Ciparo/Golden Windmill: 12 year Paper Trade in China
Asking Thijs Cox and Louis Hoogendoorn how to describe the activities of Ciparo/Golden Windmill in China: “Selling, importing, converting, warehousing, distribution and processing of reclaimed paper in bales and rejected paper in reels from all over the world, with 4 sales offices and 1 converting plant. We are reclaimed and joblot “lovers” from secondary to prime papers, who are trying to serve our Chinese clients in the best way.”
This is Ciparo/Golden Windmill 2004 in a nutshell. “It all started in 1992 when Dutchman Thijs Cox visited Beijing for a short holiday. Not really with the intention to become a “paper trader”. Made enthusiastically by the export manager of KNP BT Paper Recycling of the Netherlands, Cox was selling the first lots of carrier board in bales and sending a fax to the home front that he would not return from his holiday a couple of weeks later…
It was impossible to run his second office in Tianjin, together with the Beijing business. In the beginning of 1996 Louis Hoogendoorn, who came to China in 1994, joined Cox and transformed the representative office in Tianjin into a wholly foreign owned company. “Thijs already built up a stable customer base, so for me it was just a matter of keeping the customers satisfied and promoting new products. After KNP BT Paper Recycling was transformed from an export-orientated company to a service company to serve their own paper mills, we stopped acting as an agent for them. This meant more risks for our own company, but we went through the learning curve in the first years,” says Hoogendoorn.
Ciparo/Golden Windmill survived the high waves of the last 12 years. Offices in Beijing, Tianjin, Shanghai, Guangzhou and Rotterdam are selling all kinds of reclaimed paper grades and rejected stock lots.
The first suppliers are knocking on the door and asking the company to promote their prime quality stock in China.
Cox: “We import the cargo for him, sell out the goods in local currency via our wholly foreign owned company and remit the money back to his company in the USA. Of course we ask a small fee for that.
That is one of the advantages of Ciparo, as well as being on top of the market with 4 Chinese sales offices in Beijing, Tianjin, Shanghai and Guangzhou. “If a customer has some queries about the paper, we go there ourselves and inspect the goods. All four offices are managed by young foreign reps who speak, understand, read and write Chinese”, explains Cox. It is essential that there is a good understanding of western and eastern business culture in our offices. Further more, doing business in China is dominated by personal relationships. Without having a good personal relationship it is hard to do business. There is a certain truth about this after being in the field for about ten years.
At this moment Ciparo purchases from Europe via their Rotterdam-office. Logistics in paper trade are more and more important. Margins on paper products are getting lower as pricing is now more transparent. So when facing too much freight or demurrage, there is no margin to make anymore.
Cox and Hoogendoorn are optimistic about the challenges for the future. “The statistics do not lie. Consumption per capita of paper in the US is about 300kg a year while the consumption in China is around 30 kg per person per year. With an annually increasing paper consumption rate of 10.6%, China will have an annual demand of 100 million tons by 2010 becoming the world’s largest paper consumer. We are already part of that development for 12 years”
We have a so called “luxury problem”: we have the customers, but there are not enough (rejected) goods available in Europe. That’s why we are looking for strong partners in North America and in Scandinavia at the moment. We prefer to go to the paper mills and offer them the whole set: waste paper, pulp, and maybe in the future we can also take some prime back for export”
“Nowadays in China, there is also a lot to organize concerning recycling. The “big time” for baling machines will start now, because the environment plays a significant role in the future policy of the Chinese government. We are the agent of Bollegraaf Recycling in the Netherlands and plan a feasibility study with financial support of the Dutch Government.
Separating all kinds of waste materials and making them profitable should be possible over here in the long term, “according to the paper duo, who both plan to stay at least another six years in China. Hoogendoorn ends: “The Olympics are coming to Beijing in 2008, that would be a nice time to discuss about successors? Or maybe the World Expo in Shanghai in 2010 might be a nice event for that…”
Paper Asia – May 2004