In for the long haul
Location near port helps draw Chinese manufacturer to Suffolk
- January 29, 2014
Grandwatt Electric Corp. plant manager Tom Baise sees meaning in the old adage “slow boat to China.” That’s because it’s a long haul in getting shipments from the firm’s parent company, Superwatt Power International in China. “If a customer calls and wants to buy 10 lighting towers, for example, and we get them from our parent company, the soonest we can have them is 60 days because of the boat ride port to port,” Baise says.
Headquartered on a 6.7-acre site in the Suffolk Industrial Park, Grandwatt Electric is new to the United States. The company was incorporated in November 2012. Baise was hired last March. “We currently have a staff of 10, and we are now hiring staff,” he says.
Grandwatt is a build-to-order original equipment manufacturer (OEM) of lighting towers and power generators. Products range from six-kilowatt to eight-megawatt, for residential, commercial and industrial prime and standby power for generators. The Suffolk plant began assembling products last August in the company’s 30,000-square-foot facility. The company hopes to complete a $10 million expansion during the next three years and add 50 jobs. “The expansion will be based on projections,” Baise says.
So far, the company is optimistic. It had a good showing at the Power Generation Show in Orlando last year. “We did really well,” Baise says.
The new company is the result of Superwatt’s desire to open a firm in the U.S. that could compete in the North American market. “The president looked at North Carolina and Virginia, and he chose Virginia because of the location [near] the ports in Hampton Roads,” Baise says.
Another plus: The Suffolk warehouse met the company’s special needs. It was equipped with two 10-ton bridge cranes with dual five-ton hoists. “The overhead cranes travel the length of the warehouse. Each is rated at 20,000 pounds,” Baise says. “We can offload trucks, assemble the components and move the generator into the warehouse and then back into the truck.”
The company’s products are sold to local government agencies, rental companies, heavy construction companies and the mining industry. The business affords the company sales opportunities in Africa, Australia, Argentina and Brazil. The company has done particularly well in mining. “Mining is a lot of money,” Baise says. “Our products are used by all kinds of mining — gold, diamonds, silver, copper and coal.”
Grandwatt’s sales manager recently traveled to Argentina and Brazil. “That is a very up-and-coming area for possible sales,” Baise says, adding that the only drawback is that both countries often have conflicts in their governments. “You have to be careful when you deal internationally. You have to look at different credit insurances. Underwriters are looking at the [local] economy to see any fluctuations.”
The company has a strong international presence because of its parent company’s long history of global sales. Grandwatt is currently selling to more than 60 countries. Regionally it sells to the state of North Carolina and local rental companies in the Hampton Roads area. “We would like to establish something on the East Coast,” Baise says of the company’s sales. “We want to get our name out there, but it looks like it will happen internationally before it does locally.”
Products manufactured in Suffolk are of a higher quality than the products made in China. “We have to meet quality demands. People globally are looking for U.S. standards because they are better quality,” Baise says.
The company is currently working on a Foreign Trade Zone certificate and becoming acquainted with domestic EPA restrictions. “I can’t sell certain types of diesel engines in the U.S. because of EPA regulations, but I can sell them internationally,” Baise says.
He finds the services of local economic development offices in different countries very helpful when it comes to international sales. “We establish a relationship with them,” Baise says of the offices. “They put us in touch with another company that sets up contacts so when our salesman goes there the appointments are already set up. It has a cost associated with it, but it’s well worth it. It’s better than cold knocking on someone’s door in a third-world country.”
The service comes with an interpreter who accompanies the salesperson. “That is much appreciated,” Baise says.
The company is setting up global distributorships. “One of the first things I ask is, ‘Are you going to have the ability to provide service?’” Baise says. “We don’t want to do business with somebody who can’t back up the product with service.”
Grandwatt’s parent company has two factories in China — one in Huizhou and one in Shandong — in addition to its Shenzhen headquarters. When Baise started dealing with the factories, there were some language barriers to overcome. “It has gotten a lot better,” he says, noting that most Chinese people can read English even if they can’t speak it. “We can communicate without saying anything.”
Baise has become accustomed to the business culture in China. For example, when he presents his business card, he turns it around so it is facing the person he is handing it to. “I hold it at the ends with two hands and present it to him,” Baise says. “He will read it front to back.”
He’s also learned that he must toast each individual dignitary at the table during a business dinner. Last September when Superwatt celebrated its 20th anniversary, he headed one of the 54 tables in the hotel conference room. Each of the tables had to be toasted individually. “It’s very tasteful and very traditional,” Baise says.
The Chinese, he adds, always treat him with the “utmost respect. They won’t let me buy anything; they buy it for me. They love Americans.”
ECONOMY IN SUFFOLK
Suffolk’s target markets include advanced warehousing, manufacturing, medical, modeling and simulation technologies, retail, hospitality, office administration and food and beverage processing. The military accounts for two of the area’s largest employers — the Navy Cyber Command and the Joint Forces J7 Staff. The city of Suffolk, Sentara Obici Hospital and QVC Distribution rank as some of the largest employers as well. Last year Planters Peanuts celebrated its 100th year in Suffolk. The city recently competed globally to keep the Lipton Tea Co. in the area after 58 years of service. The company’s plant manufactures 6 billion tea bags a year. Lipton will invest $96 million in new equipment as part of the Lipton Tea Reinvestment plan.
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ECONOMY IN HUIZHOU, CHINA
Located in the Guangdong province, Huizhou is a center for the petrochemical industry as well as information technology and exports. Large companies include electronics company TCL Corp.; Viasystems, which makes complex, printed circuit boards; and the electronics company Desay. Huizhou has an economic and technology development zone, which includes companies involved in automobile assembly and electronics manufacturing. It also is home to an export processing zone and a high-tech industrial development zone with companies such as Sony, Coca-Cola and electronics powerhouse Siemens.