Opening doors to new markets
Dortek is one of many Enterprise Ireland supported companies that has shown how a strong position in the UK combined with market diversification can drive growth.
Headquartered in Wicklow Town, Dortek is a prime example of an Irish company which has balanced building up a significant presence in the UK with expansion into other international markets – a track record which will stand to the company in the post-Brexit era.
“Our strategy is fairly simple – to maximise sales in the UK and maximise sales outside the UK,” says CEO of Dortek Alan O’Keane. “We are not negative about the UK at all. In fact we’re quite bullish. One way of responding to a tightening economy and currency fluctuation is to really go for it.”
Dortek designs and manufactures customised hygienic doors for use in complex environments such as cleanrooms, laboratories and operating theatres. Resistant to bacteria, its doors are made of composite plastics, are completely seamless and inorganic and will not swell, rot or rust.
When the company was founded 50 years ago by Stephen O’Mara it concentrated initially on the Irish market and the pharmaceutical sector in particular.
Securing contracts with global pharmaceutical companies with operations in Ireland led to Dortek following its customers into other markets, starting with the UK. It found an agent in Hull in the 1970s, and went on to set up an office there in 1989 where it took on its first employees outside Ireland.
“The UK has always been a great market for us and was an obvious starting place for exports. We have found it very straightforward and receptive to Irish companies,” says O’Keane.
“It is not a complicated market. If you have a good product and value proposition, the price is competitive and you keep your promises, you will do well in the UK.”
Ten years ago 80% of Dortek’s business was in the UK and 20% in Ireland. Turnover has grown threefold since then, to around €18m in 2016. The UK now accounts for about 50% of the total, with Ireland making up 10% and the rest of Europe, the US and Asia combined making up the remainder.
“Having close relationships with our customers in the pharmaceutical sector has allowed us to enter most new markets. Generally if we do well in that sector in any given country, we then diversify into the healthcare, nutrition, food and retail sectors,” O’Keane explains.
“We work in a conversion market. When we go into a country, there is always a door being used in a way a customer is happy with. We have to convert them by showing the benefits of our type of door.
“A key differentiator for us is the fact that we can supply the same door virtually anywhere in the world as it will have achieved fire certification in so many different countries. Our experience and expertise having worked on thousands of projects internationally is also hugely important.”
Dortek’s doors are chosen by the top 20 pharmaceutical companies, all the world’s leading nutritional companies and five of the world’s largest food companies. Its solutions have been used extensively in major retail chains across the world.
Boots on the ground
According to Marina Dohohoe, director UK and Northern Europe at Enterprise Ireland, the fact that Dortek has committed time, people and resources to new markets has been instrumental in driving its growth and success.
“Dortek is a well established and experienced company which had the ambition to look beyond Ireland and the UK and work with existing customers in those markets to get into others,” she says.
“However, it hasn’t just thought opportunistically and grown with its customers. It has put boots on the ground in new markets, acquired the necessary language skills and gained an appreciation for the local business culture.
“The fact that it can reference international clients and has a strong presence in the UK has given the company credibility when targeting new markets and customers.”
Enterprise Ireland has worked closely with Dortek on its market diversification strategy, particularly in the past seven years. It has helped the company to see the potential to scale in various markets through local support and to focus on developing its sales pipeline for exports.
Dortek now employs a total of 135 people across its six physical locations – in Ireland, the UK, the US, Singapore, Malaysia and New Zealand. Forty five people are employed at its subsidiary in Hull and there are 35 people on the ground in Asia, further to Dortek entering the region in 2007.
O’Keane notes that the ability to meet potential customers in their own country and follow up locally once business is secured has been crucial. “Our people will generally go to a site, meet the client and often measure up to ensure we have we understood their requirements when placing orders.
“Then when the doors are made, we will make sure they are installed properly. The risk is ours, not the end-user’s – if anything goes wrong it is because we didn’t ask the right questions.”
Regardless of Brexit, there are always ways for Irish companies that manufacture a customised product to compete in the UK and around the world, O’Keane believes.
“All we can control when it comes to Brexit is how we respond. It has made it more important to focus on different niches and slices of the market and look more closely at how we differentiate our product, service and delivery.”
Tips on expansion outside the UK
Alan O’Keane, CEO of Dortek, shares some of his insights on how to leverage success in Ireland and the UK in other international markets
• Whatever customers you are selling to, understand why they buy from you. Try to identify others with the same problems that would value your solution in the same way. You have to know what differentiates your offering and what the local competition is in any new market.
• Apart from the quality of our product offering, Dortek’s skill in recruiting talented people has been crucial. We have fantastic staff retention – great people join us and tend to stay. The people we have out front dealing with customers are technically skilled, willing to travel, energetic and good communicators. They also recognise how important it is to respond to customers and keep their promises – if you don’t keep your promises in the early days in new markets you will be absolutely sunk.
• We have found building on relationships and using customers as stepping stones into new markets to be an effective growth strategy. To mention to a prospect that you were given their name by one of their colleagues really makes a difference.
• Once we have entered a new market, we are thinking of getting into another and assessing the potential of converting companies there from timber and steel to our hygienic doors. But we will never bet the farm on a new market. Some companies can afford to go in big. But, we have always started small, used our money wisely and then if we get significant orders, used that money to finance expansion.
This article is part of a series published as part of Enterprise Ireland’s Global Ambition campaign.To find out more about how companies can approach market diversification and prepare for Brexit go to https://ambition.enterprise-ireland.com/