July 25, 2019
Dr. Eckel marks its special affinity with Asia on its silver anniversary
The company was started by his wife Dr. Antje Eckel, who is CEO, as a pure distributor of specialty feed additives in German-speaking Austria and Switzerland on top of Germany. By 2006, the overseas market contribution to Dr. Eckel's business was a significant 20%, and the company was deciding how and where to add pace to its growth outside of Germany. One step was to set up its own production facility. Another was to turn east.
Bernhard recalls the good relations the company had built up with its distributor contacts in Southeast Asia. Describing how Dr. Eckel clinched its first export business outside of Europe in 2007, Bernhard says: "We had already built up relations with a potential customer from the Philippines who wanted to buy from us. It was a classic business relation, quite a 'straight from the gut' decision."
Comparing the opportunity costs from a logistical perspective, Bernhard highlights: "It was surprising to discover that driving a truckload to western France was twice as costly as sending a container to Southeast Asia some 10,000 kilometres away!" After that, the strategy for business in Asia was set up.
As for Dr. Eckel's venture into the Indian market, things also started off smoothly during a business trip with the German government who helped link them up with a potential Indian partner.
However, there were challenges that the company had to overcome as it grew its export business. Among those were changes in procedure and manpower necessary for internationalisation, Bernhard points out.
Bernhard shares that people expect "something innovative" from Dr. Eckel's export business, and most recently the company is studying the use of fluidised bed trials to get different technologies running. In addition to distributing its own brands in Southeast Asia, Dr. Eckel has built up partnerships with strong companies which have the exclusive distribution rights for certain innovative products. Dr. Eckel has developed a multi-functional acidifier product which is distributed in co-operation with a German multinational in selected regions in Asia.
Often registration issues can be a critical point. In some countries, the registration process is slower and can often take up to two years or more, according to Bernhard.
He elaborates: "In Europe we have a 'positive list' of what is legal and there is flexibility in how to use and combine ingredients. In Southeast Asia, more such flexibility would be helpful. With regard to toll manufacturing, we have to consider thoroughly whether we choose to give away our intellectual property rights as our manufacturing process is often not simply a mixing of ingredients."
In 2016, Dr. Eckel launched an animal welfare initiative, promoting the fact that welfare starts with feed. As one of the first companies to address this major issue through in-feed applications, Dr. Eckel proves that animal welfare goes hand in hand with efficiency.
According to the sustainability goals of the World Health Organisation, the important role of animal nutrition is recognised, and Bernhard stresses that feed producers have to communicate to the industry what they are doing good for animal welfare.
"For instance, Dr. Eckel's Anta®Phyt improves dry litter quality of poultry, meaning higher profitabilities for meat producers particularly for high-value export markets. Even in Asia, some producers have already been producing feeds targeted for different markets. Especially for our large Asian customers, animal welfare is a major topic. In fact, I believe that the importance of welfare will increase in importance in the Asian market where there are large integrators which need to meet such demands from a growing middle class. And of course they need to adhere to European standards in order to sell their products into the European Union. Considering the future market potential as well as brand profit, incorporating Dr. Eckel welfare solutions will be profitable for the company," Bernhard explains.
Speaking on the aquaculture sector, Bernhard further exemplifies how Dr. Eckel is adapting its export business for the Asian market.
"Compared to the salmon market in Europe which is a relatively protected market, Asia is more open to discussions on aquaculture topics, and we believe it is important for Dr. Eckel to adapt if we want to grow here. Recently we have been awarded a huge research grant of 800,000 euros which is 50% funded by the German government, and part of the research is on shrimp in Thailand, mostly done at Kasetsart University. I could share that the research focus is on endotoxin detoxification," Bernhard reveals.
And trasforming its export business goes beyond products and production processes. When asked about what was their first export to Southeast Asia, Bernhard quips, "Relation."
Literally this was true, too. At its current site in rural Niederzissen near Bonn, Dr. Eckel had to set up a technical sales team that was dedicated for export. Today, although the factory still sits in the countryside, the workforce is a multinational one of 30 languages. Bernhard explains: "Such multi-nationality is quite unusual for a German medium-sized enterprise. But it is an important asset for an employer who wants to attract young experts from all over the world. In fact, many of our staff appreciate the option to live in a city and commute to a rural area for work."
"In spite of so many different nationalities and cultures coming together, cooperation and everyday tasks work rather smoothly. It surely helps that English has become the second company language in which every member of staff can communicate quite comfortably," Bernhard says. Perhaps the personal experiences which the Eckels had since young have positively influenced the culture at Dr. Eckel today. While his wife Antje spent three years of her childhood in Kenya, Bernhard himself had deep exposure to French families while on exchange during his schooldays. And their children studied with others of different nationalities in Canada.
The same thinking was at play during Bernhard's recent visit to Southeast Asia.
"This is the reason why I'm travelling intensively in Southeast Asia. There are a lot of regional topics which are not easy to grasp without being here in person. Systems in each country are different. Even within the same country, for example between Hanoi and Ho Chi Minh, it is necessary to understand the differences in culture, mentality and clientele, before one can understand how to do business," Bernhard concludes.