Scottish Connections Business Breakfast held with Chief Executive of Scottish Enterprise

Published on 2019-05-16

Launched by the Scottish Focus Group, the 'Scottish Connections @BritCham' business network continues to grow and is proving to be a useful network for all those companies and other organisations associated with Scotland and doing business in China.

The Scottish Focus Group (SFG) held a Scottish Connections Business Breakfast on Wednesday, 8th May with over 30 members attending. This was the second time this year that the Scottish Connections business network has met.

As well as connecting with other members of the network it was a great opportunity to hear from visiting special guests, Steve Dunlop, the Chief Executive of Scottish Enterprise, Scotland’s national economic development agency and Paul Lewis, the Managing Director of Scottish Development International (SDI), the agency which supports Scottish based businesses to trade and export, and seeks to attract inward investment working through a network of more than 30 overseas offices including Shanghai, Beijing and Hong Kong.

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(Steve Dunlop, Chief Executive, Scottish Enterprise)

Steve spoke about Scotland’s great track record both in exports and in attracting inward investment. However there was much more that had to be done. Scotland’s new Export Plan (A trading Nation – a plan for growing Scotland’s exports) will lead to more integrated resources and new ways of stimulating export performance.  And as part of this there will be a stronger focus on China as a priority market. 

Some of the specific topics covered by Steve and Paul, including those covered in a very comprehensive and interactive Q and A session were: 

  • Progress on the development of the Scotland is Now campaign as part of “Brand Scotland”, and when will we have something that can be used specifically for the Chinese market.
  • The role and capacity of the new Scottish National Investment Bank which is being set up as an independent entity.  
  • Attracting capital, both human and financial to Scotland and managing the risks around talent migration.
  • The impact of climate change and the declaration of a climate emergency on Scotland’s economy and export performance.
  • The impact of Brexit on the Scottish economy and the need to increase resilience. 
  • The need for a demand led rather than supply push approach to the Chinese market ie Scottish companies need to really take time to understand Chinese needs rather than just jumping to a “here is what we can offer” approach.
  • A more joined up and collaborative approach by companies entering the Chinese market across the supply chains.
  • Learning from other countries on what is best in class, on country branding, integrated supply chains, joined up agency support, consistent relationship building.
  • Recognition of the pace and intensity of doing business in China and that support needs to be structured around giving companies capability to survive and thrive in this environment.   
  • The importance of Scottish diaspora and the need to make more of Scotland’s wide range of international assets and strengths, including GlobalScots, broader international networks and alumni connections.  

Blair Kelly, SFG Chair spoke about the progress of the Scottish Connections business network and the need to lever what we have now put in place to create mutual benefit for members and for Scotland overall. Blair also highlighted that the SFG is prioritising the partnership with government, particularly the government agencies. Hence the importance of having Steve and Paul as guests at this event.  

Dr Lu Jianzhong, SFG member and President Weir Group China thanked Steve and Paul for coming and for their insights, support and listening.  Dr Lu said he looked forward to seeing how the Export Plan would manifest itself on the ground here in China so that we collectively can improve Scotland’s performance.

In a subsequent small roundtable with senior business leaders, hosted by SDI, there was a discussion on what Scottish companies need to do well to enter the China market. The feedback and output from this discussion, which will be of interest to members, was as follows: 

  • Build trust: this is based on deep lasting relationships, of course, but needs a deep understanding of everything from China’s perspective.
  • Develop capability: the pace of change is fast and companies need to be able to respond to this. Local competition is credible and often cheaper. Differentiation is required. This can include additional services for manufacturing companies. 
  • Maintain commitment:  Time in the market and repeated visits are required. This includes senior leaders and CEOs.
  • Keep a long-term vision based on China’s requirements: Businesses need to be able to address China’s requirements and changes (rather than simply pushing products).
  • Understand the market asymmetry: Scottish businesses need China more than China needs them.  This needs to be understood and responded to. Scale can be a challenge but not insurmountable, especially if regional economies are targeted.
  • Exploit green growth: There are many opportunities in the low carbon markets and managing the energy transition.  
  • Identify Scotland’s “beachhead” companies; those that are established and can help pull through others for example in their supply chains.

In wrapping up the roundtable, Paul Lewis summarised three challenges that we collectively need to better understand:

  1. “What’s in it for China”? In what ways can Scotland contribute to China’s long-term growth?
  2. How can long-term relationships be better established? (and how can support provided to help SMEs build these relationships ?)
  3. How can we help Scottish companies be better prepared for the market? (and address the points raised above)