when entering the US market but it can be intimidating for those who are new to it.

Unlike the relatively centralised system familiar in Ireland, purchasing decisions in the US are made either by large hospitals and networks, or by group purchasing organisations (GPOs) comprised of several smaller hospitals and health centres that pool resources in order to gain more clout in the market.

Charlie Miceli, VP Network Chief Supply Chain Officer at the University of Vermont Health Network, explained, “Getting in at group level can reap huge rewards. There are six hospitals in the University of Vermont Health Network.”

From an outsider’s perspective, it can also make for a confusing landscape, however, with the question of where to go, and who to speak to at the first point of contact, challenging for new entrants.

In what can already be a long sales cycle, getting in with the right person at the right stage is crucial. The best way to avoid spending time on what supply chain calls the ‘circular wheel’ is to ask the question of how to engage.

“Try to understand what the roles are,” said Dave. “Ask the question and we’ll help you to find right person to talk to at the right stage.”

Enterprise Ireland can also help with the process. In the Boston office, we have successfully connected a number of Irish medtech suppliers with key stakeholders in the US hospital supply chain. We encourage the companies we support to reach out and see how we can assist with their approach.

This article was originally published in the Sunday Independent.

Why Portwest views the Eurozone as its local market

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Once a small family business in Mayo, Portwest has become the world’s fastest growing work wear company. Here’s how.

The saying, ‘don’t let perfect be the enemy of good’ means that if you wait for everything to be perfect, you’ll never progress. For businesses, the maxim could well be adapted to ‘don’t let success in the home market be the enemy of export growth’.

It was an issue touched on by Harry Hughes, CEO of Mayo-based safety clothing and equipment company Portwest. He was speaking at Competing for the Future, a breakfast briefing panel discussion organised by Enterprise Ireland as part of International Markets Week.

During the discussion, Hughes suggested to a packed auditorium in the RDS that success in the home market can inadvertently stymie ambition overseas.

“When you go abroad to foreign markets, you are starting at ground zero, which is not an easy place to be,” said Hughes.

It takes a successful business out of its comfort zone. “It just takes time and you have to stay with it,” he said.

Hughes, who is the current EY Entrepreneur of the Year, helped grow what was a small family business with a turnover of €100,000 in 1978 into the €205 million a year business employing 3000 staff it is today.

 

How Portwest broke Europe

The UK was Portwest’s first export market and remains an important one for the company today, accounting for 40% of its business. Its success there may, however, have discouraged it from entering new markets.

“We were probably slow learners in the beginning, in that we were 25 years selling in Britain and had reached maturity in that market before, 15 years ago, we started looking into Europe,” said Hughes.

It has taken a “one step at a time” approach to new markets ever since, starting with the Netherlands and then France. Today, Portwest sells into 120 countries worldwide.

“We started in the Dutch market and after that it was one brick at a time in Europe. We now have sales people in every country in Europe. We have eight people in Germany which we have found to be the most difficult to crack but obviously the prize is the biggest, at 82 million people.”

Every country has its own nuances, he said, and it’s important to understand the competition in each. “In our case, we would have 50 competitors right across Europe. Nobody is standing at doors waiting for us. But if you are persistent, you will get there in the end.”

The key is to innovate, he said. “We have to look at the local styling. The Germans expect a better product for a lower price, so we’ve had to adapt to that. There is no reason why any Irish company cannot succeed as long as they keep saying ‘What are the issues?’ and keep resolving them.”

Mistakes are inevitable. In Portwest’s case, a key hire made in Ireland and relocated to Europe turned out not to be the best strategy. “Now we employ French people in France, Germans in Germany and so on. The boots on the ground need to be local,” said Hughes.

Today the company, which sells globally, views the Eurozone as its local market. “We have the same currency, the same laws, there are no borders.”

Brexit uncertainties make looking further than the UK more important than ever. Portwest has responded to the UK’s imminent departure from the EU by shifting some of its warehouse activities.

“There are only two things we give away – warehousing and sales. Everything else we do in Mayo,” he said.

The company recently acquired 140,000 sq ft of warehousing in Poland, reducing its warehousing space in Britain. “We take the attitude of ‘plan for the worst’,” said Hughes. “So rather than have one major distribution centre servicing the EU we will have two.”

Regardless of the ultimate outcome of Brexit, such a move makes good business sense, he said. “We’ve been growing at around 25% a year and currently have nine international warehouses, but from a Brexit point of view, we only had one distribution centre in Europe, so that will now go to two.”

Language and culture are not barriers so much as issues to be resolved, he said. “You need to see (the Eurozone) as a local market and get out there and invest,” he said. “Sales are going to cost you initially but once you make that initial investment, once you get a taste for selling into one country in Europe, you’ll find it as easy as selling in Ireland – and then you will keep going.”

Burgeoning middle class in China creates opportunities along New Silk Road

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“Made in China” are three words that became ubiquitous in global manufacturing. Being a factory for the world powered China’s economic rise over the past four decades to become the New Silk Road.

The most populous nation on earth has gone from producing less than 3% of global manufacturing output by value in 1990 to almost a quarter last year. Companies large and small throughout the world have products that are made in China, including 80% of the world’s air-conditioners, 70% of its mobile phones, and 60% of its shoes.

 

How China became the ‘New Silk Road’

Exporting is key to China’s success but it has also transformed the domestic economy into one that is increasingly consumer-led.

More than 400 million of China’s 1.4 billion population are now considered middle class. Consumer spending accounts for more than 60% of economic growth in China and, according to a study by consulting firm McKinsey, 76% of China’s urban population will be considered middle class by 2022, compared to just 4% in 2000.

Dr. Linda Yueh, a fellow in economics at Oxford University, where she directs the China Growth Centre, says that this burgeoning middle class presents huge opportunities for Irish exporters seeking to sell into what is forecast to become the world’s largest economy as early as 2020.

“China is now a maturing economy and has reached the stage where future growth is going to rely on domestic demand,” Dr. Yueh says. “The cities are already full of rich people and therein lie opportunities for Irish exporters, particularly given that many local companies there haven’t yet faced global competition.

“You can be a massive firm in China and never have faced global competition because in China you have a domestic market of 1.4 billion people.”

The 1980s is when China began to reform and to upgrade its industries, moving out of central planning and becoming more market oriented. This ‘open doors’ policy towards global trade transformed the country and it continues to advance today in the form of the ‘New Silk Road’ routes of the Chinese government’s Belt and Road Initiative (BRI).

The BRI development strategy involves infrastructure development and investments that will connect cities across 68 countries and including 65% of the world’s population across Asia, Europe and Africa. The plan is to open trade corridors and develop a unified market which creates jobs and opportunities for people and businesses along the routes. Crucially for Irish exporters, it will make it easier for businesses to reach China’s growing middle classes.

 

Irish ambition in China

An increasing number of Irish companies partnering with Enterprise Ireland have set their sights on taking advantage of this vast and rapidly expanding market.

In 2017, Enterprise Ireland client exports to Greater China grew by 9.7% to record levels of €1.03 billion, with China now accounting for 52% of client exports to the Asia Pacific region. Enterprise Ireland has set ambitious targets to grow exports to Greater China by 40% to €1.44 billion by 2020.

Dr. Yueh says that demand for high-quality innovative, imported products will continue to grow strongly in China for the foreseeable future.

“A third of the world lived in abject poverty in 1990. Today we are at a historic point, where just one in 10 live in extreme poverty. More than one billion people have been lifted out of poverty since 1990 and most of that is due to China,” she says.

“Hundreds of millions of people have entered the middle class and on current growth rates the projections are that in a couple of years, we’ll have 3.2 billion people who are middle class around the world. That’s somebody earning between $10-$100 dollars per day.

“By 2030, and this point may be hit even sooner given how strong emerging economies growth is, especially in Asia, for the first time ever more than half of the world will be middle class – 4.9 billion out of an estimated 8.5 billion people at that point.

“At the moment, more than half of the middle class are in the West but by 2030, two-thirds of the middle class will be in Asia.

“This means there will be a huge amount of opportunities that we haven’t seen before. The United States powered the world economy following World War II in terms of growth with about a quarter of a million people. With Asia, we are talking about five billion people who are going to be middle class. Some of these countries, including China, may not become rich on average but the changes this is bringing into the world economy are significant.

“We’re all going to be impacted by these tremendous opportunities as a new global middle class in China and indeed the rest of Asia.”

 

Contact Enterprise Ireland’s local office for information and support about identifying and developing market opportunities in China.

Ambition Benelux

Ambition Benelux: Big data, big opportunity

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They say every cloud has a silver lining. And in Benelux, there is a very large cloud, and, for the right business, not only a silver lining but a golden opportunity: cloud computing and big data.

 

Already one of the physical gateways to Europe – through Amsterdam, one of the most advanced and busiest ports in the world – the Benelux region is positioning itself as one of Europe’s biggest virtual gateways – thanks to the breakneck rise of the global digital economy.

The figures are truly astonishing and show the transformative nature of the growth of big data. It is estimated that 90% of the world’s data was created in just the last two years alone.

By 2021, according to Stijn Grove, managing director of the Dutch Data Center Association, the digital economy will account for more than half of Holland’s GDP.

“Everything that happens online goes through a data centre,” said Grove. “We are fast approaching what some are calling ‘a data singularity’ with the advances in machine learning, AI, the Internet of Things and self-driving cars. The demand for low latency data centres to handle this is huge.”

“All of this is interconnected and delivers on the digital economy,” Grove told firms attending the Ambition Benelux event at Enterprise Ireland’s Dublin offices. “For example, if you want to hop in an Uber, it requires the traffic information, the weather, the locations of drivers and it is provided to Uber in a split second, so they can combine it and display the relevant information to the customer.

“And this is replicated in any online app or digital product or website. This happens in the background and has led to big hubs springing up in the world to accommodate it.”

 

Why Benelux has become a data centre hub

The Netherlands has been quick to adapt to the new digital landscape and is one of the top five data centre hubs in Europe. It is already home to some of the biggest data handlers in the world, housing data centres for the likes of Google and Microsoft, and has averaged 18% YoY growth in data centre provision for the past seven years.

Currently, the main data centre provision is in Amsterdam itself, accounting for 215,000 sq.m of the total 308,000 sq.m of data floor space. Others are regional centres around the country and two hyperscale centres. Together they account for 1,300 megawatts of power use.

The trend shows no sign of slowing. Currently 20% of all foreign direct investment in the Netherlands is in data centre-related sectors. That is forecast to rise to 25%, said Grove.

In 2017, Equinix built the €200 million AMS4 data centre in Amsterdam, housing almost €1 billion in IT equipment but the recent Ambition Benelux event at Enterprise Ireland’s Dublin headquarters was told it would be filled with data within the next two years.

 

Opportunities for Irish construction companies

 It should alert Irish firms in construction, IT and project management. There is now high demand in all of these areas, as demand outstrips supply in the local market. According to Grove, the shortage in expertise and skilled personnel is also experiencing a double-down effect as Dutch firms, employers and other bodies look to Brexit-proof their long-term infrastructure plans by sourcing alternatives to UK suppliers.

This should provide the ideal impetus for firms looking to diversify their export-side, said Richard Engelkes, Enterprise Ireland’s Senior Market Advisor in Construction Products and Services to the Benelux region.

“Currently, 35% of our exports go to the UK and 59% of this is in construction. What we have in the Benelux region is a fast-growing market and, in particular, with cleantech, pharma and data centre construction, there is a demand for the expertise of Irish firms. Irish expertise in these areas is highly respected and highly sought after. They have an international reputation in building and delivering difficult and complex structures,” says Engelkes.

In acting as a digital gateway to Europe, there are also challenges, not least in powering the data centres themselves. The energy footprint of the data centres sits at 1,300 MW. By comparison, Amsterdam the city needs 400 MW to function.

“There is no country in the world that built its power grid to foresee and meet these challenges,” says Grove. But these challenges also raise opportunities for Irish firms specialising in power and renewables solutions.

Grove added: “The market is good, demand is big. We have a need for good personnel and services and the companies here are looking for long-term contracts and partners to bring certainty to the growth. Companies here can see it is accelerating and they are looking for at least certainty in their supply chain. With Brexit, we are seeing firms preparing for non-UK suppliers and this puts Irish counterparts in a great position.”

Irish firms looking to take advantage of opportunities should think about Dutch partners, says Grove. As Dutch construction firms move into the data centre build sector, they need good services, contractors and expertise.

“It is already known that Irish firms have the expertise, the Irish advantage,” said Engelkes.

Thanks to that positive sentiment, Irish firms will find that the door to this market is already open.

 

Learn more on how Enterprise Ireland can support your business to export to new markets.

Future Transport

Ireland: the go-to destination for future transport

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Transport is changing and Ireland’s automotive suppliers are in the driving seat. Companies that think globally, invest in the growth of their companies and innovate continuously are most likely to succeed, particularly in the fast-changing automotive and mobility space.

Irish companies are doing all three, delegates at Connected Autonomous Vehicles and Mobility heard recently.

Organised by Enterprise Ireland, the event brought leaders from the global automotive industry to Dublin. These included Kelly Kay, Executive Vice President of the Toyota Research Institute; Rahul Vijay, tech deal-maker at Uber, and Amer Akhtar, managing partner at Foothill Ventures and an advisor to Chinese electric vehicle (EV) company NIO.

Their audience included top Irish automotive and mobility engineering companies, including CitySwifter, which uses big data and predictive analytics to optimise bus networks; Cubic Telecom, a global connectivity specialist for the automotive sector, and micro-location semiconductor solutions developer Decawave.

Taoglas, a developer of antenna solutions; iCabbi, a dispatch specialist and Fleet, Ireland’s first peer-to-peer car hire platform, were represented too.

Key executives from vehicle tracking and fleet management company Transpoco; Xtract, a developer of a unique software solution for the auto-insurance and OEM after-sales markets, and satellite communications solutions Arralis, a maker of smart antennae, were also present.

The attendee list alone demonstrated the breadth of capacity that already exists in the transport space, including AdaptiveMobile, a world leader in mobile network security protecting 2.1 billion subscribers worldwide.

It also included Arup, who helps transport authorities and city planners to optimise transport networks, as well as connected transport IoT solutions provider Davra Networks. The event attracted both innovative start-ups and established manufacturers such as Combilift, whose materials handling solutions are used worldwide.

 

Commited to innovation

What all have in common is an adherence to the three key indicators of sustained success – a determination to internationalise, to invest in the growth of their company, and a constant commitment to innovation –  said Tom Kelly, head of innovation and competitiveness at Enterprise Ireland.

“The people in this room, all of them, meet those objectives. They are businesses for whom innovation is the critical component of their thinking, and that is the best recipe for success,” he said.

Their commitment to these three pillars – internationalise, invest, innovate – is what drives all Enterprise Ireland-supported companies to success. “Over the last seven years you can see confident, upward progress in terms of the key metrics we look at, in terms of the sales output of our companies,” he said.

This includes exports of more than €22 billion by companies supported by Enterprise Ireland, a figure on track to hit €26 billion by the end of 2020, he said.

The automotive sector has a particular resonance here, Kelly noted, with Ford having been one of the country’s biggest employers, in addition to the influence of the presence of a number of UK subsidiaries up until the 1980s.

“But we have a greater history too, in the importance of our subsuppliers who today do business all over the world, with all of the leading automotive sector companies,” he said.

“The Nissans, the Volvos, the Jaguar Landrovers, the Fords, the Bentleys, the McLarens, the Nascars, the Teslas – they are all there, all companies doing business with Irish companies. This isn’t something that stands still either, with Irish companies simply supplying a part. Our companies are continuing to evolve, to change and respond to the needs of those companies.”

“It’s a fact that comes back to the investments they make, to the capability they are putting into their company, to the capacity they build and the innovation they commit to. That is characteristic of the companies sitting here today and it is a guarantor of their future success and of their future relevance to their customers.”

 

Transport is changing fast

The automotive world is changing fast, with the machine element becoming less complex but the electronics and software components infinitely more so. It’s a development to which Ireland is well placed to contribute.

“What we have in Ireland are companies that have been supplying more traditional component parts and also the emergence of companies that are providing the kind of sensor technology and software that enables autonomous operation of vehicles,” said Kelly.

Companies supported by Enterprise Ireland currently export some €130 million direct to the automotive sector, and another €30 million through automotive software applications. “So we have significant scale of activity already, a platform to build on that gives us confidence as we go forward.”

A major part of Enterprise Ireland’s role is to drive the innovation agenda, to support companies with grant assistance and incentivise them to do more on this front and to take on greater challenges, he said. “But probably the most understated and single most important thing we can do is make connections, whether in the marketplace with suppliers and customers, or with companies.”

Building connectivity, partnerships and long-term alliances yields success, he said, a fact Enterprise Ireland is facilitating through the creation of an industry cluster around the vehicles of the future. “It is very much about recognising that the vehicle of the future is going to be connected, autonomous and shared and electric, it will have all of those attributes, and there is still going to be a traditional element too.”

Enterprise Ireland’s aim is for Ireland to be the “go-to” place for the supply of components and technologies of relevance to the future automotive sector, he said. The launch of the €500 million Disruptive Technologies Innovation Fund is a clear indication of the Irish government’s commitment to realising this ambition.

“The people in this room come from different areas, with deep levels of knowledge in sensor technology sitting beside traditional components suppliers, engineering companies and software expertise. It’s a clear expression of the capability that exists in this country.”

 

RD&I support takes SeaQuest Systems around the world

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Investment in research, development and innovation opened up a valuable new market for second generation marine equipment specialist SeaQuest Systems.

Based in Killybegs in County Donegal, SeaQuest Systems was founded by Bert Leslie, current managing director in 1986, serving local and national fishing fleet. Brian Leslie joined the company twenty years ago, after graduating from Dublin Institute of Technology with a degree in mechanical engineering.

Since then, the company has become a leader in the design and manufacture of pumps and hydraulic systems for fishing and offshore vessels. Its products are prized for the excellence of their design, sturdy construction and superior performance.

The company’s strong reputation in the fishing sector led to an unexpected call from a company in an entirely new industry for SeaQuest Systems – aquaculture.

“One day we got a call out of the blue from an aquaculture company in Norway, to ask if we could design and build a pump to move salmon,” explains Brian.

The Norwegian company was searching for a solution to a recurring problem with farmed salmon – sea lice. With lice a naturally occurring parasite in wild salmon, nature’s remedy is simple – when salmon swim back upstream to their spawning grounds, the freshwater kills salt-loving lice.

As farmed salmon don’t make that trip, sea lice numbers proliferate in the confines of seawater cages.

 

Innovating a sustainable solution

“Freshwater kills off sea lice but, in this instance, it’s not a sustainable solution,” says Leslie.  “Similarly, the traditional way to manage the problem, through the use of antibiotics, is not a long-term solution because anything treated that way becomes resistant to it. Of course, consumers don’t want to think about antibiotics ending up in their food either, so there has been a move away from that approach for a number of years.”

With transferring salmon into slightly warmer seawater being shown to work, the Norwegian company wanted to know if SeaQuest could engineer a pump to do just that. “I told them I didn’t see why it wouldn’t work,” says Leslie.

“My feeling was that we’d give it a good go. Either way, it would be the cheapest R&D we’d ever do. If it worked we’d have a new customer and it was a good way to check out a whole new market.”

Aquaculture, or farmed fish, is a growth industry. “Ultimately it is going to be bigger than fishing as a sustainable way of feeding people,” says Leslie.

But only if it solves the problem of sea lice.

SeaQuest set to work designing, manufacturing and testing a pump that could safely transport the salmon from cold to warmer water and back. Getting the solution right was painstaking.

“Our earliest attempts didn’t work but it was only when we installed windows into the test pump that we could see why. What was happening was that the smaller fish would go with the flow but the bigger ones would swim against the current. It comes naturally to a salmon to do that but they were getting bruised and stressed, and in some cases dying. In the end, we could see that rather than adapt one of our own pumps, we needed to design an entirely new solution, something that would be completely stress-free for the salmon.”

SeaQuest was already renowned as one of the best makers in the world of pumps for pelagic fishing. “That’s why the Norwegian company came to us with its problem. Their problem piqued our interest, ultimately opening the door to an entirely new sector for us.

“Once we got a feel for the potential opportunity – given the size of the aquaculture market – we reckoned we needed to invest around €360,000 to take advantage of it.”

 

Using R&D funding to target commercial opportunities

The company made a successful application to Enterprise Ireland for R&D project funding. “One of the things we stressed in our application was the time-sensitive nature of the R&D project. We needed it to be ready in time for Aqua Nor in August 2017. That is the world’s biggest aqua culture trade fair and takes place biennially, but we also needed the pump to be fully tested before the show.”

Not alone did they achieve both goals but such was the pump’s success in use that it sparked enormous interest at Aqua Nor. So satisfied was the Norwegian customer that it acquired worldwide distribution rights for the pump from SeaQuest.

“It’s an arrangement that suits us perfectly, as it will bring our brand around the world, without requiring a major sales input for us.”

The success of the R&D project has helped grow the business, which employs 60 people. “We are now expanding our facilities again, just three years after having already extended. It’s happening sooner than we had expected to due to demand driven by that R&D project, we will be investing approximately €3.5 million in this new expansion and will expand our workforce.

“Focusing on Norway was hugely helpful because Norway is the biggest aquaculture country in the world. What it does in aquaculture, the rest of the world follows.”

 

The importance of innovation

The Enterprise Ireland RD&I grant application process was straightforward. SeaQuest is also applying for a patent for the pump, and hopes to avail of the lower tax rate applicable under the Revenue’s Knowledge Development Box initiative. Much of the content used in its Enterprise Ireland application will be suitable for Revenue, streamlining the process, Leslie comments.

The timing of the new intellectual property couldn’t be better either, as a patent currently of value to SeaQuest heads towards its end of life.

 “Innovation is key for us because we don’t want to compete on price,” he says.

But while Brian has been an innovator ever since he designed and built his first fish pump while still at college, until now he never viewed SeaQuest’s innovations as research and development.

“We never thought of that work as R&D. We are all about innovating, in so far as clients have a need, we build a solution. We’re always trying to make our clients’ job easier, that’s just what we do. To me, R&D was always something I associated with paperwork.”

The impact of the innovation support SeaQuest received from Enterprise Ireland rectified this misperception. RD&I is now something that Leslie expects SeaQuest to do a lot more of.

“Because Ireland is never going to be the cheapest place to do something, we have to do it better, we have to innovate.”

For more information on how Enterprise Ireland supports R&D visit our innovation supports.

On demand dispatch delivers success for WeBringg

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When Alan Hickey forgot his wife’s birthday, it seemed like a disaster. In fact, it turned out to be a very good thing indeed. It gave him the idea for WeBringg, an on-demand crowdsourced delivery service.

 

Hickey set up the business with co-founder Sean Murray after a discussion about whether or not a delivery company already existed that could save the day by allowing him to buy a present online and have it delivered immediately.

Not possible, said Murray. Why not? said Hickey, in what proved to be their eureka moment.

 

WeBringg connects retailers and consumers

Hickey was a financial broker, while Murray’s background was in app development. While still employed in their day jobs, both worked nights and weekends to develop a crowdbased delivery platform to connect retailers and consumers.

WeBrinng co-founders

Martin Daly, LEO Fingal with WeBringg co-founders, Alan Hickey and Sean Murray

They launched in 2016, doing deliveries for local retailers themselves before landing a partnering deal with restaurant delivery operator Just Eat.

To support its growth, Local Enterprise Office Fingal referred WeBringg to Enterprise Ireland, who identified it as a High Potential Start Up. With its support, the company raised seed funding of €850,000.

What appealed to investors was its compelling offering. “If you wanted to be the largest logistics delivery business in the world, you would need billions of euro. The other way is to build and sell robust scalable software to any retailer in the world,” said Hickey.

“Rather than provide either an off the shelf delivery service, or an off the shelf software as a service (SaaS) product, we wanted to really partner with retailers.”

Providing dispatch software, operator services and consultancy allows it to differentiate itself in the markets it operates in.

 

Simplifying logistics for retailers

“We totally ‘get’ dispatch because we are a hybrid model spanning every vertical, through to last mile delivery, which we can do direct or through third-party delivery partners. And we help large-scale retailers, who have thousands of vans on the road, to optimise their existing fleet.”

It wins its business by understanding that retailers are expert at marketing and selling products, but not at logistics or last mile delivery. “So let us be that expert,” he said. “Last mile delivery is a totally new area of logistics. We have an opportunity to set the global standard for it.”

Today WeBringg operates in the UK, Spain, Australia and New Zealand and has a team of 38 staff, and more than 1000 independent drivers worldwide.

It has an annual run rate of €5 million a year and three revenue streams – providing crowd sourced deliveries directly to consumers, including for Just Eat; partnering with retailers such as Musgrave to provide dispatch technology; and providing data driven consultancy services to the retail and delivery sectors.

 

Working with Enterprise Ireland to go global

Working with Enterprise Ireland also helped WeBringg to develop its board, which it did by taking on experienced non-executive directors. “If we wanted to be a big global company, we had to start thinking like one,” he said.

While the UK was the business’s obvious first choice for exports, the Brexit vote provided an unexpected challenge. “With Brexit, we needed another market to expand into. Lots of companies go the Eurozone route but for language and cultural reasons, we decided there were more opportunities for us in Australia and New Zealand.”

Funding assistance for market research trips helped, including participation on an Enterprise Ireland trade mission to Australia. Being part of a high-level governmental trade delegation proved invaluable.

“We were able to take the CEO of Menulog out to dinner at the Sydney Opera House,” he said.

 “A dinner is just a dinner, but when you are introducing people to your Minister for Trade and Enterprise and the President of Ireland, that’s worth so much more.”

 

Partnering with the largest food ordering platform in Australia

WeBringg subsequently signed a partnership deal with Menulog, the largest food ordering platform in Australia, and opened an office in Brisbane.

In June 2018, it acquired Spatula, a spin-out of the University of Western Australia. “We knew we needed to take the software global and that we had gaps in our technology. These guys had unbelievable dispatch software but were not commercial,” he said.

Spatula has helped bring seamless real-time tracking for customers, enabling WeBringg to perfect its infrastructure as it grows, accelerates and expands worldwide. “It’s now our entire tech team, all our development comes from there,” he said.

WeBringg has continued growing in the UK market too, recently setting up a UK subsidiary in Scotland, to help mitigate the risk from Brexit. “If there is a hard Brexit we can transfer all the trade into that subsidiary.”

All along the way the company has benefited from a variety of Enterprise Ireland and Local Enterprise Office supports, with mentoring, funding, guidance and advice. Murray participated on a CEOs’ retreat too and that kind of networking is invaluable too, said Hickey, “because, if you haven’t experienced something, you can be sure someone else has.”

 

Irish companies build on UK construction success

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Donal Byrne, a senior development adviser for the construction industry at Enterprise Ireland, explains why Irish exporters in the sector are winning business in the UK.

There are high-potential opportunities for Irish exporters in the UK construction sector notwithstanding challenges posed by Brexit. Global Irish construction industry services and goods exports were valued at €1.7 billion in 2016, while the number of people employed by firms supported by Enterprise Ireland is projected to increase from 33,000 last year to 40,000 by 2020. For the offsite construction subsector, the UK accounts for the vast majority of Irish exports.

A harsh winter, rainy spring, and the collapse of Carillion in January, with write downs on bad loans estimated to have exceeded £1 billion, put a dampener on UK construction activity in the first quarter of the year. Analysts are nonetheless predicting a ‘hockey stick’ progression for the sector in 2018, similar to that experienced in 2017.

A seminar, organised by Enterprise Ireland in conjunction with the Irish Precast Concrete Association (IPCA), heard that the chief source of this optimism is the British government’s commitment to a £650 billion pipeline of construction projects. While market volatility may well cause a periodic dip in sales for distinct sectors and individual companies, overall demand in UK construction remains strong.

 

Opportunities in UK construction

Simon Rawlinson, Partner and Head of Strategic Research and Insight with Arcadis Design and Consultancy, and a member of the UK’s Construction Leadership Council, told the seminar that he sees opportunities for Irish construction industry companies in a range of areas, particularly in energy, waste, transport, telecommunications, and social housing and urban regeneration. 

The scheme with most potential is the HS2 high-speed rail link, with £55.7 billion budgeted for phases 1 and 2 of the project.

The British housing market is buoyant, noted Rawlinson, especially in regions outside London, notably Manchester and the Midlands.

A short-term skills shortage forecast for the UK industry can also benefit Irish offsite construction companies. The UK faces capacity issues due to significant remedial works required nationwide as a result of projects put on hold by the Carillion collapse resuming in catch-up mode. Brexit is also a factor, with many European workers leaving the UK.

There are particularly strong opportunities for building sector companies who are skilled in the use of digital design and building information modelling (BIM). There is also a new emphasis on optimising long-term product performance, using smart technology and the internet of things. In housing, offsite manufacturing and modular building are growth areas. 

  

How Enterprise Ireland supports construction industry exporters

Enterprise Ireland supports construction industry exporters in three key ways. We assist companies to improve existing products and to develop new solutions that meet market needs and deliver added value. We run programmes that help to develop a corporate culture of continuous improvement to increase productivity and reduce environmental impact and we run programmes focused on improving, and broadening, the capabilities of leadership teams.

We also run Brexit Advisory Clinics for exporters and provide eligible companies with grants of up to €5,000 to help them mitigate risks of potential impacts.

Even a soft Brexit may create new obstacles to navigate. For example, if Britain remains in the European Customs Union, additional paperwork will still be required of exporters at UK border crossings. Using a freight forwarding company and a customs brokerage can reduce logistical headaches but additional management time must still be set aside to instruct third parties.

Because border hold-ups will be more likely post-Brexit, exporters will need to factor in higher costs for delays in estimated delivery times. In the construction industry, where ‘just-in-time’ delivery is a feature of many supplier contracts, it may be necessary for exporters to invest in UK-based depots to hold goods temporarily before a specified delivery date. One option discussed at the seminar suggested that exporters could invest in joint warehousing facilities to reduce the cost burden on individual companies.

Brexit is a new obstacle to trade but is not insurmountable. Specialist expertise and high-quality products that address real needs will always find a market.

This article was originally published in the Sunday Independent.

PM Group and Diversification Success

After recession drove PM Group to look further afield, it didn’t look back

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PM Group is an Irish headquartered, international project delivery company, operating in Europe, the USA, and Asia. The company has a 45-year track record in project management, process design, facility design, and construction management for leading multinational companies.

A decade ago, things looked a little different, business development manager John Brophy told delegates at Competing for the Future, a panel discussion which took place at the RDS in Dublin as part Enterprise Ireland’s International Markets Week.

In 2007, the recession left PM Group faced with a diminishing home market. At the time, it had offices in Ireland, the UK, Russia and Poland, but the majority of its work was Irish based and, therefore, highly exposed to the construction downturn here.

 

PM Group expands to mainland Europe

“In order to diversify, we had to look out and mainland Europe was a very accessible market,” said Brophy. “We focused initially on Belgium, which was a massive market for many of our customers. We went out on a project by project basis with our customers.”

It opened an office in Brussels and has continued to grow there right up to today. Earlier this year, it acquired a company in Belgium which it has brought into PM Group.

“That gives us a greater presence. Most of our customers don’t want a single project, they are looking for continuity of relationship. So you need to be on the ground. You need to have people who can speak the language and you need to be able to service them time and again.”

Establishing partnerships with locally based companies has been an important part of its export strategy over the past 11 years, helping to guide it through language barriers, differing tax, visa, planning, permitting and other regulatory rules.

 

Forming strong local partnerships

“As an Irish company, we have found that we are quite good at partnerships, and if you form partnerships and alliances with local companies, you share your workload but they also help you to deliver and be successful for your clients,” said Brophy.

“You can’t go in and disrupt a market and say ‘We’re the best’. You need to work in partnership and understand how things are done. They are never done exactly as they are at home and you’ve got to learn very fast throughout a project. Local partners help with that.”

In recent years, PM Group has been taking action to mitigate the risk of Brexit.  The UK has already seen a slowdown in business investment since the Brexit vote, he said. “We work in capital projects, so it tends to be at the forefront of what people are deciding strategically for their business.”

Rather than diminish its footprint in the UK however, PM Group has responded to Brexit by growing its UK presence, acquiring a company there and adding two new offices, in Manchester and Edinburgh, “Because no matter what, the UK is a big country and you need to have a regional presence,” he said.

 

Diversification strategy

The Group has also diversified sectorally, including into chemical and petro chemical sectors, which the recent acquisition will help it service, he said. “So we have widened what we can do.”

Its UK acquisition is also helping it with its overall talent pool needs, creating a fresh and valuable new pipeline that can be fed through to the rest of the organisation.

Not every decision in relation to exports strategy will be correct, he said. PM Group moved into some markets, such as Russia and the Middle East, from which it subsequently departed. “By and large though, where we chose to go was good,” he said.

Any overseas expansion comes at a cost however. “It took a huge stretch on the management team. We sell a service, so the important thing for our customers is that the service they get around the world matches the service they get here, so we had to put people in the field. Finding the people was a challenge. We now have a local manager in China, Belgium and Poland, and that’s where we have got to in terms of maturity.”

Finding staff is only ever the start, it’s finding customers that counts. “It’s hard,” said Brophy. “You really have to find a way to differentiate yourself from the competition. You can’t go in there and say ‘We’re here, isn’t that good enough?’”

Today, PM Group has 17 offices around the world and works in high-tech sectors such as pharmaceuticals, medical devices, data centres, and food. All through this overseas expansion, investing in innovation has enabled PM Group to differentiate itself, as has its ongoing commitment to staff training.

“We have a lot of subject matter experts now. You have to be the best. You have to be someone who is sought after because price isn’t the only factor. It’s about being sought after and being able to offer a service that maybe they can’t find locally.”

Learn how Enterprise Ireland supports business to diversify with the Market Discovery Fund.