Special culture and environment are created from special history and political background, and Korea is such a place with special industrial market. Delta Industrial Automation Business Unit (IABU) has been promoting its products in Korean market for over 10 years, yet not many know about our efforts and results. In this report, we'll lead you enter the world of Korean industrial markets with Delta IA Korea – Mr. William Lee.
New Market, New Opportunity
Delta Korea was founded in 2004 with only 10 employees, and Delta IA joined in 2006; but in fact, Delta IA products entered Korean market way back in 1996. In 1996, when Delta had just a small agency instead of a branch office in Korea, Delta VFD-A series AC Motor Drive (AMD) was firstly launched into Korea with the help of a few distributors. Until 1997, in order to protect local IA companies overcome the economic crisis, Korean government executed “Import Source Diversification Policy” and prohibited the import of many Japanese industrial products, including AMD products. As a result, many Japanese companies joined Korea manufacturers who imported all components and accessories to assemble and produce AMD products in Korea. Under the circumstance, Delta VFD series AMD was lucky to find the chance.
“Back then, Japanese AMD products were with the best quality because the technology and materials are all from Japan; on the other hand, they were so expensive and not every manufacturer can afford. Somehow, the manufacturers didn't have many choices because the quality of other local brands was bad despite the low prices. So our AMD products gave them a totally different choice with relatively low price comparing with Japanese ones and much better functions and quality comparing with local products. Our promotion was successful, and we started to expand our market share step by step,“ said William.
Business in Adverse Environment
In 2000, when IMF control was finished and “Import Source Diversification Policy” was canceled, Japanese products started to enter Korean markets, but Delta had a second chance to promote VFD-M series AMD into treadmill and industrial washing machine markets in Korea despite the threat of Japanese competitors in 2001. William said, “Koreans started to get crazy about health and excise, and treadmill became very popular in 2000. Back then, the system of treadmill in Korea still adopted DC motor drive and washing machine had the frequent problem with its bad load condition. As a result, most manufacturers were looking for better solution. Delta VFD-M series AC Motor Drive came along and satisfied their needs, and we sold 1,500 VFD-M series AMD treadmill manufacturers and 500 to industrial automation washing machine manufacturers every month to at that time. The sales result was a great encouragement.”
Development is Never Easy
However, Delta IA Korea faced a channel problem in 2003 due to unstable market situation. William said, “It was a very hard time for Delta IA and our customers as well.” As a result, Delta IA Korea rearranged market from 2004 to 2005, and Delta IA officially joined Delta Korea branch official branch office in Seoul then. In 2006, William joined Delta IA Korea. “I joined Delta IA Korea in 2006, and our sales amount grew up and reached USD$5 million in 2007. The market share continuously expanded in 2008. Everything went well until the economic tsunami attacked Korea in Q3, 2008.” said William.
Since Q3 in 2008, KRW depreciated around 60% because of the serious depression, and unfortunately, 2 out of 3 Korean distributors gave up Delta business. The situation was terrible, but William sees a better future in 2010. He said, “Our current distributor and dealers have strong intention to work with Delta, so I am confident that we can recover our sales within the shortest time. What's more, a new FAE (Field Application Engineer) just joined Delta IA Korea to support our channels and the technology for high-end market.“
Know Yourself, Win the Future
William understands that he is facing a difficult market where consumers worship Japanese and European industrial automation products, but he is also confident that Delta IA will survive and grow with excellent products and better technical supports, especially with CPFR (Delta Collaborative Product Forecasting and Replenishment). William said, “CPFR will surely reduce the long delivery time; and if we keep on promoting Delta brand, I'm sure we can expand our market share in Korean industrial automation market!”
For more information, please go to:
Delta Electronics
Delta IA Korea
Delta Electronics' Industrial Automation Products
Delta IA Korea Regional Manager: Mr. William Lee
Delta Korea Team