Oxyfresh of Idaho

The Company

Oxyfresh, based in Coeur D’Alene, Idaho, manufactures personal care products for humans and pets. Founded by dentists, the company got its start by creating a mouth rinse that eliminates bad breath without masking it with alcohol. The key active ingredient was the unique odor- eliminating “Oxygene,” which neutralizes volatile sulfur compounds that cause odors through a powerful oxidation process. Looking to cure Fido’s bad breath? Oxyfresh’s pet care products freshen breath while eliminating microorganisms that cause periodontal disease and can shorten a pet’s lifespan. Oxyfresh’s pet care products also include pet ear cleaner, deodorizer, shampoo, jerky, toothbrushes, gels/toothpaste, antioxidants and an all natural “Mellow Out” pet relaxant.

The Challenge

By 2008, Oxyfresh identified key trends in the Asian market, and quickly sought to take advantage of potential selling opportunities. “Pet stores were opening up everywhere,” says Steven Wood, CFO & Vice President. “The middle class was growing and families were having fewer children. Pets were becoming the new family member, and we saw the opportunity for our products to succeed there.” New to the Asian market, Oxyfresh sought guidance on how best to proceed into such a large and diverse region.

Some of their primary challenges included finding the right partner and distribution channels. “We were looking for a long-term partner and not a quick export sale,” said Wood. “The right partner for Oxyfresh needed to be as passionate about the product as the company itself, and promote and educate consumers in the respective territories.”

Wood says that with the right partner, he sees excellent opportunities to help improve the health and welfare of pets and educate the consumers on the risks of periodontal disease, also known as the ‘silent killer’ of pets.

Oxyfresh Pet Care Products

The Solution

Oxyfresh contacted the U.S. Commercial Service (CS) Boise office, and was encouraged to participate in a trade mission with Governor Otter of Idaho to Hong Kong, Macau, Vietnam, and Taiwan. During the trip, Oxyfresh met with pre-screened potential partners arranged through the CS Gold Key program. The Result? Successful new distributorships and sales in Taiwan and Hong Kong. After returning to the United States, Oxyfresh continued to work with the CS Boise office, which led the company to secure its largest overseas pet product partner to date, a distributor in Hong Kong. The CS also helped Oxyfresh set up meetings with several key players in other Asian markets, resulting in a partnership with a pet product distributor in Singapore, and promising leads in Australia and Vietnam.

Having found the right partners, Oxyfresh used CS trade counseling and market intelligence to map out its distribution and marketing strategy in Asia. Together, they determined which distribution channels would be most successful, depending on where customers typically bought its pet care products. In Taiwan, Oxyfresh first made its premium products available at veterinary offices before rolling them out to larger retailers and pet stores. The second part of their strategy involved distributing educational materials to veterinarians and customers explaining how Oxyfresh products could prevent periodontal disease.

In June 2010, Wood joined Governor Otter again on a second trade mission to China. As a result of that mission, Wood expects to be shipping pet product orders to Guangzhou, Shanghai and Beijing. “Our participation in the two trade missions to Asia have been a great success, due in no small part to the efforts of the U.S. Commercial Service,” says Wood. “They helped us identify potential partners, do the legwork that enabled us to meet with decision makers and owners of several prominent companies for us to consider, and also provided us with translation assistance —all of which have saved us valuable time and resources.”

The CS also helped Oxyfresh connect with the U.S. Export-Import Bank, which provided export funds for working capital and to cover the cost of travel for the two trade missions. Thanks to the funding provided by the U.S. Export-Import Bank and the revenue created from exporting, Oxyfresh was able to support new product development research and consider additional international markets. As a result of exporting, the company has added a full-time employee and expects to see even more job opportunities as it grows their export business.

“For the last several years, our exports accounted for only three percent of our overall sales. As of June 2010, we’ve more than doubled this amount, with exports accounting for nearly seven percent of sales year-to- date, and we expect that to continue to increase in the upcoming months,” says Wood.

Lessons Learned

Wood advises other companies, “If you are thinking about exporting internationally, do it! Utilize low cost available resources that can produce a high return. The U.S. Commercial Service can provide you with many services ranging from locating partners to helping you translate between international candidates and help you with promotional efforts by displaying your products on your behalf at key regional trade show events. All of which are pennies on the dollar from an advertising and promotion perspective. And the returns can be substantial.”

Learn about the culture where you want to do business. “To be successful in the Asian market, you have to understand that it’s a relationship-oriented culture and agreements take time,” says Wood. “For example, Asian partners stress friendship, fellowship, and then business.” Having made strong business partners in Asia, Oxyfresh is now working with multiple Chinese companies to create a distribution channel that will better market all of its products throughout China.

Action

  • Participate in trade missions. Oxyfresh’s trade missions to Asia allowed them to meet with and establish partners in China, Taiwan, Singapore, and Hong Kong.
  • Learn about the culture of your target market. Wood learned that personal relationships are important when doing business in Asia, and patience and persistence are needed as deals may take a considerable amount of time.
  • Identify trends in new markets. Oxyfresh identified opportunities in the growing Asian pet care market, and together with the CS, planned an exporting strategy for the region. The CS can help your company identify new markets and stay abreast of various industry trends.
  • Choose your international partners carefully. The CS provides background checks on potential partners, and uses extensive expertise and due diligence to identify reputable foreign buyers and partners.

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