Home' MHD Supply Chain Solutions : MHD Spt-Oct 2015 Contents Now and into the future
SmartTrans is working hard to deliver
to its ASX shareholders, who expect
us to maximise the return from the
technology being developed.
The principals' vision is to retain
the Australian base as a technical
'centre of excellence' and to expand
the application of that technology
beyond Australia's borders, with a view to signifi-
cantly growing the customer base.
In the short term, our entrenched presence
and credibility in China means that it is the ideal
gateway for us to expand our logistics technolo-
gy into the Asia Pacific market, which will facili-
tate exponential growth for the organisation.
SmartTrans is already an international organisa-
tion that is a net exporter of technology, which is
the reverse compared to most technology within
the logistics industry in Australia. We have diversi-
fied our technology to include payment gateways
in China, in addition to the logistics product.
The third generation of our logistics technol-
ogy is now complete, which allows us to offer
smart, responsive and reactive technology to
organisations looking to have greater control and
visibility of their field personnel and assets.
While the sheer market size and rapid growth of
the Chinese market were of course strong draw-
cards that were aligned with company objectives,
SmartTrans' entrance into the Chinese market
coincided with a specific opportunity, that is,
to apply technology that was developed for the
Sydney 2000 Olympic games, to the Beijing
Olympics in 2008. The application of SmartTrans'
Event Track for the Olympics
enabled the company to estab-
lish a presence and credibility in
During that process we estab-
lished relationships with the two
major telecommunications pro-
viders, which in turn opened the
door for the development of the
payment gateway platform that enables e-com-
merce transactions via a mobile phone.
The success of this technology can be judged
by the fact that SmartTrans has just reported 1.2
million users having transacted on this platform
in the month of July 2015 alone.
The focus pays off
Those relationships and the market size were
sufficient for us to choose China as a preference
over any other country in the region to begin our
expansion of our market beyond Australia. In
retrospect -- knowing what we now know -- those
factors hardly constituted a solid platform to
enter the market, but we learned over time what
doing business in China required and perse-
vered to increase our standing in that market.
Preparing for the China market
Our experience from the Beijing Olympics phase
highlighted the naivety of the assumption that
we could 'box drop' our Australian product into
the Chinese market with a language change,
and expect this strategy to work.
The outcomes from this process were that the
path to success would be prolonged and that
doing business in China would require strong
local relationships and alliances. Furthermore,
we recognised that we needed more flexibility
in our product in order to be able to apply
elements in a more modular fashion, so as to
suit the local conditions in a more tailored way.
We recognised this would be a lengthy and
expensive process and spent a considerable
time considering whether this would be viable.
In the end, we were concerned that develop-
ing a long-term presence in China for a single
application would be risky. By including a new
market approach in the regions in addition to
the logistics business, we effectively halved that
risk and potentially doubled the return from this
We were fortunate to be able to persuade Dr
Geoff Raby (former Australian ambassador to
China) and some influential local businessmen
in China to recognise the quality of our strategy
and join our board as a result.
This leadership, as well as other direct
business relationships built over time, have been
invaluable in terms of the preparation to get to
where we are now.
From a technical perspective, we also realised
that the evolution of our technology would take
time and could be engineered in a way that
would not only allow us to tailor it for local con-
ditions beyond Australia, but could also allow us
to target new market segments within Australia.
We undertook the task to improve our own
system soon after the 2008 Olympics and have
completed two generations of development
since then. The new, third-generation platform
is designed to allow us to offer varying levels of
complexity to different customers, which is an
important component in delivering an appropri-
ate solution to a local region.
SMARTTRANS HAS TAKEN NO LESS THAN FIVE YEARS OF HARD WORK TO FINALLY
BEGIN TO REAP THE REWARDS OF THE JOURNEY INTO CHINA. THE RECENT DEAL
WITH YANFENG VISTEON AUTOMOTIVE IS CLEARLY AN IMPORTANT CATALYST FOR
THE COMPANY IN THE REGION, AND IT IS HOPED THAT IT IS ONLY THE BEGINNING
OF THE COMPANY'S FURTHER EXPANSION INTO CHINA AND BEYOND, INTO THE
ASIA PACIFIC REGION IN GENERAL. GRANT NIELSEN DESCRIBES THE COMPANY'S
JOURNEY INTO WHAT IS CURRENTLY THE WORLD'S LARGEST POTENTIAL MARKET.
THE LONG ROAD TO
MHD SUPPLY CHAIN SOLUTIONS --- SEPTEMBER / OCTOBER 2015
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