Overcoming Cultural Challenges in Selling a Product WorldwideJune 15, 2012
Doug Barry is a Senior International Trade Specialist in the Trade Information Center, part of the U.S. Commercial Service.
Elena Stegemann, International Business Manager for NuStep Inc., a specialty fitness equipment maker, visited the White House recently to receive the Presidential E Award for accomplishments as a small business exporter. She shared her Michigan-based company’s story as well as her own personal journey with me.
Barry: The founder of your company is a serial entrepreneur.
Stegemann: Yes. Our owner and CEO, Dick Sarns, is a biomedical engineer. He actually had another company before this one. He is the creator of one of the first heart-lung machines in the world. He had a company under a different name which he took global, by the way, and was also the winner of an E Award back in 1974. So we have a good history here.
Barry: Did the heart-lung experience lead to this more recent venture?
Stegemann: After he sold that business and after he had been immersed in the experience of working with people who had cardiac problems and got to have such a problem that they needed a heart-lung machine, he decided to focus with his next company on prevention. Prevention, we now know, is exercise. But 20, 30 years ago, that was not a well-known fact.
Barry: The business is based on an exercise machine?
Stegemann: Yes. So he has developed a machine that allows people to exercise in situations where they typically wouldn’t be able to just walk into a gym and hop onto a treadmill because they have some kind of a physical condition that prevents them from doing that. Sometimes it’s just old age. Sometimes it’s obesity. Sometimes it’s medical conditions like multiple sclerosis or stroke that make exercise very challenging.
We manufacture a seated cross-trainer. And because of its unique design, when a person is able to move at least one limb – so let’s say your right hand – and the rest of your body is paralyzed, because of the design of the machine, once you move your right hand, everything else moves in a passive response. Some people have not seen their legs move either ever or in a very long time. And they are able to sit down, get on a NuStep. Their legs get strapped in with special adaptive devices that allow them to be locked in an ergonomically-correct position. Then they start using their hands and lo and behold, their legs are moving.
Barry: The patients must be amazed.
Stegemann: You have to understand it’s not just a physical transformation. It’s everything about that person changes in that one moment. So we get to bring those moments to people now around the world, not just in the U.S.
Barry: Finding buyers around the world didn’t happen overnight. What was the biggest challenge in bringing this technology to a global market?
Stegemann: I would say the biggest challenge that we face on a daily basis entering new markets is the mindset that people have in other parts of the world that exercise is not necessary. We now kind of almost intuitively accept the idea that exercise is a critical aspect of the wellbeing of every person – young, old, healthy, disabled, whoever you are. There are many people around the world who really have not embraced this idea yet. So when I walk in there and I try to tell them about this, you know, exciting opportunity for their residents, they look at me like I’m crazy, like what, you want grandma to exercise, she has worked hard her whole life, she needs to sit on the couch and drink tea and watch the telly, right?
Barry: How did the Department of Commerce help with a challenge that goes to the heart of the acceptance of your product among disbelieving potential customers?
Stegemann: Early on when I took on the role of international business manager for the company, one of the things I was tasked with is creation of a go-to-market strategy, how are we going to do this, how is this little company in Ann Arbor, Michigan, was going to reach out to the rest of the world. I made the decision that we were going to work with distributors around the world and we were going to build up a team of really sophisticated visionary-type of companies who really got the idea and understood the challenge that they were going to have in creating awareness for our product in their market. This is where the U.S. Commercial Service has been an invaluable resource to us.
Barry: What did they do for you?
Stegemann: They’ve helped us find and checked out distributors for us in Brazil, China, Mexico, Korea and other countries. I went to a medical device trade show in Germany and the U.S. Commercial Service staffed the USA Pavilion. We had our own interpreter. He made appointments for us. And as a result of those meetings, we ended up having distributorship agreements that are still in place in Germany, in Australia and in Italy – not bad, okay? This was the first year that we decided to go international. And if we hadn’t gone to MEDICA and hadn’t used the Commercial Service, I think that would have delayed us by several years.
Barry: Give us a sense of what international sales mean to your company?
Stegemann: We are now in 25 countries, which is pretty good. Our international business is now about 15 percent of our revenue. So if we didn’t have that it would hurt. And that’s 15 percent, from almost nothing. So we’ve added people. We’re hiring people. We’re keeping other people not just in our company but other people working with trucking, logistics, banking, letters of credit, packaging, all kinds of people are working because we are shipping containers of stuff. We also make a priority of hiring local people who lost their jobs, some of them from the auto industry. They know how to make things.
Barry: And you’re helping keep us employed at the U.S. Commercial Service, and we thank you.
Stegemann: And that too, exactly. I’m glad.
Barry: As you’ve traveled around to the nursing homes, hospitals, tradeshows and so forth, are you learning anything that has made NuStep a better company?
Stegemann: Absolutely. It’s been an additional benefit for us because when I go to trade shows, when I go to visit with customers or potential customers in other countries, they’re asking me questions, like, well, can you product do this, can you do that? Sometimes the answer is: I don’t know; we’ve never thought of that because in the U.S. no one has ever asked us this question. I feel like being a global company is giving us a competitive advantage over other companies because we may see a trend that will eventually come to the U.S. So we have the opportunity to see the future.
Barry: Can you give us an example of one maybe innovation or change that you made on your device as a result of something you observed somewhere?
Stegemann: We are always innovating our product line, and use ideas that we get from the tradeshows we attend globally, but unfortunately I am not at liberty to disclose any details just yet.
Barry: You recently went to the White House to receive the Presidential award. You told me you were born in the Soviet Union. What was going through your mind? You said you were considered at one time as the enemy.
Stegemann: If somebody had told me back then that I was going to be a U.S. citizen one day, that I was going to travel and represent the United States one day with an American passport and that I would end up invited to the White House one day, I would have just laughed. I mean, it was just so incredibly unbelievable. To people all over the world I’ve met, I’m the lady from America. I’m sorry. I get very emotional.
Barry: As a woman out in the world, is that an advantage or disadvantage or is it nothing?
Stegemann: It’s all of those. I see it as an advantage. So I just treat it as such. Whether it is or it isn’t is up to the other person to decide. Being a businesswoman and dipping your toe in the waters is a transformational opportunity–for myself but also for other people that I interact with.