Entrepreneur Jim Thompson founded Crown Worldwide in 1965 with an initial investment of just 1,000 USD and took it to a turnover of 840m USD in 50 years. Launched in Yokohama, Japan, it is now one of the world’s largest privately-owned companies in the field of international logistics and related services with 265 offices in almost 60 countries, including the UK.
His company proved to be ahead of the business curve – with globalisation now seen as key to building a successful business in the modern world. Here he shares his experience, business tips and predictions as Crown Worldwide moves into its 51st year.
By Jim Thompson, Chairman and founder of Crown Worldwide,
I’m often asked what the ‘secret’ is to building a business that last 50 years and it’s a difficult one to answer because there are so many aspects to discuss.
In my experience it has been largely down to hard work and perseverance, getting the right team in place, sticking to the business you know best and doing it an extremely positive way.
But there’s another aspect which has helped Crown flourish and that’s our determination to take a global view of business. As a company born in Japan and first grown in Asia there’s always been a willingness, in fact an ambition, to embrace and learn from other cultures, other ways of doing things and other business environments.
To go from one small office – in fact it was more of a cubicle than an office really – in Yokohama to a worldwide presence has been an interesting ride but it is also what has come to define the company.
The global nature of business today means it’s now fairly normal for all sizes of companies to have international operations; so it’s becoming an important part of growing a business. Any company which neglects the global nature of the business world today would be making a mistake – and fortunately for Crown we were ahead of the curve.
When we discuss the culture of the company today one of the main positives for the customer is that we are able to offer an end to end service – there are Crown offices all over the world. That, together with the fact we have been able to remain a privately-owned business, has enabled Crown to have a real identity that we hope makes it both an attractive place to work and an attractive place to do business.
It’s Asia’s Century
We were very lucky to start our business in Japan and expand quickly into China – and even now Asia is a core region. In fact the company is headquartered in Hong Kong and I spend most of my time there.
I’ve often said that this is Asia’s century and I see no reason to change that opinion despite recent economic blips.
The stock market crash in Shanghai in June-August 2015 made big news, together with another steep sell-off in January 2016. But I think it needs to be put into perspective. China has become such a huge economy that any dip is bound to have a global effect, causing other countries to slow down. But it will bounce back in the next year or two and resume its growth path.
From Crown Worldwide’s point of view, Asia continues to be our most successful and profitable area of the world by a long distance. We will continue to invest actively in Asia well into the future.
In my view, China is actually managing the economy, which was getting overheated in recent years. There was a huge number of speculators jumping into the property and share market and I feel the leaders of the country decided to manage the slowdown rather than let the economy crash.
I’m very positive about the future for business in China and Asia. Sixty percent of the population of the world is here and when you think of the number of items that we use which are manufactured in Asia, it is staggering.
I’ve read a lot of stories and commentaries on whether companies should continue to invest in the region but for me that’s the wrong angle.
The bigger question is why companies would not see China as an important place to do business. With the population it has and the growing wealth of the middle class it is now both a big manufacturing country and a huge market for products and services of companies from other countries.
There is a move from the manufacture of low value items such as T-shirts and toys to more high value items such as electronics and machinery as the cost of labour increases. But with the increase in productivity and even the use of robots going forward, China is going to be great place to do business and a very hard place to ignore
The world is getting smaller all the time in business terms and companies without a global presence are at a disadvantage.
It’s been a great region for a service business like ours because the Asian communities are very service conscious and the people are smart and very hard workers.
Now I firmly believe more businesses are seeing that and they’ll see growth in this region in the coming years. There’s a lot of different countries and cultures but it’s a big place to do business with well over half the world’s population. We’ve been the beneficiary of that as people have moved in and out and we’ve continually solidified our position in that part of the world.
The world is going global
The pace of globalisation in the business world is picking and there aren’t many places in the world now where you feel the market is a complete no-go.
In terms of Asia it’s been interesting to see the number of European and American companies, in fact businesses from all western countries, which have finally said ‘we have to be there, we’re going to be part of it’.
All types of companies from trading companies to manufacturing companies to service business are expanding globally and it has certainly been important for Crown Worldwide. I think a company like ours must be global and serve people all over the world because that’s what our clients want – they want global suppliers who can have a common service in all the places they are located.
Of course that doesn’t mean that expanding into new territories is always easy. Every country has cultural differences and there’s no question that you have to be aware of those. Each country has its own laws and some of them seem very strange but you have to comply with them.
I would suggest the mistake some businesses make is they think ‘we’ll do business the same way in Indonesia as we do it in New York or London’ and that doesn’t work. You have to understand how things work in all those different countries and adapt to that local system of doing business. Most successful companies have worked very hard at understanding how to do business in other parts of the world, whether it be Asia, South America or Africa. They try to adapt their business model to comply to the local situation as much as they can.
But it’s really not that hard. There are language and cultural differences of course but in large parts of Asia – places like Malaysia, Singapore and Hong Kong – the laws follow the English Common Law that we’d be very familiar with in the West. They have built their models of operating to western standards but with some Asian features.
Generally it’s easy to adapt to them once you get there. I think a lot of people live in fear of what it would be like doing business in India for example but when you get to India you can figure it out pretty quickly and you can make your business work there.
Every country has their own little differences and of course there are risks in some areas as well, not just business risks but personal risks even. I remember we operated in Iran and when the revolution came we had to get out – but that’s just part of international business. The positives far outweigh the negatives.
What’s interesting, too, is that the rise of the internet has transformed international communication. It has made it commercially viable to manage a global business and even made it possible for smaller companies to operate globally – we’re seeing that more and more.
Whether those smaller companies are able to truly understand the cultural nuances and challenges of working in different regions will be interesting to see, but certainly the thirst for international business and globalisation is very real. To be a big business these days you can afford to close your mind to international markets.
BOX-OUT: Top Tips For Growing A Global Business
1 Be prepared to stick it out
My biggest tip for any entrepreneur growing a business is be prepared for a bumpy ride and be prepared to stick with it. A modern entrepreneur should ready to deal with all the obstacles that come their way because it is rarely ever a smooth ride. You have to be the type of person that will persevere and push through all of those challenges.
I remember when we first started and it was a fragile business – like all start-ups probably are – we were always worried about whether we had enough money to pay bills and whether we were doing the job right. You have to cope with all the ups and the downs.
2 Know your core values
It’s important to believe in what you do and the way you do it. It is easy to think core values are something you only worry about when the business is already successful. But in fact the reverse is true – core values are what make you successful in the first place. Having respect for the people who work for you, believing in doing a good job in the right way, giving the customer a good experience, communicating with people, giving something back to society – all these things are critical. Do things the right way and you’ll have a better chance of success.
3 Get the right team in place
Successful business is all about people. Getting the right team is what makes a business work and learning how to delegate is important too. Passing on jobs to other people gives you a lot more time to do other things – and you soon realise others can often do things better than you in many cases! I think that in many young companies, the individual who starts that business feels they have to everything themselves; and that’s a mistake.
4 Don’t be tempted to sell too early
It’s different for everyone of course but my advice is to retain ownership of your business if you can – don’t give it away or sell too early. So many entrepreneurs today say ‘I’m going to run it for five years then sell it’. But I don’t think that’s a true entrepreneur – that’s almost a speculator in my view.
I almost sold once in the early part of the company’s history. I had an offer on the table but had a change of heart and walked away, and it was the smartest thing I ever did.
5 Don’t underestimate cultural differences when expanding abroad
Every country has cultural differences and nuances and you have to be aware of them. It’s too tempting to say ‘we’ll do business the same way in China as we do it in London’. It doesn’t work. You have to adapt.
6 Employ staff that understand the language & culture
Language differences in a place like mainland China, Japan and some other countries can be an issue. So you need to ensure that some of your staff really understand both the language as well as the culture, including the local practices.
7 Have a ‘can do’ attitude
A lot of people get hung up on the idea that setting up somewhere different is going to be extremely complicated and difficult. But of the laws are very familiar and it’s not as difficult as you think. People live in fear of starting business in India or Brazil but when you get there you can figure it out pretty quickly and you can make your business work there.
8 Don’t ignore the Asian market
My experience is that we’re starting now to see significant interest from companies who want to expand in Asia and are looking at the market. That doesn’t surprise me because from my perspective it’s the exciting part of the world going forward in terms of prosperity and opportunity.