EP Exotic Plant's main products are Bromelias. "As well as this we also do some Calathea, Musa Tropicana, Phaleanopsys, Anthuriums and other sorts. After propagation in Shanghai, these young plants are shipped to growers in Australia, USA, Thailand, Korea, Japan and Europe."
"It all started with the realization of a 15,000 square meter greenhouse in Shanghai and a 3,000 square meter high tech lab," Somnel said. "All of our greenhouses are computer controlled and build according to European standards. Because of the good pay off, we expanded with another 8,000 square meter greenhouse." EP opted for Shanghai because of the good location, the good climate and the positive support from the local authorities.
Local government
Somnel: "EP-Exotic Plant Shanghai Co., Ltd. has been build by the local Government of Langxia - Jinshan (also Shanghai City) with a total investment of over € 5,000,000. According to the Letter of Intend, EP agreed to pay back a yearly lease-back of 8% for the investments from greenhouses, lab, boiler house, electricity house, 8 apartments, storage room and guard house. Which is quite less than the 5 million previously mentioned. Land lease we pay according to the local calculations of profits of rice. So the farmers don't loose money by us taking their land. Most of the farmers of this land, do work in our company, a requirement of the Government of Langxia."
Greenhouse technology
The controls of the climate computers are accessible from any location in the world. The inside temperature is kept between 20-30 degrees Celsius. The humidity is somewhere in between 60% and 90% RH. The greenhouses are also equipped with three screen systems for light and energy savings. Next to this there is ventilation equipment, a heating system that runs on coal and a pad and fan cooling system. "We planned to switch to natural gas system in the near future, from a sustainable and environmental point of view," Somnel said. "Sustainability is becoming more and more important. That's why we have also build special rainwater storage systems, to shrink the usage of tap water."
Within a short time after setting up the first operations, the company's turnover in China increased from 370,000 Euro to more then 4.3 million Euro. Their market share in China went from 45% to 80%.
"Since then the production in Belgium is only focused on customers in Holland, Italy and Belgium. The young plants from Shanghai are being further propagated in Belgium as market ready young plants. R&D and selection of new varieties is still being conducted in Belgium.
Looking back
Looking back on starting up the Chinese operations, winning a market share was the biggest challenge, Somnel said. "You can only do that by supplying the highest quality against the right price. Next to that the start up was a lot of paperwork.Nowadays challenges are the economical situation in Europe and the slower growing Chinese economy. "Just like in Europe, we really have to focus in delivering high quality against the best prices and a good communication and support to our customers. Otherwise you won't survive, not even here. Our customers are growers, and we are also focusing more and more on supporting them with knowledge and a good, intensive accompaniment in their crop strategies."
The Chinese social security is on the rise. "Minimum wages are increasing very quickly," said Somnel. "This is another challenge we have to deal with, since we have around 240 employees in our operations in Shanghai. These increases are not always being communicated very well. Usually a statement is made in the newspapers, and you just have to deal with it."
Your home is where you live
When asked if he has got more ambition to break open new markets or expanding market share, Somnel is quite confident: "I have enough ambition, and there is a wide world out there full of chances. I see possibilities to break open markets in USA, New Zealand, Russia, South America, India and Saudi Arabia. Only there are not so many more places left that offer a good chance to start up a new young plant nursery. I think the USA is the only place where you would survive due to the good local market.""Nonetheless, I would never go back to Belgium. I think the working atmosphere throughout Europe is spoiled by the non-necessary stress and unnecessary meetings. There are plenty of places in the world where I would like to work. I always think: "Your home is where you live!"
For more information:
EP-Exotic Plant Shanghai Co ,. Ltd (Website)
Erik Somnel
[email protected]
