Co-creating markets: Leasing in Asia

Industry: Construction
Customer story

Soilmec, a leading provider of equipment for the ground engineering industry, embraces new challenges and undiscovered markets. Together with their leasing partner DLL, they are charting new territory by bring the leasing concept to the Chinese construction industry.

New opportunities in China
In China's vast but still young economy, aspiring entrepreneurs are common. These ambitious professionals are highly motivated and skilled, but lack the money or resources to start. They are called ‘civil bosses’. Giuliano Ghirardelli, the Shanghai-based MD of Italian foundation drilling equipment manufacturer Soilmec, knows that civil bosses are an important target market for his company. Soilmec enjoys a longstanding partnership with DLL, so you'd imagine that arranging financing would be easy: The civil boss leases his Soilmec equipment from DLL and away you go. Not quite.Soilmec

Convincing the skeptics
"The whole concept of operational leases is very new here," explains Ghirardelli. "Soilmec and DLL have more or less pioneered the leasing concept in the Chinese construction industry. In the beginning, customers were skeptical about leasing solutions. They were scared of being cheated or paying too much interest." To overcome this, DLL and Soilmec have spent the last few years going out to meet potential customers. "We always speak ‘one language’, together helping the customer identify the best solution for them technologically and financially. And we always convey the same feeling: trust in us," says Ghirardelli.

We always speak ‘one language’, together helping the customer identify the best solution for them technologically and financially. And we always convey the same feeling: trust in us. "
Customer story

In trust we trust
This exercise has helped overcome the initial skepticism. In part this is because their Chinese clients have been quick to understand the advantages of leasing solutions. But Guiliano believes it is also because they have seen that the relationship between Soilmec and DLL is built on trust, and that this has helped them trust both the vendor partners and the concept.

Pushing the boundaries
The two companies have built on their achievements in China to enter Australia, Malaysia, and other Pacific and South-East Asian markets. Giuliano says DLL’s skill in gauging local market need for, and openness to different financial instruments has helped enormously. For their part, Soilmec tries to go beyond simply selling machinery to become a ‘solution provider’ that supports customers with pragmatic technological answers and helps them set up the job site.


Soilmec and DLL have more or less pioneered leasing solutions in the Chinese construction industry.
Customer story

Collaboration before costs
While Soilmec and DLL share costs, risks, and market intelligence, the flourishing collaboration goes much deeper. Ghirardelli gives an example. “We had a customer who stopped paying. DLL decided to take back the machine and asked us to help rescue it. We provided an engineer and an operator, and two days later it was in our workshop. Together with DLL we remarketed it and sold it to another customer within three weeks. Later we shared the margins with DLL, but at no point during those three weeks was there any discussion of costs, reimbursement or whatever. That’s what I call an example of real cooperation and trust.”

Mutual respect and responsibility
Ghirardelli stresses that you don’t reach that level of trust without being open with one another. “Our relationship with DLL is based on mutual respect and responsibility. That means we’re not afraid to tell one another how we see things. To be frank with your partner sometimes means helping – not forcing – them to take that final decision.”

Respect, sincerity, ethics are concepts at the base of real cooperation, and real cooperation leads to mutual benefit. "
Customer story

Confucian trading
Returning to China, Ghirardelli thinks there may be another reason why his Chinese clients have been so impressed by the partnership between Soilmec and DLL. "Our Chinese friends have a concept they call ‘Confucian trading’. This is the belief, which I share, that it isn’t necessary for one party to prevail over or cheat the other. Respect, sincerity, ethics are concepts at the base of real cooperation, and real cooperation leads to mutual benefit. I see this Confucian trading mentality in DLL’s approach, in good and bad times."