Sun, Jul 12, 2009
The Business Times
EtonHouse focuses on expanding overseas

EVERY city has a different culture, and being in the education industry, Ng Gim Choo, group managing director of EtonHouse International Holdings, certainly understands the impact that cultural nuances can have on business.

'There are always challenges while setting up a new school,' she says. 'The challenges are compounded when the school is in a different country. The cultural context, parental expectations, infrastructural constraints, staff recruitment, government legislation create a steep learning curve for any overseas expansion.'

To overcome some of these challenges, Mrs Ng has been working with local partners who were not only able to bring good locations and connections to the table, but also their knowledge of the local culture.

Through her Chinese partners, she has learnt protocol at official functions, such as how it was considered very impolite to allow someone to drink by himself or herself.

Such knowledge also comes in handy in helping her staff to bridge the culture gap. After all, the school employs a large team of international staff who may have problems adjusting to new cultures.

Mrs Ng says: 'It is also a challenge to attract the right international staff for our schools since China and India offers a totally different life from what they are used to.'

Aside from selecting people who are open to a multicultural experience, the company also implements 'a well thought-out induction policy that involves mentoring and inculcating language skills' to help staff adjust.

Being attuned to the local culture also helped in fine-tuning the curriculum, which has to take into account the local culture and parental expectations, which in turn, can vary greatly between societies.

Cultural issues aside, overseas expansion does have some of its draws. For one, overseas expansion helps EtonHouse tap large growing economies such as China and India.

Back in 2003, EtonHouse started with just one school in Suzhou, China. It now has eight, offering nursery to high school education.

Business in India - fed by 'a tremendous demand for quality early childhood education' - has been strong, with its first pre-school in Pune garnering very positive response.

However, securing funds for overseas expansion has been made tougher by the credit crunch. Mrs Ng says: 'Given the current economic scenario, most investors are very apprehensive and cautious. It is not the best time for us to seek funding from them now.'

Thankfully, the strong support from foreign authorities for EtonHouse has made expansion on limited capital possible.

Recognising the value of the service provided by the company, foreign authorities have been offering options for school premises and renovation grants. In Suzhou, the Gao Xin government built a brand new school - an area of 120,000 square feet - replete with indoor swimming pools and other facilities.

Assistance from the Singapore government - such as the International Financial Assistance Scheme and networking events organised by IE Singapore - also helped.

Back in Singapore, which accounts for about 70 per cent of the top line, Mrs Ng plans to establish an international secondary school. The idea was born from the need to provide continuity and natural progression for its students in the primary level.

As with other schools, setting up the new secondary school posed several challenges such as finding the appropriate premises, and ascertaining the economic viability of the school. The company is still awaiting the right opportunity and hence, no dates have been given on the opening of the new school.

EtonHouse's example has shown that internal financing can go a long way.

It helps, too, to have a prudent and consistent expansion policy. For EtonHouse, it has always looked out for underserved markets that are ready for the school's curriculum and will prove feasible investments, economically speaking. As for the future, Mrs Ng says: 'We expect revenue from overseas schools to exceed that of Singapore within two or three years. Do not be surprised if you see EtonHouse schools in Japan or Korea in the near future.'

This article was first published in The Business Times.


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