For over four decades, Merle Hinrichs has been in Asia working on ideas and technologies that have kept him ahead of the competition; sometimes years ahead. He began as a publisher but this was simply a means to an end: that end being the delivery of the right information at the right time to those whose businesses depend on it.

However one may wish to organise trade, it will always depend on buyers and suppliers being able to exchange information about needs, products and services in ways that work for all those involved. Mr. Hinrichs realised this very early on when he came to Asia in the 1960s. Although he has lived in many places, particularly in Japan in those early days, he said that Hong Kong has been his main base.

"We started in print publishing, of course. At that time - in the mid 1960s - Japan was moving upstream from an industrial point of view. There was a substantial trend to specialise and they were heavily promoting brands. We did a lot of work for Sony and many other big names in Japan and we found distributors. Once you are in place and have established a brand, brand promotion and advertising become important," he said.

After gaining a lot of experience in Japan, Mr. Hinrichs and his team moved on to Korea and Taiwan. He then began spending more time in Hong Kong. Having put a great deal of effort and money into the business, he thought it was time to expand. The Japanese, he soon discovered, had other ideas.

"The Japanese were not prepared to put in the money or the effort to extend the business throughout the rest of Asia. The one thing that became very clear to me was the buying process: the issue here is that buyers do not just bring demand and money, they bring their ideas and an understanding of the markets they buy into. They also bring their ability and willingness to communicate that to suppliers. My job was to make sure that the suppliers were better at communicating their skills to the buyers," he said.

This communication was a lot more complex and sophisticated than simply telling the buyer how many boxes of an item will fit into a carton. One must remember that we are talking about vast distances, and people who could not hop over to Shenzhen and have a look at a factory. Under such circumstances, even the very basics become important. Does the company really exist? Can they really make the products they say they can?

"In Asia, we went from agriculture, handicrafts and labour-intensive domestic activities to being literally the manufacturing plant of the world. Most of the world's consumer products are now made in this region - the dominance in manufacturing is extraordinary. For example, today nearly all material products required for babies and children - such as toys and clothing - are manufactured in Asia. I think our contribution to the region - and now to China - is this ability to bring the East and the West much closer, long before an actual deal is concluded," he said

It was his wish right from the beginning to bridge the information gap that exists between buyers and suppliers. It can be difficult enough when they speak the same language, but when the supplier is in Shizuoka or Shanghai and the buyer is in Sheffield the communication problems can be enormous. Horror stories abound of products not being made to the proper specification over the years.

Hinrichs moved his main operations to Manila in the early 1990s, and Gloria Arroyo performed the opening ceremony.

"The buyers have to believe and understand that you are there to help. Even to this day, there is not a single supplier on our web site that we do not personally visit. We validate everything. We check to see that the entity is legal and registered and they really do manufacture the specific products they claim they do. We do not allow companies to post products on to our web site," he said.

Global Sources has been criticised for not putting up everything that comes their way. Mr. Hinrichs said his customers rely on him for accuracy so it would be impossible to put things up that he had not checked on. It may take a little longer to get on the site, but the customers all know that what is there has been checked.

The IT vision

Back before he established Asian Sources in 1971 (the company name before it changed to Global Sources in 1999), Mr. Hinrichs was one of the first to buy a mainframe computer. Considering the cost of such machines back in the 1960s, that was a bold move indeed. Within a year of founding Asian Sources, he was the first to buy an IBM batch-processing system in Asia.

Magazines are still an important medium for information.

Over the years, the company has always looked to technology to give them an edge. Just before the internet boom, they had already moved onto client/server technologies and were thinking about ways to deliver their content electronically. Then the world woke up, as it were, to the internet.

"The Internet was like manna from heaven for us. The issue was not about the feasibility of the medium, the issue was about the connectivity," he said.

It was very clear indeed to Mr. Hinrichs and his team that this was something that could radically change the way his content was delivered, but the question was not about the Internet - and later the Web - it was about how suppliers could connect to it. People in Mainland China would say to him: "The fax works just fine." He did not have much faith in the longevity of the facsimile machine once he saw what could be done over the net. But even with the fax sceptics he was quite surprised at the Internet uptake.

"Within 12 months, 30 percent of our clients were online. Many of them would accept the technology based on the fact that we said it would help them. Once they did and once we started communicating with them by email, everybody did. Within a year's time after that, we said, 'Look, if you cannot be e-mail enabled within 24 months, we will not be able to serve you.' I would point to the fact that in 1997, 12 percent of our business was online, today it is more than 60 percent," he said.

China success has been very important to the success of Global Sources. Hinrichs is shown here with Madam Wu Yi, member of the Political Bureau of the CPC Central Committee, vice premier and member of the Leading Party Member Group of the State Council.

"Compared that to the latest Forrester figures for the United States: 12 percent of businesses in America use the net for B2B transactions", he said.

Not everything has been so smooth, of course. A great deal of time and money was spent early on trying to develop a software product called eTrade. This was something they had developed in order to get buyers and suppliers online and communicating.

"We thought it was an ideal product for the supplier and the buyer. The buyer would be able to place purchase orders with a multitude of his suppliers. We did it on our client/server in 1992 and we sold about 325 packages. At that time, we thought we would be able to provide a complete package with customisation. Unfortunately the customisation became more and more extensive. Each package we installed required more and more programming and became its own version. We then had to decide if we wanted to turn ourselves into an ASP (Application Service Provider). We felt we had exhausted the variations of the same theme," he said.

The biggest problem at that time - by now it was nearly 2000 - was that people were beginning not to trust the net with sensitive data. Mr. Hinrichs soon realised that in order to move forward, a serious amount of investment was needed. In what would prove to be yet another astute move, he decided to sell off the software business and not try to become a major software house. It was also about this time that the company moved from being an Asian company to a global one.

Having been so good in the past at predicting the future, Mr. Hinrichs was not shy about predicting what is likely to happen over the next few years.

"The technical service industry will be so much broader and more spread out that it will be ubiquitous in its nature. It will cover design and go right through to manufacturing. Success, however, will depend on the customisation of product and service. People are going to accept technology as a given. Their next requirement is going to be: Does it work for me? Those organisations that have the sensitivity, the foresight, the commitment and the resources to customise whatever they do for their clients in a UI (User Interface) way where the average person can really work with it will win the battle. They do not have to have the best product or even the best service: they need only to identify with the client," he said.

As for Hong Kong and its role in the future, Mr. Hinrichs was almost enigmatic: "I think the sovereign nation of China and its expansion can either preclude Hong Kong or can benefit Hong Kong and it's Hong Kong's choice."