07/03/2008 - Instore communication: joint venture in fast growing market.


‘Economically speaking India can be compared to the Netherlands in the post war years’. So says Ed Tchai, director of the instore communication specialist Tchai International in Ridderkerk, the Netherlands. ‘But developments are going much faster. The people want consumer goods. TV’s fridge’s, coffee machines, mobile telephones and other apparatus are booming business’.

‘Because of this there is a change in the shopping norm. There are still differences when compared to Europe, but larger businesses are appearing. The sort of instore solutions that we develop are rarely seen there. For us this was the motivation to look for a company to work with in India. We shall be trading under the name Tchai GMT (Genesis Modern Trade)’.

From Ridderkerk to Mumbai
Tchai International is going into business with the Attari family; a mother and her two sons who run a printers in Mumbai, making cardboard displays. Tchai develops and produces instore communication concepts such as displays, shelf systems, shop in shops and complete shop fittings and retail solutions. Especially used are permanent materials such as wood, plastics, glass and metal. At the moment there is much travel back and forth. ‘Our people are going there on a weekly basis’ says Ed Tchai. ‘We are training the local staff, teaching them to think in concepts and design. We are also taking lots of experience and knowledge to where they are still taking their first steps’.

Taking the ‘climate’ into consideration
India is well on the way to becoming a modern country. It is potentially an enormous market; three to four times bigger than that in Europe. Changes are coming fast. For example there are between seven and nine million new mobile users every month, but it is of course a completely different environment. ‘Many shops are only half the size of my office’, continues Ed Tchai. ‘There you have a large number of small family owned businesses and you must make things that can be used there, of course. There are also the countless stalls along the roadside’. The climate must also be considered. ‘It can be extremely warm and humid and for this a good material choice must be made’.

Development and cultural differences
‘The same instore developments that we have seen in Europe will also happen in India’, Ed Tchai predicts. ‘Only the speed of this will be somewhat faster. In a manner of speaking you can see it happening before your eyes’. As joint venture partner Tchai International can make a constructive contribution. ‘We know from our own experience how these changes happen and what to be aware of. Of course there are cultural differences. An image that is completely acceptable here, may be unsuitable there. Or perhaps a certain colour may have a meaning, that we don’t understand. For these reasons it is vital that you work with a local partner who will ensure that you don’t fall into any of these traps’.

The lack off local expertise
With regard to instore communication all brand manufacturers in India face the same problems. ‘Expertise is still rarely found. In printers and other production companies in India the quality is often very poor and the colours are not good. This is while the large brand manufacturers, that operate worldwide, require high standards. Canon, for example wants it’s own Canon-red and Samsung it’s own Samsung-blue and this isn’t always possible. Plastics, lacquers and high gloss lacquers in many colours are not in stock and that is also true for special materials that can be ordered here by simply picking up the telephone. We can take good advantage of this as we, as a western organisation, require the same high quality in regard to design, construction, material choice and production. We still have much work to do, also with training, but a start has been made and the first positive results are in. Two important factors are working with us; India is well in the IT road and English is the main language used’.

European knowledge helps brand manufacturers
‘Actually we are setting up a clone of our company in Ridderkerk, the Netherlands’, says Ed Tchai. ‘We are one of the first to do this. There are enough local advertising bureaus and the can make good pictures and designs, but they cannot produce them in 3D. Our European knowledge can help brand manufacturers and retailers with this. We think in terms of both micro and macro. It can go from a simple stand for 12 chocolate bars to big displays, shop in shops or for example a complete car showroom’.

47 years of experience
Tchai International was established in 1961 and at the moment employs more than 60 people. Originally, the family company manufactured mannequins for shop windows and interiors. At present they offer a full instore service, from concept to design and engineering. This can involve extremely large projects. For Cadillac & Corvette Europe Tchai developed “experience centres” where experiencing the product stands central. Tchai mostly makes displays from permanent materials of which small numbers are being produced in it’s own factory and large numbers of components of displays in Bulgaria and China.

Support through government subsidy
Besides expertise the Indian branch of Tchai will also bring employment, higher and better working conditions. Emancipation also plays a role; 30% of new workers will be women. The Dutch government saw enough reasons in this joint venture to support it with a subsidy. ‘Excellent’, says Ed Tchai. ‘It offers us more elbow room in this busy start up phase’. He is counting on a trial phase of 2-3 years before the project is fully off the ground.