Painting a regional picture (hktdc.com)


	Kakadu Masakazu and Tammy Chui from SKK Hong Kong, a company which has been increasing its profits year on year

Japanese company SK Kaken Industry Ltd, a manufacturer of special coating paint for professional use, renovation and building materials, is utilising its Hong Kong office as a successful business model for its other branches in Asia.

The Hong Kong base set up in 1983 with about five people has since grown to more than 30 staff. Kakadu Masakazu, Director & General Manager, SKK (HK) Co Ltd, explained that it was a combination of talented staff and good business strategy that has enabled SKK to capture between 60-70 per cent of Hong Kong's professional paint market. With growth increase between 10-20 per cent annually, SKK Hong Kong is in a very healthy position.

"We have had the good fortune to hire very good and dedicated local staff right from the beginning. Hong Kong people are very experienced and skilled in dealing with the locals, mainlanders and people from around the world," said Mr Kakuda, who joined SKK Hong Kong nine years ago. "The Japanese are not very good communicators especially in English so it's the crossover strengths, this combination of Japanese and local staff, which is fundamental to our success in Hong Kong."

Safe, secure platform

He added that as a manufacturer, the company needs Hong Kong's stable and secure platform to operate and offer quick response to meet their clients' needs. "These combined factors have made the Hong Kong office a successful business model for other SKK offices."

SKK has certainly come a long way from the time it started in Osaka in 1955 as a small manufacturer of decorative coatings business and paint for professional use. It now has offices in 48 places in Japan and also owns factories and laboratories in Japan. It has eight subsidiary companies in Hong Kong, Singapore, Malaysia, China, India, Vietnam, Korea and Thailand.

Founder and President Minoru Fujii tried to expand directly in the Chinese mainland about 30 years ago but failed. "He felt more confident about setting up SKK in Hong Kong in 1983 as there is rule of law, transparency, and people have respect for contracts which are executed under English law. He also wanted to use Hong Kong as the entry point for the mainland market." Shanghai was later set up as a subsidiary office of SKK Hong Kong in 2003.

Hong Kong is also a base to import materials from Japan. "About 90 per cent of the paint and other materials used for our Hong Kong clients are directly imported from Japan with the rest coming from our Singapore factory," said Mr Kakuda. Some of SKK's clients include AsiaWorld-Expo, Hong Kong International Airport, Disneyland and Cross Harbour Tunnel. "They want only the best grade of paint. Our R&D in Japan has devised a lot of products to suit each level of the market so we can meet every kind of demand."

Opportunity everywhere

SKK Hong Kong's Deputy General Manager, Tammy Chui, said that even during the 2003 Sars crisis, business was good. People were not taking any chances as they renovated their homes. SKK had the contract to provide paint for renovation work in Amoy Gardens, the place where Sars was first detected in Hong Kong. It was a big job as there were 16 blocks and each block was between 20,000-30,000 sq m.

Competition is tough especially in China. "Our Shanghai office tells us there are more than 3,000 brands of materials and paint for professional use simply in Shanghai city, so it is a very competitive environment," explained Ms Chui. In Hong Kong, there are not a lot of Japanese brands although there are international brands from all over the world.

Mr Kakuda reiterated that his vision for the Hong Kong office is not so much sales driven as using it as a model office for other SKK offices. "Every year the Hong Kong office has been increasing its profits but there is a limit to how much we can increase because of the market size," he said. "We would rather develop our Hong Kong office as a role model and impress other SKK offices with our good management and leverage on our clients' success. As they grow, we grow together with them to create a win-win situation."