|iF Juices: Turn a Good Concept into Real Business|
|Foreigners in China|
As a lawyer Hans Au once advised corporate clients in Europe and Beijing. His friend, Florian Eysler, was a purchasing manager for a European auto-maker in Beijing: just the kind of people you'd expect to quit their corporate jobs and start a fruit juice company in Beijing. Right?
Au and Eysler's tiny iF Juice Shop in the Central Park community just inside the East Third Ring Road in Beijing may not prompt thoughts of finely honed legal arguments or precise automotive specifications, but it exudes a sense of precision and restraint, with an emphasis on quality and sanitation (you can watch them as they work). The 25-square-metre iF shop that opened in November 2007 is a powerhouse when it comes to producing smoothies and fresh-juice beverages.
But the attention to detail does not stop there: with just a glance at the iF menu, rendered in English and Chinese, customers can assess the sweetness value of each product offered by the duo, whether it's a naturally sweet watermelon drink carrying a “four-red-apple” rating or a bittersweet “four-green-apple” rating for the grapefruit drink or other delights in between. Even the “teardrop” bottles used to sell the beverages are unique, bearing English and Chinese logos and ingredient tags, and if you must have one, there's an attractive media kit available that tells the iF story.
The enterprise's simple, tasteful presentation is underlined by an equally simple and tasty concept: “Before we started, we promised our friends and families to never ever put anything nasty (like sugars, juice concentrates, preservatives, or even water) into our beverages. And that's how we keep it: simple, pure and natural.”
Yet all of this leads to a bigger idea: cultivating a brand name and making it last. That's why, even before the iF store was opened, iF had employed a full-time designer to take charge of all the images and decorations of the store and its products, Au, the founder and manager of iF Foods Limited, said.
Au first came to China in 1995 to work on his doctorate in Chinese law. After two years' study at Nanjing University, he returned to Germany before joining a British law firm that eventually sent him to work in Beijing in 2002. His Chinese improved greatly in his daily communication with the firm's Chinese clients, and it was during this time that he met and married his Chinese wife. The couple has a beautiful son.
In 2005, Au quit his job. Still, the idea of starting a juice shop had not occurred to him. It came to him from the sweet difficulty of raising his son, who was just 2 and who hated eating vegetables like so many other kids. One day, the child's ayi (maid) left some sauce in a pan after making a carrot dish. Rather than try to foist the carrots on the boy, Au simply poured the juices on his son's rice. The boy ate it without complaint.
As a result of this experience, Au decided to buy a juice-extractor set, and often invited his son to join him in making fruit and vegetable juices. A transformative event happened: his son was happy to drink the juices he'd helped create, because, as Au said, “It was his own achievement.”
Au, a vegetarian who follows a natural and healthy lifestyle, discussed the idea that was forming in his mind with Eysler, who shares some of Au's ideals: they formed a business partnership with the goal stated above.
They began by squeezing, blending and mixing fruit and vegetables. Selling out 200 bottles of their three basic recipes within a couple of hours at Chaoyang Park in the summer of 2006 convinced them to continue: iF was born.
The first shop represented an investment of 180,000 yuan (US$27,000). Soon, a major obstacle would loom, because in the beginning, the one-day shelf life of their preservative-free products resulted in some waste. Gradually, they adapted to their customers' preferences and the varying requests they got in winter and summer. The amount of wasted product began to decline and is now controlled at about 10 to 15 percent, according to Au, with every effort being made to sell the right product to the right people at the right time.
Central Park area residents have fallen for iF. During off-days, iF sells an average of 50–60 bottles per day; the number triples during the summer.
The daring duo recovered their initial investment in just four months, as one good thing led to another.
Several months after opening, the chef of a famous five-star hotel in Beijing visited the store and asked iF to serve as a juice supplier for the hotel. This inspired Au and Eysler, who expanded their marketing effort. They began seeking contracts with hotels, restaurants, embassies and multinational companies in Beijing to supply their products, and iF is now a supplier to the Ritz Carlton and The Pennisula, supplying 100 litres of iF products per day.
At the same time, iF is enlarging its production capacity to meet mounting orders. In the latter half of 2008, iF began designing a larger production facility in southern Beijing to serve corporate clients, mainly. Now, the 400 square metre facility stands near the Xinfadi Farm Product Wholesale Market, one of the largest in Beijing.
But what does it take, as a foreigner, to run a business in China? Au said the most useful lesson is to understand the cultures and histories of China and the Chinese, which are totally unlike those of the West with regard to distinct practices and approaches to problem-solving. He recalled a night when some of his imported equipment, weighing 700 kilograms, was delivered. He was shocked when he saw the big machine being unloaded by a delivery man and several security guards. Had this happened in Germany, he might have been stopped by the police and sued.
“There are things you think are very hard to accomplish in Germany that are very easy in China, but there are also things the other way round,” said Au. “You can easily outsource certain business activities in Germany, as there is a very detailed division of service suppliers, but in China, you have to be more versatile. Besides, you cannot manage your Chinese employees using the complete and mature style of corporate management in the West: there is a looser culture here. Also, you have to rely more on private channels of capital, as financing for small enterprises in China is insufficient.”
However, as a foreigner, it is wise to adapt to the environment, said Au. “You have to constantly adjust yourself to the realities here. However, you don't have to change everything as we have our own advantages as foreigners. The perfect way is to find the zhongyong zhidao (the way in between),” he said with a proud smile as we expressed our surprise about his understanding of zhongyong zhidao.