to Grow

David Chalk talks about taking on the Japanese market

David Chalk, managing director, M-industry in Japan

Following his studies in Canada, including gaining an MBA at the University of Toronto, David Chalk, managing director for M-Industry in Japan, has spent most of his career in the food and beverage industry. First having come to Japan 30 years ago as a 20-year-old student, who had taken a year off to pursue karate and kendo, he was later hired by Toronto-based Maple Leaf Foods to go to Tokyo for four years. Now he’s back, heading up M-Industry’s entry into the Japanese market.

When you were here with Maple Leaf Foods, what were the challenges?

It was 30 Japanese people and myself, and when I first arrived in Tokyo with Maple Leaf Foods, I made all the mistakes in the book.

There were both language and cultural gaps to bridge. But it was a great learning experience; it just required a shift in mindset.

Second, you really don’t want to disappoint your customer because it’s a very service-orientated culture. You know the expression “customer is king”? Well, here it’s “customer is God,” so that was in the back of my mind the whole time.

How did you know M-Industry was right for the Japanese market?

Our parent company, Migros, is the largest retailer in Switzerland, and a cooperative rather than a shareholding company, meaning a very different mindset: It’s more long-term. We think in terms of years rather than quarters and that’s precisely the right attitude you need to be successful in Japan. Things don’t happen overnight.

Because Switzerland is a small country, we have been exporting for more than 20 years and, until now, mainly to destinations in Europe and North America. The interest for M-Industry in Japan and, by extension, Asia, is that this is a dynamic region.

Although Japan is the world’s third-largest economy, it is the second-largest food market after the United States. And, whereas the United States is 100 per cent self-sufficient, Japan is only 45 per cent self-sufficient, so the dynamic is different. This makes Japan a very attractive market.

It’s also a huge, highly-educated market of 120 million people, with an interest in imported products, and a very high standard of food safety and quality.

What are the opportunities and challenges in Japan’s market? How does it differ from the Canadian market?

Our objective in Japan is not to open stores but, rather, to import and sell excellent Swiss quality products. Although we are a big player in Europe, when it comes to Japan, nobody knows us and we really have to get in line and pay our dues like everyone else has done. Though Canada is a large country, the population is small, so Canadian companies must export in order to grow.

How different is the Japanese food and beverage market from that in Canada?

The Canadian market is pretty much self-sufficient, like that of the United States. But Canadian consumers are well-educated and multi-cultural, so they seek interesting products from around the world. This is quite similar to what Japanese consumers do, but I would say the Japanese consumer is more sensitive to product quality and safety.

How did you choose what would meet the tastes of the Japanese market?

At M-Industry we make more than 25,000 products, so we have quite a large selection from which to choose. First we chose some of our best, top-quality products with attractive packaging. The second stage was developing specific products for the Japanese consumer.

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