Cintas builds solid foundation for future growth in China
Print Edition
Tim Beagle is the managing director of Cintas China. He manages the day-to-day operations and business development in the Asia Pacific Region.
Beagle graduated from California State University with a degree in business law and finance and received an MBA degree in operation research from San Francisco State University. He joined Cintas in 2005.
Shanghai Daily recently sat down with Beagle to talk about Cintas’ operations in China and its future plans.
Q: Having served in North America as a successful uniform services company for more than 80 years, what was the incentive for Cintas to enter the Chinese market? How was the process of evaluation before the market entry? And what were the first expectations?
A: With annual GDP growth rates of 9-10 percent for 30 years, China has quickly become the second-largest economy in the world. In addition, China is currently the manufacturing capital of the world with a great “uniform culture.” Workers wear a uniform everyday to work in most of the industries within China. Once we landed, we noticed it is a very common practice to have a uniform. It doesn’t matter if you are a person cleaning a floor, or an operator on a production line, they wear some kind of uniform. The market potential is huge.
Our expectations were always focused on the long term. We knew we would be the early player in the total solution uniform program in China. But by doing all the early “heavy lifting,” we would have a solid foundation to build upon when outsourcing solutions become the norm and workers require a clean uniform everyday they come to work.
Q: How has the Chinese market differed from its North American counterpart? How has Cintas adapted and evolved its services in China?
A: In the US, we provide a total uniform solution to many industries, such as manufacturing, hotels, restaurants, and medical. But in China, for the current stage, we focus on industrial, food processing, protective apparel, and controlled environments. We provide them a total uniform service to help them improve their employee wellness, image, quality and management convenience.
In the US, 50 or 60 years ago, or 80 years ago when Cintas first started, there were mainly factories, but now the US is more about hospitality, restaurants, and service based companies, so our services in the US are tailored to smaller-sized companies or operations. When we first came to China, we mainly focused on large factories, we will move to hospitality and CBD type businesses in the future.
Q: Are users of the uniform leasing service normally confined to multinational companies operating in China? How does Cintas care for potential local customers?
A: When Cintas just entered into the China market, we started from multinational companies. But now, around 50 percent of our customers are local companies. The uniform service program’s value is being well recognized by all companies.
Q: Please comment on the performance of the company since it entered China. Do you have future expansion plans?
A: We do not only evaluate our performance by sales volume and profit margin, but also how quickly we educate, advocate or promote the total uniform service value to the market. We’ve successfully set up a solid and strong foundation and a great team of working partners that share the same believe in Cintas’ value to the business wearers and environments. Now we are going to the second phase in our development, which is replicating our success in new territories.
Q: The Chinese government is issuing stricter standards on environmental protection, how would Cintas respond to that in its daily operations?
A: We like that the China government is setting up stricter standards on environmental protection. We are the pioneer and leader in environmental protection in North America and we bring the same value to the China market. Our significant investment on the wastewater treatment and water recycling system in our China facilities proves our social responsibility as a global citizen. We will continue to invest and be recognized as the world leader within our industry.
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