Week 9 – Lesson 15
UNIT 9 – Import Export
After three years travelling around Asia as head of BARCO’s activities in the
region, Joost Verbrugge is convinced that India is one of the most exciting longterm market opportunities in the world and one of the most complex. Since 1994,
BARCO, best-known for its digital projectors for computers, has gone from a
relatively low level of exports to India to selling about BFr 200m of products there a
year, half exported from Europe, half assembled on the spot. That is a small but
significant part of its total BFr 23bn turnover last year.
Expansion in India has taken place at the same time as a shift in BARCO’s
strategic focus, and its emergence as one of Belgium’s fastest-growing companies.
Created in 1934 as the Belgian American Radio Corporation, the company moved
out of consumer products in the 1980s. It concentrated instead on high-value niche
markets such as computer projectors and specialist display systems.
From its base in Kortrijk, Flanders—Belgium’s Dutch-speaking region—it has
exported to India for more than a decade, originally selling kits for video monitors
to the national television station, through local agents. Four years ago, it set up its
own sales and services office in New Delhi. It now has a smaller sales office in
Bangalore, a software house in Chennai and a projector assembly
plant in Noida, near New Delhi.
UNIT 9 – Import Export
Having invested about BFr 100m, and now employing 150 people in India, it
plans a further sales office in Mumbai and a components factory in Noida.
‘That is quite a lot for a small company like BARCO,’ says Mr Verbrugge. ‘It’s
mainly investment for the future. The market is partly there now, and we are
convinced it will definitely be there in a few years.’
But for those wanting to exploit the potential, obstacles remain. Although
India has make efforts to open its economy in recent years, Mr Verbrugge says
it remains more closed than other fast-growing markets such as China when it
comes to bureaucracy, import duties and tax barriers.
‘It is not unusual to have import duties of 40% on things that you would
consider normal working tools, like a printer for a PC,’ he says. ‘As well as the
high import duties, you have a famous—or should I say infamous—
bureaucracy.’ This can have important practical effects. Mr Verbrugge says
that BARCO would like to assemble more of its products within India, but this
would mean importing components from 20 different countries, creating huge
amounts of paperwork and delays.
UNIT 9 – Import Export
Although India is welcoming to foreigners, Mr Verbrugge says there are also
cultural hurdles which can initially be deceptive. ‘On a first visit India seems
easier than China or Japan because people speak English. Only after you
start operating there do you see all the complexities. There are sensitivities
between states, between religions, between strata of society.’ Such differences
also make the country fascination. ‘India is a hundred different worlds living
next to each other in the same country,’ Mr Verbrugge says.
These practical and cultural complexities were largely behind BARCO’s
decision to set up its own sales office in the subcontinent. ‘Much more is
needed than just having an agent with a fax and a phone. You have to
understand the marketplace, how Indian business works.’
But the opportunities presented by India outweigh any disadvantages. ‘If you
can afford to miss a fifth of the world’s population, you can afford not to be
there,’ says Mr Verbrugge. ‘I think any company serious about having a
worldwide market share can’t be absent from India.
UNIT 9 – Import Export
UNIT 9 – Import Export
UNIT 9 – Import Export
UNIT 9 – Import Export
UNIT 9 – Import Export
UNIT 9 – Import Export
b old-fashioned typewriter
c short-term opportunities
d low-budget advertising
e well-known personality
f high-level decision-making
g user-friendly software
h well-trained staff
Other examples of compound adjectives: right-wing, left-wing,
open-minded, narrow-minded, home-made, long-lasting, highprofile, all-inclusive, etc.
UNIT 9 – Import Export
Listen to an explanation of the invoice (see next slide) and
complete the missing information.
UNIT 9 – Import Export
UNIT 9 – Import Export