Don't Just Sell to Overseas Clients—Collaborate

The unique approach that won a Canadian SME new clients and new partners in the competitive South African market

Written by Victoria Foote

About three years ago, ComplyWorks—a $5.7 million-a-year Calgary company that helps resources firms evaluate the performance of their subcontractors—was presented with the opportunity to expand into Africa.

Most of the fast-growing company’s customers were based in North America at the time, primarily in the oil and gas industry. Even so, when Lonmin, a global mining company, asked ComplyWorks to take on a pilot project in South Africa, recalls Cal Fairbanks, ComplyWorks’ president and CEO, he wasn’t all that surprised.

ComplyWorks (ranked No. 220 on the PROFIT 500) had carved out an innovative niche for itself in the energy field. The company got its start in 2004 in assessing prospective subcontractors on their regulatory compliance records, an effective tool for large resources firms that need to screen bidders on complicated projects.

As ComplyWorks became better known, the company started working with clients on issues around suppliers and contract compliance, as well as on a supplier’s interaction with the client’s key departments. Over time, ComplyWorks expanded its customer base to include sectors such as telecommunications, forestry, utilities and building management. (ComplyWorks earns its revenue through subscription fees paid by suppliers and contractors, which sign up to have their compliance and regulatory processes vetted by ComplyWorks, as well as from retainers paid by its customers.)

When Lonmin came calling, ComplyWorks was ready. In a model that also has proven to be successful with subsequent customers, ComplyWorks provided its services to Lonmin on a trial basis within a fixed time frame. The partnership flourished, and ComplyWorks began to consider establishing satellite offices in South Africa.

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The question was how to line up enough new clients in South Africa’s mining sector to make the investment worthwhile. ComplyWorks followed a strategy that sometimes contradicts traditional advice about how to break into a new market.

Fairbanks explains that his firm bypassed the textbook approach to do a high-level economic analysis of a target market: “What we want is real practicality.” Fairbanks sent a team of senior managers to visit prospective customers in South Africa to gauge demand from resources and mining businesses already operating in that region.

“We would send in a team to do research on the potential return on investment in that market,” Fairbanks says, “and come up with a way to capitalize on that market to see if it makes sense.”

During those research forays, ComplyWorks reps outlined the strategy behind the company’s service and the prospective benefits to customers. The reps also wanted feedback about local practices. “What we were after was a vision match,” says Fairbanks. “We didn’t position [those meetings] as sales calls.”

That outreach also required ComplyWorks to drop in on its competitors, offering pilot project-type partnerships. By 2011, ComplyWorks felt it had identified enough critical mass to justify the decision to open a field office in Pretoria, South Africa.

The approach of taking on pilot projects with strategically important clients has yielded benefits. After working with Lonmin’s subcontractors and building a network of contacts in the African mining world, Fairbanks says, ComplyWorks won over a very large client with significant African operations—Glencore (now GlencoreXstrata), one of the world’s biggest diversified resources companies.

These days, ComplyWorks is expanding its operations into Eastern Canada via new partnerships with Quebec firms. But Fairbanks believes the cautious growth strategy that allowed ComplyWorks to enter the South African market will be the same approach the company will take in other geographical regions, such as Australia with its rich resources sector. As Fairbanks asks prospective clients: “If we came here, will you guys be early adopters?”

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