China – Focus on a Growing Market – Part 2 – Rob Fryatt interviews – Huang Xiao Yun of the Chinese Pest Control Association.
Ms. Huang: “China has an unparalleled market capacity and everyone will have a chance to gain from the growth in the service sector.”
You may well be reading this edition as FAOPMA holds its Annual Conference and Exhibition at the Convention Centre in Adelaide, Australia. One important and influential lady who will be attending will be Ms Huang (Huang Xiao Yun) the Deputy Director of the Chinese Pest Control Association. Since the CACARSI (Chinese Association for the Control of Rodents and Sanitary Insects) changed its name to the simpler , Ms Huang has been a regular presence within the Asia Pacific Regions international industry as the representative on the CPCA on the FAOPMA Executive.
I have had the pleasure of inviting Ms Huang to speak at the Beyond-Agriculture seminars in China. These events have permitted me a rare insight into the fast-evolving and maturing Chinese industry. Whilst attending the recent event in Nanjing, China, I took the opportunity to catch up with Ms. Ms. Huang: “China has an unparalleled market capacity and everyone will have a chance to gain from the growth in the service sector.” Huang to give readers and subscribers of International Pest Control a unique insight into understanding more about the pest control industry in one of the most significant global markets of today and perhaps the most significant for the future.
Ms. Huang. Let’s start with some simple and straightforward information on the Chinese industry for our readers: How many pest control companies are there in China? What is the growth rate of the industry? Are the leading companies operating nationally or is the Chinese industry predominantly focused on individual cities and regions?
There are about 8000 PCO companies in China and our information indicates we currently have a growth rate of around 5% per year in revenues. There are a few leading companies that operate throughout China. There are also sizable regional players, but much of the industry is comprised of small companies
Could you outline the structure and function of the CPCA. What categories of members do you have and how is the membership split between them?
The CPCA is the only national association for the pest management industry in China. I am responsible for its daily operation under the guidance of the Chairperson, within the framework of its constitution. The annual conference organized by CPCA is aimed to enhance and build the role and function of the organisation and the industry. We aim to build an industry-wide platform for our members, to facilitate dialogue between government agencies and business community and provide opportunities for international and domestic companies to exchange information and learn from each other.
The day to day operation includes service certification, professional training, technical support and the many functions a national industry association does in any country worldwide. Our membership is mainly pest management companies (342), the industry suppliers (78), Public Health Authorities (52) and local and regional disease control centres (17). In all we have over 500 members.
Service Industries, such as pest management, have only been open to foreign investment for a few years. How do you think this has influenced the industry so far and how do you think this may change in the future?
Rob, I believe the opening to foreign investment has been a great idea and we have benefitted so far. It has brought new management expertise and encouraged the national domestic service sector to strive for higher level of service quality. We have already seen the value of diversification of the services provided and can see the place for the “European” style facilities management companies. It will certainly benefit the future growth of the industry.
As an industry we are finding that key client sectors such as hospitality, fast food and food manufacturing have become more international, looking to contract to a consistent standard wherever they operate worldwide. How is this influencing the development of the Chinese industry?
We have just begun to encounter similar issues in China. International companies expect to contract to international standard in China. We have started paying attention to this new requirement and will devote our efforts to implementing a national standard and look to learn from other international industry standards. This is fundamental to the future of our industry and will ensure continued and healthy growth.
You are clearly recognised as the leader of the national industry and have played a leading role in FAOPMA for some years now – this included hosting the highly successful FAOPMA conference in Beijing in 2009. How important do you think it is for Chinese companies to exchange views with other companies outside China?
It is imperative to have Chinese companies exchanging as many ideas with their foreign counterparts as possible. From PCO perspective, we are still a young industry and growth has been relatively fast in the last ten years. There is a lot to be learned from foreign companies that have decades of experiences. This will allow Chinese companies to avoid potential pitfalls. From the suppliers’ perspective, Chinese products do need a major upgrade in areas of “green and sustainability” and improved understanding and cooperation on intellectual property will benefit the industry. This will create a win-win situation for both Chinese companies and those investing in the future of China.
I have heard you speak on many occasions, so I am well aware that you are committed to raising industry standards and in particular increasing both the quantity and level of training. Could you explain how this operates in China and the role of CPCA in this process?
We are the main sponsor of the training programmes in China. We are respon- sible for certification of the PCO and sanitation technicians. We promote our continuing education program and the national standard and training. In order to reduce costs to the PCO we are also considering remote training programmes through the internet. Some of our regional associations and large companies also provide training programmes at a local level. We are considering plans to send our members overseas for additional training in the future.
As hygiene standards increase and consumers have more disposable income to spend on goods and services. what role does the CPCA play in educating the Chinese consumer about pest management and the choices available?
We understand that in order to help our industry grow, education and guidance of the consumers requires our association’s attention and effort. We have been contacting other associations, such as the hotel management association and the airport authority association in order to develop joint activity to educate consumers. In the future, we shall reach out to the consumer protection agency as well as members of news media to raise awareness of our industry and our industry standard. In China, it is expected that this is a function of the industry association. We are fully aware of our responsibility and are planning action in the near future.
I have personally provided consultancy services to Chinese companies for some years, but increasingly Western clients are asking me: What about China? How should we approach the market? In your opinion, if a foreign company wants to establish a successful partnership in the Chinese market, what would you advise them to do as their first action?
The first step should always be research to understand the market. This should be carried out by an independent organization – you might not want to rely on the information provided by your potential partner in China! Second, you must understand the cultural difference and thirdly you must understand China’s business model and don’t be overly aggressive. I have personally witnessed problems encountered by foreign companies in their Chinese operations due to not understanding these factors. Although revenue growth may be the main driver, business reputation may be more important as it is difficult to repair in the future after problems have occurred.
So Ms. Huang, do you have one final message for our readers?
Rob, to close, I would like to say China has an unparalleled market capacity and everyone who is paying attention to China will have a chance to gain from the growth in the service sector, but the key is to find the right approach. The CPCA can provide a range of quality consultancy services which can, depending on the nature of the project, be fee-based or free to assist companies interested in China. As you know we can be welcoming and friendly hosts.
As Ms. Huang has outlined, China is a market that the industry will need to watch and understand constantly. It will present opportunities for many companies, but not everyone. Those who work to understand the culture, invest to visit the market, choose carefully and nurture successful partnerships will be the winners.
The Chinese market will continue to grow, raise standards and mature. Over time its leading companies will become better known and respected outside China. I sincerely hope that Ms. Huang will continue to play a leading role in its national development and be the visible external face of its industry for many years to come. In closing, I would like to acknowledge and thank Pascal Cai of the CPCA for his assistance in making this interview possible.
Published in International Pest Control – May/June 2012 issue.
Category: Special features
