GUANGZHOU, CHINA — Ivo Lansbergen likes to think about the philosophical element behind what he calls the “phenomenal speed” in the Asia market.
As president of DSM Engineering Plastics Asia Pacific, he sees the once dominant paradigm of Western suppliers serving Western customers changing. But more importantly, he understands what sets Chinese customers apart.
In an interview at Chinaplas 2015 in Guangzhou, he used Xiaomi Technology Co. Ltd. as an example. Xiaomi is the world's third largest smartphone brand and the second largest wearable maker, sometimes referred to “China's Apple.”
Xiaomi uses DSM's Stanyl ForTii material for antenna splitters on the latest Mi4 smartphone.
“I can tell you the demands we get from Xiaomi are slightly different. They are in a different league in terms of speeds,” he said.
“The question is, can a Western company comply with the speed demanded by Chinese local companies?” he said, emphasizing the importance of having local R&D capabilities.
“My argument would be that a global player like DSM is also set out as a local player in China. … If you are keeping all your trade secrets and all your core development in Europe or in Americas, I think you are going to have a very hard time.”
But why are the Chinese customers moving so fast and demanding such high speeds?
“Because Chinese companies need to catch up,” said Li Xuedai, business director Greater China of DSM Engineering Plastics. “The Chinese economy and companies started low and need a higher speed to catch up with global standards.
“Some people misunderstand that Chinese customers have low quality request,” he added, “Actually Chinese customers have very high request on quality.”
The cutthroat competition in the Chinese market forces manufacturers to raise the bar, he explained.
“China is one of the most competitive markets. Everybody is here. Like automotive, all brands are here. If you go to Europe, or the U.S., you cannot see all global brands. But in China, because it's an emerging market and offers so many opportunities, everyone wants to get their share of the market, making the competition more intense than anywhere else.”
“This market is really about applications,” Lansbergen said, “If you really want to make an impact, it's about understanding what an application is about and what it requires.”
And that requires more than just technology. “If you look at our people, they are not just materials experts, they also know the industry,” Li said.