Success Stories

Success Stories
Business Type Seller
Subject Export deal signed for domestic baby products to Post China in Vietnam
Product Name GaksiMil Electric Breast Pump View Product Detail >
Product Category

Home & Garden > Baby Supplies & Products > Feeding Supplies

Home & Garden > Baby Supplies & Products > Other Baby Supplies & Products

Company Name MSJ Co., Ltd.
Summary The baby products market in Vietnam, rising as the “Post China market” for baby products, is growing at a remarkable pace as the percentage of the population of children under the age 12 as well as the rate of increase in income skyrockets, which has led to more and more buyers looking for Korean-made baby products.
Contents

GaksiMil Electric Breast Pump


The Vietnamese baby products market was worth about $1.3 billion as of 2016 and shows an annual growth rate of 6.6%. Vietnam, which is rising as a Post China market for baby products, is growing at a remarkable pace as the percentage of the population of children under the age 12 as well as the rate of increase in income skyrockets, which has led to more and more buyers looking for Korean-made baby products.


In 2016, a Vietnamese buyer sent aggressive inquires to baby product manufacturers within the tradeKorea website. A matching representative of tradeKorea requested the buyer for a company introduction and information on their future sales plans. The buyer stated that it currently owns about 70 retail stores for baby and mother products in Vietnam and plans to increase the number of stores to 100 by the following year. Furthermore, the buyer sells famous foreign brand products such as Meiji P&G, Unicharm, Morinaga and Combi.


After learning that the buyer is looking for products including silicon feeding bottles, liquid cleansers, feeding bottle washers and breast pumps, the matching representative began investigating tradeKorea member companies and related domestic manufacturers, and found that there are only three breast pump manufacturers in Korea. Two of them already had exclusive accounts in Vietnam while MSJ, which had been conducting a distribution business mainly within Korea but began preparing for exports for the past two years, was the most suitable company to recommend.


To examine the products thoroughly, the buyer requested a sample of an electric breast pump from MSJ. After the product test was completed, the buyer was satisfied with the quality and delivered its willingness for an exclusive contract with MSJ. An exclusive contract has an advantage for a small- or medium-sized company to enter a local market without having to spend a significant amount of cost and time but, as the market grows, also has a disadvantage in losing potential sales opportunities through various channels if the company is tied to a contract with a buyer, which is why it must be carefully considered.


The negotiations began but the process did not proceed smoothly. During the discussion on a down payment, the annual sales volume planned by the buyer did not match the volume expected by the company and, as the gap between the two parties did not lessen, the negotiations were on the verge of falling apart. It is because a supplier can sell its products at a competitive price only when the production volume greater than a certain level is secured, manufactured and supplied.


As the certification and registration procedures for baby products in Vietnam are difficult, the tradeKorea matching representative intervened to start the negotiations once again by supporting the buyer’s local certification process and, at the same time, helping MSJ adjust the contract volume, arbitrating both parties to concede a little bit. After listening to the explanation of the representative and learning about the buyer’s strong will to aggressively develop the market, the company restarted negotiations with the buyer and was proposed with an expected volume for a 3-year sales plan.


Other than this, the buyer is in sample deals with breast pads manufacturers, and the buyer and the seller have both e expressed gratitude towards the tradeKorea matching team for its support from the initial matching to the final stage of the successful export deal.


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