Case Study: PR euroCHEM / SME / Search for Partners in Japan

PR euroCHEM / SME / Search for Partners in Japan

Founded in 1998 in Ireland, PR euroCHEM is dedicated to the provision of R&D and organic synthesis services to the Fine Chemicals and Pharmachem Industries.

With its location at Ballyvolane Business Park, Cork, Ireland, the PR euroCHEM laboratories are situated in the heart of the burgeoning Irish pharmaceutical and chemical sector. According to customer specifications and needs, the company manufactures a wide variety of chemicals ranging in scale from milligrams to up to 5 kilos. The company maintains state-of-the-art facilities, staffed by highly-qualified and enthusiastic personnel, and has access to sophisticated analytical instrumentations such as GC-Ms, LC-MS, NMR, IR.

PR euroCHEM emphasises the safe handling of hazardous and potentially environmentally damaging reactions by focusing on novel and innovative methods of chemical synthesis. Each project is preceded by a full hazard analysis, and where necessary, dedicated facilities are constructed to meet customers’ requirements.

WHY JAPAN?

The demand for active pharmaceutical intermediates is huge in Japan’s medicinal sector. The expertise and know-how that PR euroCHEM can offer is unique, as the supply of prostaglandin intermediates or diagnostic products belongs to the highly specialized field of complex chemical synthesis. Especially in this area we could offer impressive synergy to potential Japanese partners.

STEPS TAKEN – 2013 EU-Japan Cluster Support Mission

In 2003, PR euroCHEM already had some contacts with a chemical trading company in Japan, supplying active ingredients. However, this contact was very limited, and PR euroCHEM kept looking for ways to establish itself on the Japanese market. In 2013, an opportunity presented itself in the form of the EU-Japan Cluster Support Mission, organised by the EU-Japan Centre for Industrial Cooperation. During this mission, PR euroCHEM’s General Manager Dr. Rabih-Gabriel Jaouhari met many potential customers, including his first big Japanese client, with the contract scheduled to be completed in November 2014. This client, based in the city of Osaka, is a pharmaceutical company dealing with peptides. The contract stipulates the synthesis and delivery of a pharmaceutical active ingredient to be used as a building block for a future product. The importance of this first big contract transcends the pure business deal, since it constitutes the first step towards achieving a lasting presence on the Japanese market. 

CHALLENGES 

It is not easy to understand the Japanese culture from a distance. With a European company, you will know almost immediately whether it is a viable potential client or not; they are very straightforward in the way they approach you. In Japan however, it takes much more time to seek out contacts and build relationships. Moreover, in Europe you can also frequently deal with the ‘boss’ directly, and a deal can be closed in a very short time. In Japan, however, you have to go from A to Z, and cover every step in between. You have to deal with the whole hierarchy, and it takes time before you get to the actual decision makers. Both hierarchy and relationships are evidently much more important in Japan.

“It is definitely very important that European companies get used to the way Japanese do business, because there are many opportunities for cooperation and market increase.” Rabih-Gabriel Jaouhari.

Another challenge lies in communicating with Japanese contacts. Misunderstandings can be common, so it is crucial to deal with Japanese contacts in a direct and frank fashion. Japanese businessmen often think in Japanese, even though they are communicating in English. This is why they can appear rude or even aggressive in communications (especially e-mails), but it is important to put it in the right perspective and remain friendly and calm.

Finally, Japanese companies often seem to prefer Chinese partners, perhaps because of their competitive prices. It is thus important to show them which comparative advantages you are able to offer in terms of quality, know-how and/or service.

CURRENT STATUS – NEXT STEPS

Mr. Jaouhari has kept in touch with multiple Japanese contacts which he met during the 2013 mission, mainly through their European partners, for example in the Netherlands and France.

Furthermore, he has a good rapport with the top executive of his first big Japanese client company, with whom he will be exchanging visits in early 2015. As a matter of fact, the Japanese executive will personally be collecting the materials instead of having them delivered to Japan, which again shows the importance of personal relationships.

Because of Mr. Jaouhari’s good experience with the EU-Japan Centre, he has again decided to take advantage of the centre’s support services, this time through the Human Resources Training Programme (HRTP). He will most likely be participating in the Centre’s May 2015 HRTP mission. The 4/5-week HRTP mission, designed to help participants become thoroughly informed about the actual conditions of Japanese business, includes basic Japanese lessons, which Mr. Jaouhari considers to be essential for business ventures in Japan.

Finally, there are some embryonic plans to set-up a PR euroCHEM trading branch in Japan, together with contacts established within the EU-Japan Centre with whom Mr. Jaouhari has stayed in touch after the 2013 mission.

Interview made with Rahib-Gabriel Jaouhari