Your family considers SpaghettiOs to be one of the major food groups. You’ve been dying to squeeze the Charmin once again. And it’s that afternoon complement of Reese’s Peanut Butter Cups that gets you through each day. But because you’re living overseas, you can’t find any of these products. When you do, they’re expensive. What do you do?
For Japan resident Chuck Grafft, the answer is pretty simple. Gather up your expatriate friends, form a club, and start your own order fulfillment company. Then add some local friends and watch it take off.
Brand pull
Grafft’s quirky little company, called The Foreign Buyers’ Club (known in Japan as “FBC”), demonstrates the considerable pull of U.S. brands — as long as you can get them delivered at reasonable cost.
On second thought, FBC may be quirky, yes — but little? Maybe not. FBC claims to have over 120,000 customers and annual sales of almost $7 million. FBC’s promise to deliver door-direct “Food and Fun From Home” has been a real godsend for people like Mitzy Cullen, who used the service for years in Japan to get the items her family missed the most. “My husband is crazy about a particular brand of mustard, and we were able to get exactly what he wanted!” It’s the breadth and depth of choices — over 300 types of cereal, for instance — that has fueled the club’s popularity.
Paper towels and dog food
FBC was born out of Grafft’s nostalgic frustration while he was a Kobe-based Time/Life manager back in 1988. Working for the club members, then mostly Western missionaries in Japan, Grafft and his wife, Kelly, did all of the importing, repackaging, and distribution out of their house. They expanded in the early 1990s to serve expats and international schools across the country. Thanks to an article that appeared in a national newspaper in 1997, locals began to be attracted to the fulfillment service. FBC now employs over 50 people.
This is how it works. FBC prints a catalog with approximately 7,000 items and runs a Web site that offers over 40,000 SKUs, complete with pictures, descriptions, and case-lot pricing. Purchases are made from vendors in Los Angeles as customer orders are received. A small, resident L.A. staff consolidates a week’s bulk orders (and does “personal shopping” for some items, including special-formula dog food), loads them in a container, and ships the container to Kobe. FBC clears the product through customs and assembles orders for home delivery.
The current clientele comprises 50% American expatriates, 15% “other” expatriates, and 35% Japanese nationals. The potential of the model, underscored by the growth of local interest, has the company taking its first step out of Japan since its inception. Robin Cheung, a director with FBC Hong Kong, sees the program as a service to all sectors of the population who desire U.S. branded items but can’t get them. “I think we’ve found a way to bring the virtual aisle to Asia. We’ll first concentrate on getting U.S.-label provisions to the expats who miss them, but you can see how expanding this service to other lines can meet an untapped demand.”
Strangely, one of the more popular products ordered via the Japan site (www.fbcusa.com) is Bounty paper towels. The different patterns, colors, and sizes that challenge our decision-making abilities at the average U.S. supermarket aren’t available in Japan. One customer established her own “I Love FBC” fan site on the Web, featuring a scan of each new paper towel pattern that she gets. Sometimes you just don’t know what will sell until you give it a try.
Roger Sklar is vice president of international business development at V-Logic Limited. The Hong Kong-based logistics company provides Asia/Pacific B2B and B2C fulfillment services for U.S. and European retailers and direct marketers. Sklar can be reached by phone at (770) 753-6388, by fax at (770) 753-6389, or by e-mail at [email protected].