China is the world's fastest-growing healthcare market but it's often difficult for foreigners to break into it. German entrepreneur Joerg Heise is one of them!
Joerg, 29, has launched maxchina, a company that is shaking up healthcare distribution in China. He's been recognised by Fortune Magazine as one of the superstar "Top 30 Under 30" entrepreneurs in the country, but he wasn't always confident that he could do business there!
Joerg joined the army right after high school and holds a tank driver’s license. He quickly realized that wouldn’t help his career so in 2004 he joined the trainee program with healthcare giant Bayer.
The three-year program allowed him to work with the company as well as get a degree. By the end of it he felt equipped with an undertanding of how business works and was passionate about healthcare. Bayer was pleased with Joerg’s performance and invited him to get an MBA. The schools that he could select from were in Britain, the US, Spain and China.
Out of curiosity and a sense of adventure, Joerge chose China: “I had never been to China before and China was the most adventurous option because it was different. The core curriculums of most top schools are the same and what really shapes your experience is the place”, he said.
“So, I went to China without speaking the language or knowing much about the culture. It was more of a heart and gut decision”, he said.
Joerg’s feeling after the first three months was an urgency to get home. He found the culture, food and work ethic too different.
“I believed that the way things worked at home was the standard and I couldn’t work with them, I thought it was going to be longest few months of my life, but once I started learning the language it all changed. I started to interact with the locals and gradually moved on.”
In Joerg’s experience, foreigners come and hope they can change the people but the best thing to do is to open up and be curious. Joerg stayed five years after graduating from China Europe International Business School (CEIBS) in early 2009 and finds that he still learns something new about China every day.
He now runs maxchina between Germany and China. “If you were to blindfold me I could find my way to Beijing”, he said.
“The great difference of China still surprises me every day. I always discover new things. In fact, the culture shock of moving back to Germany was bigger than moving to China in the first place. I had changed so much”.
Joerg completed his MBA at the height of the economic downturn and it was difficult for fresh graduates to find jobs. He had the advantage of still being connected to Bayer and so he moved from Shanghai to Beijing. He worked in Executive Management support and Commercial Management roles for two years.
The challenges of managing growth in an international company based in China were very different. “Nobody in Europe could tell you how to hire 1,000 people in six months. It was a very insightful experience because it taught you corporate entrepreneurship. You had to think about new ways to overcome these challenges”, he said.
This was tough given that the Chinese market is huge. “There are 20 million people in Shanghai and that’s twice the population of Belgium. There are 200 cities with over a million people that you’ve never heard of. You cannot think of China as a whole rather you have to think of it as 30 different countries with 30 different systems.”
You also get the entire range of healthcare needs. “You have people who have nothing and then those who can just about afford basic healthcare and then there are clinics that offer services so advanced that you haven’t even seen them in Europe”, said Joerg.
There are more people moving to cities and about 170 million people aged over 65 so the health needs of the population are vast. There is the challenge of giving access to healthcare and with international products being too expensive for most, local companies are innovating quite quickly.
For Joerg, starting the business was not motivated by getting rich quickly. It is about creating something sustainable and bringing innovation from, say, a small-town German firm which has a great product to a remote part of China.
Joerg’s time at Bayer gave him experience of working distribution in "second tier" cities like Chongqing, Changsha and Kunming which people who are not so familiar with China would not know of.
Joerg predicts that the future of China lies in such places. “You see Gucci and Prada shops there and can tell that there is good purchasing power but companies don’t yet know how to get their great products in”, he said.
This motivated him to start maxchina since he knew China and distribution and also knew people who had great products but didn’t have the capacity and resources to enter China. maxchina manages distribution for foreign firms and offers tailored consulting and advisory services too.
Joerg has a passion for China and he loves innovation. He also said that his MBA network from CEIBS has been invaluable. “Often times I may not know the answer but I know someone I can ask”, he said.
With over 130,000 healthcare distributors in China, Joerg struggled to create a name for himself. He said, “In the beginning you don’t have a strong portfolio and your dreams are high but your cash flow is in the other direction.”
For each product you have to test the market, do price negotiations find out how you would sell the product whether online, physically or both, he said.
He stresses that it is important to be open to the culture, including the language, since this will help you build your local network: “I will never be as fluent as a Chinese person but I had to build a local network because they only help you if they trust you. You have to be aware that it takes time.”
Please Enter the Code Below