Editor’s note: Read more about Georgia’s ties with Japan at www.globalatlanta.com/japanreport.
On paper, there’s no real reason Japan shouldn’t be one of Purafil Inc.‘s top Asian markets.
The Doraville-based manufacturer of air filtration systems does business in 60 countries, with exports making up 65 percent of its sales. Taiwan and Australia are its largest markets in Asia, with China gaining rapidly thanks to an aggressive expansion plan there.
Japan is replete with facilities – paper mills, steel mills, refineries, data centers and other factories – that need Purafil’s products. And the company’s customers include some of the country’s biggest names in electronics, like Yokogawa and Toshiba.
For most of the last 22 years, though, Purafil has taken a hands-off approach in Japan, managing its business there through one main distributor who preferred little direct interaction. While the partnership hasn’t been acrimonious, it also hasn’t been as transparent as company leaders would have liked.
“Of all the countries in the world that we do business in, we never felt that we were able to benefit our local representative with open communications,” said Jim Mash, the company’s president and CEO.
But all that has to change if the 40-year-old company is to realize its aggressive plan to boost Japan sales at least by 68 percent over the next five years, company leaders said.
On May 13, Purafil convened a group of local leaders at its office and factory complex off Buford Highway to ask for help in this effort.
Japanese Consul General Takuji Hanatani was asked to help improve communication with Japanese customers and distributors. Representatives from the local offices of the U.S. Commercial Service, the Georgia Department of Economic Development and the Japan External Trade Organization offered to help find qualified personnel and break through to decision-makers at top Japanese companies.
Purafil began to revamp its Japan strategy in 2007, its best year ever in the country. Keeping ties with its longtime distributor in the high-tech sector, Purafil hired another to target industrial plants.
Company leaders decided they would start traveling to Japan two or three times a year instead of once every two years, said Andy Weiller, Purafil’s Asia director.
Later in 2007, though, the global financial crisis hit, kick-starting a recession that put a dent in electronics sales. Nearly all of Purafil’s Japanese customers were factories using its filtration systems to keep the metal on the electronics from corroding. Japan sales plummeted by 61 percent that year.
“The first thing companies do in a recession is stop buying computers,” Mr. Weiller said.
Over the last few years, sales have started to recover, but Purafil isn’t content simply to gain back what it lost. With a localized approach and contacts, the company could potentially quadruple its sales there, Mr. Weiller said.
The company will soon hire a full-time Japanese sales manager to run its business in the country, hoping to overcome challenges posed by the 13-hour time difference and language barrier.
Noting that Japan is “open for business,” Mr. Hanatani seemed puzzled by the company’s frustration in the market thus far.
When he asked about Purafil’s main competitors in Japan, Mr. Weiller noted that the biggest hurdle isn’t another company, but ignorance about the benefits of its products, a problem he admitted could only be solved through better marketing.
Purafil makes filtration systems at some 10 factories around the world, but its main business is in refilling the chemical “media” that go into the filters in these machines.
“We’re a chemical company. We’re in business to make chemicals,” Mr. Mash said.
Purafil’s systems draw air through filters packed with black or purple pellets that absorb harmful, corrosive or foul-smelling particles. These chemical pellets – mixed and baked by a technician with 30 years of experience at the Doraville factory – come in 12 varieties that can target specific gases for removal.
While mostly used in industrial settings, Purafil’s products also protect archives and art works from air pollution. They’re used in settings from the Sistine Chapel to the Smithsonian and the Shanghai Museum.
Changes in the way electronics are manufactured have opened even more opportunities. In 2007, countries agreed to ban heavy metals like cadmium, lead and mercury in production. When devices ended up in landfills, the metals were leaching into the water table, posing health risks to nearby communities.
Companies began to substitute lighter metals like tin, copper and silver. While cheaper, these were also more susceptible to corrosion.
Purafil’s systems stave off such damage, extending the life of servers, semiconductors and computers and helping protect the data they contain. Data centers are one of the company’s newest target markets.
Before leaving, Mr. Hanatani thanked Purafil for doing business in his country during its time of need. After the March 11 earthquake and tsunami and the ensuing nuclear crisis, many foreigners evacuated, and tourists and businesspeople stopped coming, he said.
“Please do come visit Japan; do business in Japan. That’s the most effective support,” he said.
Mr. Weiller said Purafil is ready to oblige.
“We hope to do a lot of business in Japan,” he replied.
Read more about Georgia’s ties with Japan at www.globalatlanta.com/japanreport.