Knowledge of the local market doesn’t automatically equate to an understanding of how international markets operate. While a product, which is successfully marketed in Malta might find a place in international markets, its competitiveness in those markets isn’t guaranteed.
For a company to expand its operations internationally, it must undertake comprehensive market research, have a significant readiness level, and offer products and services that meet the demands of foreign markets. Moreover, a company must factor in additional costs related to marketing, adhere to specific market standards and regulations, and navigate diverse cultures. It is worth noting however, that there are instances where a company is compelled to internationalise due to a lack of other available options.
This scenario applies to Sentech Malta FP Ltd, a company that produces fibre-optic gyroscopes, specialised sensors designed to measure the rate of rotation. These gyroscopes are used in a variety of applications, from high-end aircraft flight control feedback to less sophisticated applications such as professional camera stabilisation at the lower end of the spectrum.
“We market and sell our products in international markets as there is no market for our products in Malta,” says Sentech Malta FP Ltd’s Malta managing director Arthur Tua. “In our case, internationalisation was the only way forward.”
Tua explains further: “Prior to launching our manufacturing capacity more than 15 years ago, Sentech Malta FP Ltd was engaged in trading fibre-optic gyroscopes, commonly known as FOGs, which we purchased and resold on the international market,” says Tua. “We also conducted failure analysis and repair of FOGs. These endeavours proved beneficial because once we started manufacturing our own FOGs, we already had an established clientele. So, for us, internationalisation was a logical and a natural step.”
Substantial preparations were necessary before Sentech Malta FP Ltd could embark on its internationalisation journey.
Assembly and testing.“From a logistics perspective, establishing strong partnerships with courier services operating in Malta and the countries where we sell our small yet high-value products, was crucial. We also invested heavily in a website that offers technical information and product manuals – this tool helps us to effectively communicate the features and capabilities of our products to our existing and prospective clients. Furthermore, we have an in-house marketing executive responsible for continuous monitoring and updating of our website to ensure its optimal performance.
“Another critical aspect when embarking on an internationalisation journey is gaining a deep and critical understanding of the markets and identifying niches where your products can excel.
“In our case, we recently made the strategic decision to focus our development efforts on reducing the size and weight of our products. This investment has paid off and we now manufacture the smallest fibre-optic gyroscopes (FOGs) worldwide. We have also decided to focus on mid-range performance – rather than producing very high-end products.
“It’s important to point out that this does not compromise the quality and reliability of our products, which remain essential to our core values. For example – the flight control systems of the Airbus A350 does not need a high-performance FOG, but in this case reliability is key. This demonstrates the significance of reliability over high-end performance in certain applications. In fact, the Airbus A350 flies with six of our FOGs.”
Sentech Malta FP Ltd exports to multiple countries, with Europe serving as its main export market.
“We export our products to Italy, France, UK, Spain, Czech Republic, Poland, Germany Sweden, Netherlands, Belgium, Israel, the US, Brazil, New Zealand, China, Taiwan and India among others.”
Naturally for a company to operate in such diverse markets, various challenges exist
“Yet such challenges are not specific to Maltese companies,” says Tua. “The challenges are essentially the same for companies everywhere in the world.
“As a relatively small company in an industry that includes very large multi-national corporations, one of our top priorities is establishing our brand presence and gaining recognition. To achieve this, we actively participate in various international trade fairs and exhibitions related to the industries that use our products. Given that we are a company involved in high end technology, we also sponsor one of the most important conferences in our field, the IEEE Inertial Conference. This provides us with high visibility among the right people and in the industries that matter most to us. We regularly attend relevant conferences to stay connected with potential customers and suppliers.
“In our industry, besides marketing efforts, product quality and technical support are also extremely important. One needs to build a reputation based on performance and quality. These factors are crucial in building and maintaining a strong reputation.”
For a company that wants to internationalise, TradeMalta’s support is of paramount importance.
“TradeMalta is an invaluable source of support and information throughout every phase of our internationalisation journey,” says Tua. “TradeMalta provided Sentech Malta FP Ltd with direct financial assistance through their Global Growth programme which enabled us to participate in international trade shows, that are fundamental to our marketing strategy. Additionally, we maintain ongoing contact with their executives who provide us with potential contacts and leads, further aiding our international expansion.”
What is next for Sentech Malta FP Ltd?
“In terms of product development and marketing, our primary focus revolves around our compact gyroscopes. Additionally, we have developed and are introducing a range of Inertial Measurement Units (IMU) which incorporate three of our FOGs. Once again, we are focusing on compact size and minimal weight to ensure we meet the demands of our target markets effectively”.
“During the Covid-19 pandemic, demand for our products declined considerably. However, at present demand is extremely high,” says Tua. “To address this, we have increased production to meet this high demand. Nevertheless, this is quite challenging, due to human resources constraints that exist in Malta”.