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Topic: Strategy
How To Enter 2nd Market And Success For My Case
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I run a trading company in Hong Kong. I buy one product from China and sell to USA.
Product:
It is Replacement Battery special design for electric power of Nissan Hybrid car.
This products has its special:
1. it is NiMH battery, which is old fashion in car industry and will be replaced by Lithium battery in few years;
2. It is very expensive because car application spec is very high, and therefore you cannot sell them in any other applications for cost reason;
3. Production line for such battery is very expensive.
As a result, there are less than five suppliers in the world, and I get one source from China, with good quality and price.
Market:
The product is only use in after market for repair cars.
1. market portion 35% in USA, 30% in Japan and 25% rest of world.
2. The Chinese manufacturer has tried many years to enter USA but totally failure - very few customers will use important products in car with "made in China";
3. I have worked as their agent for 3 years and now the result is quite ok (annual sales usd1.5 million is not bad for a small company like mine.)
Change of Situation
Sole agent agreement no longer valid after 3 years, and the Chinese manufacturer start to sell to USA themselves with lower price, and my customers change to it. I lose around 30% sales in last 6 months, and my profit margin drop a lot.
If my sales continue to drop, I have risk to lost the agent right.
My Plan
Japan own big demand in this product. If I can get it, I will solve the problem.
However, I have tried hard but cannot enter it, I am not familiar with it and they don't believe on me.
The Chinese manufacturer don't realize such market. There is not similar product in Japan (except the original supply), and therefore the profit margin is high.
Can anyone teach me how to handle it? Or even cooperation to enter it.