• Designs on the future – COMPANY PROFILE
Benoy has found a good modus operandi for doing business in China — as an international design group working alongside local architects and design companies. This approach has proved very successful and secured the company the Queen’s Award for Enterprise last month. The company’s founder, Graham Cartledge, was also awarded the CBE in the Queen’s Birthday Honours list. Humphrey Keenlyside writes.

A continuing construction boom. Rapidly changing city-scapes. Growing prosperity, with people willing to spend more. No wonder Benoy, which has made its name designing retail developments, sees huge potential in the China market.

The company, which was founded in Nottinghamshire in 1947, has risen to become an organisation of some 500 people working in offices in the UK, Abu Dhabi, Hong Kong, Singapore and Shanghai.

Whilst specialising in retail design, Benoy’s remit embraces a range of work — increasingly falling under the umbrella of ‘mixed-use’, including airports, commercial, hospitality, leisure, residential and transportation.

This worked well in Hong Kong, but it was clear that there might be opportunities on the mainland. The question was, what market exactly? China has its own architects, designers and a huge construction industry. That is true says Graham Cartledge, the chairman, but there is still a need for international design and architectural skills.

China also lacks the diverse spread of developments, and in particular mixed-use developments — combining office space, retail space and residential accommodation — in which Benoy specialises. “Our calling card is retail projects, plus associated residential and office use space,” explains Simon Blore, who heads up the Hong Kong office. “We are viewed as experts in this particular field.”

There were three groups of potential clients, as Benoy ana-lysed its prospects: Hong Kong developers; international developers; and, eventually, local Chinese developers. As it happened, that last sector of the market has changed much more rapidly, and advanced quicker than Benoy had anticipated. “Just within the past five years, you are seeing the emergence of local property developers who are making an impact,” says Graham Cartledge.

Pins on a map
In a country as big as China, how do you know where to start? The answer was simple but logical — wherever Dragonair flew in China from Hong Kong. The second- and third-tier cities, to which Dragonair flies, are large cities in their own right, and also looking to develop and modernise. It made sense to target some of these cities early on in their planning.

There have been plenty of openings, but Benoy has approached the market with due caution. Projects are only taken on with developers whom they know or to whom they are recommended. In the early stages, that took time and patience; today, it is easier to carry out due diligence.

Secondly, the company did not underprice its services — and, in effect, the company offers design and architectural consultancy, working in collaboration with local designers and architects — simply to get into the market or to win market share. Each project had to be profitable.

And, thirdly, it did not expose itself to the risk of not being paid. There are strict mileposts, against which payments are made. “If we are not paid as agreed, then we simply withdraw until we are,” says Graham Cartledge.

Another element of caution is exercised when it comes to intellectual property. Although Benoy is selling ideas, which are not capable of being protected, its designs are easily capable of being copied.

Benoy has developed its business rapidly in China. The company now has some 30 projects on the go, taking on hotel towers and office developments, as well as mixed-use developments (see box, opposite page, for examples).

The key to the success is marrying international design skills with local requirements and preferences. “You cannot simply import a model from Europe,” says Simon Blore. “You have to design projects that fit into the local environment and, particularly, are what people want. That requires careful analysis.”

He also points out the wisdom of being respectful at all times. Establishing trust is vital. “We always say who we are and that we wish to engage with our clients, not simply come up with a blueprint and a take-it-or-leave-it attitude.”

Charitable initiative
It is not all business. The company has a charitable arm, called the Benoy Foundation, which supports projects in the countries in which it has operations. The Foundation was on the verge of launching an initiative to support the so-called ‘stay-behind children’ (those who are left in their home towns while their parents move to the coast to get work), but the earthquake on 12th May has put that on hold.

Instead, the Foundation is helping orphans in Maoxian (near the epicentre of the quake) currently living in tents as a result of their orphanage being destroyed by the earthquake. The charity is also supporting new orphans who lost their parents in the disaster.

The Foundation is working in partnership with the British Consulate-General and
the Wanzhou Association for Social and Cultural Promotion.

In developing its business this approach has helped the company to evolve from being perceived as a European company to an Asian company. This is partly reinforced by having local staff, of which there are now eight in the Shanghai office. The aim is to have an office of 100 in a couple of years’ time.

Another facet of the business development has been to form and then cultivate relationships with Chinese developers who may be taking on new projects overseas.

Marketing has paid off. With involvement in projects comes a track record and then a reputation. In the early stages, Benoy made all the running, but now the company says it is receiving unsolicited approaches from developers.

The next steps
If all this sounds too easy, it is not. Benoy has had to work hard to establish a foothold in the China market. As other businesses have discovered, operating in the China environment requires flexibility and adaptability, as well as much patience. Projects undergo regular change, as they develop, and Benoy has on occasion had to call the shots when it comes to insisting on maintaining quality standards.

But, as Graham Cartledge explains, the sector is working in their favour, as standards in construction technology continue to improve all the time. “There is no comparison with five years ago, and I am sure that in five years’ time there will be a similar leap. The market is maturing.”

The next step for Benoy is to move up from having a representative office to setting up its own wholly foreign-owned enterprise.

Benoy’s advice for others entering the China market:

1. Look hard at what you are selling. China has everything in the thousands, so research carefully whether what you have to sell will find a market.

2. Take time to study the competition. China is now not one market but many, and you may find that others are targetting your niche market in the same way that you are. Emphasise your difference to them.

3. Think what is in it for the other side. Knowledge transfer, technology and other benefits are all welcomed by China.

4. Take on Chinese staff and invest in
their training. This not only makes good commercial sense, it also, demonstrates your commitment to the market. Paradoxically, you may need to retain a European figurehead.

5. Work hard to make sure the company ethos is replicated in China.

Projects in China
China World, Beijing: Benoy has been hired as the retail architect, interior and graphic designer of the extension to China World, to create a tower that will be the biggest to date in Beijing. It will contain a six-level retail podium.

The Hang Lung, Shenyang: This is a retail project near to the Imperial Palace, and will capture some of the features of Qing Dynasty architecture. There are to be two zones around a central open area, which will be suitable for public gatherings and concerts.

Huai Hai Zhong Lu, Shanghai: Benoy is responsible for the entire external wall design, retail planning and retail interior design for Sun Hung Kai, the property developer (image, opposite). The scheme encompasses two commercial towers which lead to a seven-storey retail podium and adjacent residential towers.