Biggest isn't always best when it comes to finding a partner to distribute your product

Kevin Smith may look like a day-time TV presenter. Well-coiffeured; a smart, informal suit; a crisp open-necked shirt and a beaming smile. But his relaxed, easy going appearance belies his commercial nous. There's certainly nothing fluffy about his business success. His company, CyDen, has grown from a standing start to a £4m turnover in just two and a half years since its products hit the market.

Smith and his three co-founders started CyDen in 2002 to market its patented iPulse technology for hair removal and skin treatments. After a couple of years in development, the first products were launched in 2004. Today, from its Swansea base and with a workforce of 35 people, its products are sold in 58 countries and a stock market flotation is anticipated in the not too distant future.

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Such growth is wholly attributable to CyDen's innovative approach to building international relationships, says Smith, who is general manager and sales director of the company.

As a small company with an international presence, he says that CyDen is an example of a small to-medium-sized enterprise (SME) that has used collaborative partnering as a way of quickly setting up an effective distribution network across the world. By fostering joint initiatives, he says that SMEs can grow stronger and establish themselves as leading forces in the global market, in the face of much larger competition.

CyDen's strategy has been to eschew the traditional supplier/ distributor model in favour of collaborative partnerships with businesses - and people - they like and feel comfortable with.

Rather than simply signing up with the biggest or best known distributors in their target markets, Smith's approach is to invest time and effort in researching the market structure and finding potential distributors that share the firm's commercial ethos.

"We look for a hunger, a real desire to want to make it work. Sometimes you don't get that from the big companies. One of the disadvantages in working with a larger distributor is that they have a large number of other products that they sell. And it's very easy for them to default to selling the products that they know better, rather than the innovative new product that you've started supplying. So it's not always the largest distributor or the top two or three that you end up doing business with. It is those that display their hunger and their passion for growing as aggressively as you want to grow.

"Moreover, in some countries we've found that those companies which know the end-user best are those that have, themselves, been end-users and then moved into sales and distribution. Typically, they are very small companies - and some of them are among our most successful distributors," he says.

CyDen looks for distribution partners who have skills it can apply to the local market. They need to be excellent at marketing. They need to have a good sales team, including a strong back-up service; and they need to be very effective in training: CyDen invests a lot into training and expects its partner to do the same.

"Essentially, we have a check list and the boxes need to be ticked before we will work with a distributor," says Smith.

But he says that the most important skill a partner needs to demonstrate is how it handles people and personalities.

"To put it in rather simplistic terms, we only work with people we like. If you have a relationship based on narrow self-interest and confrontation, as a lot of traditional agent/supplier relationships are, then things will always deteriorate. But if you have trust and friendship with your distributors, any problems get quickly and amicably resolved. There's also the issue that if we want our end-customers to do business with our distributors and to like them, then we have to as well. We have no interest in traditional customer/supplier relationships. It's partnerships that we're looking for," says Smith.

Signing up "partners" as opposed to "distributors" is a lengthier and more costly process, but he says that it is ultimately more sustainable and more likely to lead to long-term success. The emphasis is on developing a two-way conversation between partners, using the knowledge and insight each provides, to refine and improve their approach to market.

CyDen works with its partners to set up workshops and customer training sessions, getting to know the customers as well as the partners. They work together to design marketing materials and product literature that best suit local conditions. Smith himself spends a lot of time getting to know the local market, the customers and the competition. The aim is to understand the challenges and practicalities of each partner's operations and to adapt CyDen's approach accordingly. Similarly, Smith expects the partners to learn and understand CyDen's challenges and to work with them to overcome them. He even brings partners from different countries together twice a year to share experiences and learn from each other.

He stresses that it is not about imposing or replicating a CyDen way of doing things in different markets around the world, it is about using the market knowledge of local partners to adapt the approach accordingly. In Japan, for example, CyDen's distributor raised a question about the effectiveness of the company's standard marketing material in a country with such different customs, expectations and business traditions. The response was to make all the elements of the marketing materials available online, so the partner can take the basic artwork, style and content and re-interpret it for Japan.

"A lot of our larger competitors have been around much longer than we have but they haven't been as successful in their international approach. Their mistake has been to try and set up direct sales operations overseas and to try and apply British or American management style and culture on to a foreign way of doing business. Frankly, that very rarely works," he says.