DKSH throws its weight behind the nation
Date update: 3/30/2008

Swiss-based DKSH, the leading market expansion services group with a focus on Asia, intends to boost Vietnam into becoming a second Thailand in terms of its business success within the foreseeable future. Van Anh talks with the company president and CEO Joerg Wolle about how the company will reach that goal.

What winning strategies do you have up your sleeve?
Before focusing on your concrete question please allow me to mention that it was in 1989, that is almost 20 years ago, when I first visited Vietnam. My mission then was to restart the business for SiberHegner. After two years of careful preparation, SiberHegner - which merged in 2002 with Diethelm Keller to create DKSH - officially reopened its office in Ho Chi Minh City.

In other words, coming to Vietnam is always rather a special occasion since I have been personally involved in business here for a full 20 years. And, in the 18 years since we restarted our business, and I invariably see considerable progress each time I visit.

Now, to be more specific: looking at Vietnam, I see, first of all, a fascinating Southeast Asian nation that is substantial, both in terms of population and geographic expanse. Linking that population and business potentials across the country is a tremendously challenging perspective.
Given the exceptional growth potential of the country and the improvements we discern each year in terms of the business climate, we have decided that, in the future, Vietnam will become an even more important pillar in DKSH portfolio.

Moreover, we also believe that this market will be able to repeat the successes we have achieved with our business in Thailand, which is our biggest operation nowadays. Our clear intention is to make Vietnam into a second Thailand-style success story in the years to come. That objective is one to be taken very seriously, considering that we currently generate net sales of an impressive $3 billion in Thailand.

With our more than 22,000 employees, we operate in no less than 35 countries. At headquarters, we take decisions on the innumerable investment proposals we receive on a weekly, sometimes even on a daily, basis.
With regard to Vietnam, I certainly have sentimental reasons for giving this market priority. From a more practical business point of view, I have a clear assessment of the situation here and my belief is that Vietnam ranks second only to China in terms of investment, development and growth rates.

What is Vietnam’s position today in your overall group strategy?
Expressed in volumes of invested capital over time, historically our number one is Thailand with 10,000 specialists on the payroll. Number two is Malaysia with 3,000 staff members and number three is Singapore. The next place is already held by Vietnam.

In relation to new investment projects, I would say that Thailand is currently number one, with Vietnam already ranking very highly and closely on the heels of Thailand.
Vietnam also enjoys such high status within our group because Vietnam is a top priority market for many of the companies we represent in Asia, including Cummins, the world’s leading power generation manufacturer. Just a few months ago, I had the satisfaction of accompanying a delegation of top executives from Cummins to Vietnam.

We have been representing Cummins in Vietnam for 15 years already, while providing all the marketing and after-sales services required by this market. We are currently planning to form a joint venture with Cummins in Vietnam, on a similar pattern to Thailand, where we have just converted a 42-year old distribution agreement into a joint venture.

What is the background of your company in Vietnam?
In round figures over the past three years alone, we have spent more than $10 million on direct investments in infrastructure and information technology.
Our latest project is the expansion of our logistics center in the Vietnam-Singapore Industrial Park.
Since the completion of phases one and two of our logistics center in August 2002 and February 2005 respectively, our business growth here has been so impressive that this phase three extension became imperative. That expansion, that called for an investment capital of $4 million, doubles our local capacity and will serve as a catalyst for further growth of DKSH and our operations here in Vietnam. But, the true value of our investments reaches well beyond the actual capital spent. Since 2002, we have increased the number of specialists who are associated with our business activities in Vietnam from 500 to 2,150.

The comprehensive delivery service network of Diethelm Vietnam has been extended to 59 provinces nationwide, with direct links to more than 65,000 supply and end-user purchasing points.
It is difficult to put a figure on the indirect investments made for hiring, training and professionally developing our people.

But, with growth of human resources amounting to a tremendous 300 per cent over the past six years, the figure is impressive by any standards.

Author: Van Anh   

Source: Vietnam Investment

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