EPISODE 29: SHERIF KANDIL, CEO AT K-LINE EUROPE

Episode’s transcript

Julio Martinez: 0:04

Welcome to the Latin MedTech Leaders Podcast. This is a conversation with MedTech leaders who have succeeded in Latin America today. Our guest is Sharif Kdi . Hey Sharif , how are you doing today? It's great to have you here on the show today.

Sherif Kandil: 0:22

Hey, Julio. Yeah, thanks a lot for having me and uh, it's a pleasure.

Julio Martinez: 0:27

Welcome to the show, Kendi . Well, listeners , um, Sharif believes that he can bridge the gap between Art Atlantics Material Sciences and software engineering. And he's on a mission to change orthodontics for the better. He's currently the co-founder, CEO and head of r and d at Kline Europe, a German company with a mission to change people's thinking about dentistry. Sharif is also the co-founder of Smile App , a German company dedicated to mass market clear dental aligners. For over 10 years, Sharif has worked with clear aligners as a practitioner, technician, entrepreneur, and has also been a patient. Sharif has treated over 4,500 cases with aligners. He owns six patents and has delivered over 170 lectures worldwide. Sheriff , graduated from dental school in 2006, worked as a general dentist and then obtained a Master's of Dental sciences in orthodontics in 2012. So listeners, we are, he for a treat with the sheriff . He has a wealth of experience in, in his market in Europe and also in Latin America. So I'm really, really looking forward to this conversation. And Sharif has been the first, or is now the first guest that we have in the podcast that can talk about the dental space in Latin America. So Sharif , uh, again, welcome to the show and I'm really, really looking forward to our chat today. So before we begin, Sharif , could you please tell , uh, listeners about your journey to Latin America? How do you get involved with the region?

Sherif Kandil: 2:10

Sure, absolutely. I mean, it all started almost like six years ago where the company was still like in its first very early stages. And we were quite, I'd say like lucky to get approached by , um, a vendor in, in Columbia . And I mean, back then it was , um, quite new for us to get into the Latin American market. We had no single clue about the market. We didn't do any survey nor studies, nothing at all. And , um, I was quite surprised to find that aesthetics has a huge value in Latin America. And when it comes to aesthetics, it's usually the price just to know, like in general in in medical field or dental field, it just doubles like two or three times the normal, let's say like , um, emergency treatments. Surprisingly, this was something that caught my mind at the start. And yeah, and throughout the journey , uh, which I'm gonna tell you after a while it was , um, very interesting to see how aesthetics value is so high, but at the same time, the clients are so price oriented and first to combine both together was quite a challenge for us, but a very interesting one as well. <laugh>. Yeah. So , um, we started , um, almost like in 2014 where , uh, we started here in Germany first. And at that time the main focus, even from the name of the company, Kail on Europe, was just on the European market. And since we started, we've been focusing on , um, redefining dentistry and orthodontics through innovation. Uh, so that's why even my part was as , um, as a clinician, as even a technician and even a patient myself , um, I got my hands like dirty as they say. And I've , I've seen everything, the good side, the bad side of it, and I've been pushing the borders to , um, evolve dentistry and orthodontics as much as possible. Um, 'cause I found that this market needed a lot of , um, improvement. There was a huge potential for this improvement. And when we started to contact , uh, our first vendors from Columbia , um, they had a very good idea and orientation about clear aligners, which by the way is something quite sometimes in , in some areas still worldwide, quite trivial or unknown information. I mean, they still don't know what is exactly clear aligners. Uh, these are invisible braces made out plastic, and they're like an alternative to braces. And uh, back then there, there was good orientation about the product itself, but the methods that were still used in Latin America were mostly manual methods. So maybe I'll just give a quick, like heads up on exactly how clear aligners are done. So for those who have no idea about clear aligners, these are like plastic clear trays that the patient wears every two weeks. Uh, and they like receive like a series of aligners and every one of them is wor for two weeks and then they move on to the next one, et cetera, et cetera. Um, every single aligner pushes the teeth further towards the goal of the treatment where the teeth will be straight. And to manufacture clear aligners, we need to make like an impression or a scan of your teeth, like an image , uh, physical image of your teeth, or first it's a digital image and then it's translated into a physical image of your teeth , um, in order to , uh, make the plan for the treatment and consequently make the treatment plan or the, the aligners. So , uh, back then still was Latin America quite , um, lagging when it comes to dealing with 3D technology , uh, which is now dominant in I'd say in Europe, and it's almost also dominant now in , in Latin America. Um , and uh , they approached us because we were manufacturing using 3D technology, but back then they had no idea about this. And for them it was something that they thought could cost so much , um, money , uh, or has a different hefty price tag. And there's, this is where it started. When they found that okay, we could offer them something , um, that they could supply to their clients or their patients at a very good price and a super quality bam. I mean, demand was there. Nowadays things changed a lot in the , the Latin American market. And we've seen , um, how digital dentistry and digital orthodontics is catching up really, really fast. Yeah,

Julio Martinez: 6:32

Great. Uh, share . Fantastic answer. I mean, fantastic journey <laugh> , by the way. And I kind of identify myself with what you're saying because I am , uh, a patient <laugh> . I've , I've gone through treatment here in Columbia , by the way , uh, because it's way, way cheaper than in the US and since I come to Columbia like 10 times a year,

Sherif Kandil: 6:53

It could be our aligners, you dunno ,

Julio Martinez: 6:55

<laugh> ? Well actually , uh, I'm not using aligner. I'm, I was using the traditional method . I mean,

Sherif Kandil: 6:59

Ah , braces. Okay, yeah ,

Julio Martinez: 7:00

Braces, yeah , exactly. My specialist, my, my dentist , uh, she specialized in one of the top universities in Columbia and she suggested that I don't wear aligners because of my specific condition or case. I don't think this fits everybody, but still there's a huge market for this. Anyway. So moving along, I heard that you touch a little bit on this, but , uh, my next question usually is about trends. What major epidemiological political or economic trends do you see in Latin America that are relevant to our discussion or to your business in the region?

Sherif Kandil: 7:37

Well, I would certainly not relate it to any political , um, relation or, or connection at all. Um, however I could relate it in general to like the conscious, let's say society that is more of like a trend that is going in , um, everywhere, but especially in areas where beautiful teeth and beautiful girls, especially girls, I have to say because , um, this was at the start of the clear aligner move I call it. Uh , it was basically like we had almost 82% of our patients, only , uh, females. And wherever there is a lot of conscious about beauty, definitely clear aligners come along. It's just a normal , uh, adjunct because I mean, beauty means, okay, you need also to have beautiful teeth, to have beautiful teeth. Nowadays there is only like two really hot trends in dental industry. One of them is to put veneers directly, which are basically like small ceramic or porcelain veneers that are very, very thin. And these are layers you put on your teeth. You have like super amazing smile in like a couple of days, or , uh, you could go for orthodontics and really move your teeth into the correct position. So the trend for seeking beauty or , um, cosmetics in general is, is a huge market in Latin America. And yeah, I mean the Latin Americans, they, they tend to focus a lot on, on beauty especially , especially women. And uh, that's where the drive for demand for clear aligners and other , uh, cosmetic product and dentistry , um, came from.

Julio Martinez: 9:15

Excellent. This is gonna be a comment that , um, could be a little controversial, but um, have you ever wondered why Columbia was your first market and why women in Columbia are so, so much into beauty? By the way, Columbia is one of the top markets in the world for a 30 , uh, surgery, breast implantation, body sculpting and all that.

Sherif Kandil: 9:40

Totally. I see like almost three countries in Latin America that the demand for aesthetics and cosmetics is really high. And that's one of 'em is Columbia . The second is Brazil and Chile and Columbia has a different direction where it's focusing a lot on , uh, tourism and like dental tourism especially. And that's what, in my opinion, makes it quite different where it's like almost like a hub in Latin America for let's say like Americans or rich people to go like get surgeries or cosmetic surgeons and so on. It's not so common yet, like for example, if you compare it to Mexico, but I mean it is still one of the active areas , um, in Latin America when it comes to dental tourism.

Julio Martinez: 10:24

Yes, I agree. I agree. Alright , share , what is actually your overall perception of Latin America as a place to commercialize medical technologies in general? I mean, do you think it's an attractive market, it's a market of opportunities? I know you kind of touched on that a little bit, but in case you wanna get a little deeper into the answer, this is your opportunity <laugh> .

Sherif Kandil: 10:45

Yeah. I mean specifically concerning Columbia or in general , um,

Julio Martinez: 10:50

Latin America in general. I mean, do you think companies should look at Latin America to do business?

Sherif Kandil: 10:54

Absolutely. It's huge. I mean it , the potential is really huge and a lot of it is still uncovered. That means , um, if we just look at only the orthodontic market and the orthodontic market in Latin America is rising really high, but the penetration of clear aligners in the orthodontic market is , uh, still at a rate of almost like 6% of the whole orthodontic market. And still the potential is huge. And we've been seeing on the other side , uh, which is more like into the dental part rather than orthodontics. What I talked about a while ago is the dental veneers, you know , these , these porcelain pieces that you put on teeth in order to get like super amazing teeth in , in a couple of days, or sometimes it's the same day. And we've been seeing this business trend rising so high and it has been like striking me at the start why, especially in Latin America. And one of the reasons I found that it's , um, maybe something that, it's just my own belief. I don't know , uh, if there are other driving factors, but the, the social media awareness is also super high in Latin America, especially when it comes to like Instagram. I've been seeing like doctors in Brazil and Argentina and Chile , they have like accounts with millions of people on it. <laugh> I mean are following it. I mean, I was like, astound, how on earth did they do that? And they're doctors. I mean, doctors usually are like , they have like bad luck with social media. They're the poor chaps who caught the wave pretty late. But if you see a couple of doctors in Latin America, you see them fall by thousands and symptoms by millions and they post regularly things related to just veneers and clear aligners. And that is basically the main focus. I mean, these are two driving factors I believe that are driving, let's say products in the Latin American market that , uh, are getting a lot of traction, coupling that with high awareness in social media, this , uh, made things like, or or accelerated the momentum , uh, by multiples.

Julio Martinez: 13:02

Great. Sure . All right . So let's dive into your practical experience , uh, commercializing your, your product in Latin America. I'd like to hear your thoughts on suggested best practices in on a few topics before we get started with the details or regulatory and distribution , um, um, matters. Let's talk about the countries where you've worked in America and what specific countries , uh, are you selling right now, your product?

Sherif Kandil: 13:29

So we're quite active in Mexico, Chile and Columbia as well as Brazil. Brazil is still getting into the market , still struggling a little bit due to some regulations, but yeah, I mean these are , um, the, the countries we're quite active in mostly Mexico.

Julio Martinez: 13:48

Okay, good. So we know that obtaining regulatory approvals and market clearance is a big hurdle for many companies. So I like to hear your experiences in markets where you are active right now. So let's dig a little deeper country by country to discuss your experience and if you can give us any tips or any traps to avoid when need obtaining regulatory approvals would be would be fantastic. So let's start with Mexico and cover priest . I mean, how's been your experience so far there?

Sherif Kandil: 14:18

Well, I'll go back like one step to um, highlight which product we're selling. In what terms? Um, it is rated specially regulated, so we're not selling a serial product. The clear aligners are a custom made product under a medical class two A, so it falls under a different category that makes it much easier to sell over borders. But still there are some regulations that must be attended. So for example, we were , it's not a must for our products to sell through having a CE or FDA otherwise for our products we send a certificate of conformity and the ISO certification and uh , the sea of the material that we use. Uh, however, for the product itself, because it's custom made , maybe that would make us like quite lucky in in that terms that the import and export is a bit easier. That's in general, I mean maybe Brazil has a different story a little bit. Brazil is, is quite strict when it comes to products being imported and that somehow changed our strategy in approaching the Brazilian market by rather manufacturing there in Brazil rather than exporting to Brazil. Otherwise the other countries, I said again, it's just the class two medical products, especially class two a medical products with um , certificate of conformity , uh, c of the product itself or sorry, of the material that is used to manufacture the product with a fist .

Julio Martinez: 15:49

Okay, very good. And what about Columbia ?

Sherif Kandil: 15:52

It applies the same as in for us, from our experience, it was almost exactly the same as with Mexico. I mean, we didn't feel that there was any change when we dealt with , uh, Mexico after Columbia . It was almost exactly the same.

Julio Martinez: 16:04

Okay, very good. But you also mentioned in Brazil you still going through regulatory approvals, right?

Sherif Kandil: 16:09

Yeah, somehow like that or , um, as I said, it's more of like we're changing the whole approach where we manufacture Brazil itself rather than export to Brazil. So to like totally remove all the physical logistics in the whole , um, business model.

Julio Martinez: 16:25

Yeah, that's usually what many, many companies do in Brazil because they have , uh, very protective mentality and also helps develop , uh, local industries and manufacturing plants and , and , and create jobs. So that's why they make it difficult to import products into Brazil. And they incentivize , uh, companies to open an office and set up manufacturing , uh, facilities. Alright . Any other countries that you wanna comment on?

Sherif Kandil: 16:53

Well, I mean Argentina was one of those that we had on the list. However, Argentina was quite turbulent when it comes to the economy. And um, also our approaches with , uh, vendors over there are distributors. Um , but I think for us Brazil for now is one of the most important basically because of the population size and also the, the big market or the booming market for the clear aligners there.

Julio Martinez: 17:17

Okay, good. Alright . Any tips or comments about the importation process in these countries?

Sherif Kandil: 17:25

Well, if it's exactly like our products, then I won't , I won't think that it would be a problem for any well-established laboratory to ship cases or ship aligners to , uh, Latin America, again, accepted Brazil. However, I do believe that for others manufacturing like serial products, they have different authorization systems. I don't know if they need like the Euro one or whatsoever. Um , not involved much in serial production 'cause that's not what we do. But yeah, that will be my , um, say or call on the custom made products.

Julio Martinez: 17:58

So you've never had products stuck in costumes and you have to deal with paperwork and stuff to get them out of it, or have lost , uh, <laugh> products in costumes?

Sherif Kandil: 18:09

Well, I mean, we were fortunate enough that we did not lose anything till now. However, since our business model is based upon that, we have a distributor in every country. We do not work by ourselves, like centered based . So we always like enforce the peripheries of the company, which are our distributors are agents and they're the ones who take care of everything. I mean , they sometimes, or I'd say like almost, were not involved in the process of , um, like , uh, clearance , uh, in the customs in Latin America. 'cause that's what they do, whether in Columbia or Chile or Mexico , um, the distributors by themselves.

Julio Martinez: 18:45

Very good. All right . So Sheriff, what are some of the best practices or tips to find a distributor in Latin America and how to conduct due diligence? What's been your experience in these two areas?

Sherif Kandil: 18:59

Well, our experience with Latin America is based upon first searching for doctors. So for example, I'll, I'll maybe like scale it up from the point where we start to contact or get into any country at all. So it's like we have our global sales team, they have like a strategy and they know, okay, so this is the country , um, the next country that we have on the list. So we study this market and we start to approach like doctors and incentivize them in order to start to work with us. Finding doctors or really good doctors in Latin America is super easy to set . Again , social media has such a powerful effect and it's like all good or really good doctors are available already online with very good presence. And by the way, just, just something that I didn't mention till now, it's that the doctors in Latin America, they are just so good. I mean, they're very well educated and they're so skilled in , uh, especially , uh, things related to like cosmetic dentistry. And that could be also one of the reasons why, by the way, aesthetic dentists or cosmetic dentistry on the rise in Latin America. Uh , but yeah, that's not my topic anyways . So we, we usually start to contact our doctors directly and , uh, through the doctors. We get like referrals to potential distributors later on. And that's how it comes , um, in, or that was the case for example, like in Brazil and Chile, however, like in Mexican Columbia it was quite different. Where in the IDs , which is an international dental show that is held like every two years in Cologne in Germany, surprisingly, a lot of potential Latin American distributors come to this convention every two years. And that's how we get more context with Central America and Latin America. And I mean that there are a lot, I mean, it's, it's a really good chance to connect with the Latin American market through such shows

Julio Martinez: 20:56

Excellent approach. Sure . Very nice. And I'm also happy to hear about the fact that you think that Latin American dentist or of top quality, I mean that's fantastic <laugh>. Well,

Sherif Kandil: 21:08

Yeah, I mean even the big names , uh, in the market, in the dental field, I mean you, especially again, cosmetic dentistry, I'm just focusing or highlighting a lot of on on cosmetic dentistry. Uh , Brazilian doctors , uh, Chile doctors , um, Chilean doctors , sorry , uh, Perian , um, Mexicans, they are really famous. There are a lot of big names out there that have been doing an amazing job.

Julio Martinez: 21:30

Excellent. All right , Sharif , moving along, I'd like to ask you about the way you work with distributors. Do you have a very hands-off approach or do you work with them doing co-marketing activities? Do you have a local sales agent in some of these countries? I mean, how's your structure to manage distributors or to work with distributors?

Sherif Kandil: 21:54

Yeah, that's quite a very important point because , um, I mean from the first approach from the sales customer service and technical support, it's quite tough in Latin America to deal in English. And that's why we always have our team , uh, in-house that either speak Spanish and Portuguese. I mean , in order to cope with that, luckily distributors, mostly they have to speak English, otherwise they cannot expand their business. So that's the easy part. However, when it comes to the doctors themselves, which like come in the subcategory, we deal with these doctors under the distributor through , uh, online portal and the online portal, it's basically text. So we have like text or write in comment on let's say treatment plans in, in Spanish. And that's why having this in-house is, is very important. Um, otherwise it doesn't work at all in Latin America without having the right resources with you.

Julio Martinez: 22:51

That's extremely important. Yeah , and even though the shooters also speak or they have to speak English, I mean their English skills are not , uh, the best necessarily. I mean, it's kind of broken English, at least I'm generalizing, but that's what I've seen in Latin America. And certainly doctors, I mean, most of doctors do not , uh, speak , uh, English really well. They understand they can read, but the oral skills or just , uh, writing skills are not there. Alright , so the other topic that I usually ask , uh, my guest , uh, sheriff is about their go to market strategy. But in your case, you already answered that I think, unless you wanna get a little deeper into your answer. But , uh, you said that you had a , a very passive approach to Latin America where you were not really targeting the region proactively, you just got a request from a distributor in Colombia , and that's how your curiosity <laugh> in the region got started. But , um, in the other countries, I mean, were you actively pursuing business in the other countries or you started first with Columbia with this shooter and then you waited and suddenly somebody else from Chile came along and knock on your door? Or how was it that you started expanding into other countries?

Sherif Kandil: 24:09

Yeah, so as I mentioned earlier, that contact with the doctors was very important. And since we started to work in the Latin American market, we started to find more potential. And that's where we started to invest more in the right resources like sales and customer service , uh, Spanish speaking as I say, and started to study the markets in order to know what's the next step or where exactly could we start to expand. And by the way, I I maybe I dropped one country, not because it's small or anything, but because it's quite new surinam, we're, we're having quite a good activity in Surinam in spite of still a small country in, in Latin America, but it's also quite active, at least with us. And yeah, so we started with contacting doctors and these are like at the lower part of the whole value chain. So basically what usually happens is either you contact like companies that bridge this gap here in Germany, or you contact darkly distributors or agents, or you could go for franchising , um, in, in, in Latin American countries. Or you could go to a sub-level where you could deal with directly with the doctors or even at the lowest part of the value chain, which is directly with the patients. And so we chose in some countries that I mentioned a while ago, like starting with Brazil and Chile, where we start to contact these doctors by ourselves. And the contact is through many ways whether social media or, or even calls and introducing our product and that we deliver to the Latin American market. That was the approach that we headed for in these countries. And from there it went up afterwards through referrals to distributors. So I would say we did not like double down on the Latin market a hundred percent , uh, from the start, yet we're discovering this a lot. And I mean we we're seeing this potential that we might have not focused on before yet we're focusing on a lot nowadays and grading a strategy to penetrate the market even further because we think that our product has, or it matches the, the cosmetic demand that is there. It matches the price factor as well in comparison to our , um, competitors in the market. And the third thing is that the business model that we apply is after distribution. We go for franchising and this makes it way much faster in terms of service. We have much better in terms of price. And that's something that the Latin American market , uh, primes a lot and um, puts it like on the priority number one. That's basically how we did it. <laugh>.

Julio Martinez: 26:48

Very good. Excellent. I'm really happy to hear about your success in Latin America, especially in Surinam . You know, it's the first guest <laugh> that I've had here in the show that talks about Surina and even those small countries. It's , it's still there, but nobody talks about it because they don't even speak Spanish. So they don't really fit within the Latin American <laugh> culture.

Sherif Kandil: 27:06

I'll even tell you something, Surina , I mean the first time that , uh, the global team told me, Hey, we have some interest on Serina . I first, I did not know where Surinam is, and I thought to myself, it's really, it's like out of really ignorance it , I told them , ah , isn't that in Asia? And they told me, no, that's in Latin America. And I was like, oh my God, that's so embarrassing. Okay, where is that on ? And they just like, check Google maps and oh my God, it's really in Latin America. And I was just checking, oh my God, they have amazing beaches. Why isn't this country? So like, you know, like people are hearing about it a lot or something. <laugh> , I dunno .

Julio Martinez: 27:39

I agree. Yeah, the other country that's like that is Guana , right next to Syriana , you have French Guana and then Guana French Guana is still a French territory. It's a French department and Guana is also, it's an independent country as like Syriana . And Surinam used to be a Dutch colony, if I remember correctly. But the other country that I also wanted to mention in Central America is Belize. Belize was colonized by British. By the British and they speak English. Yeah , <laugh> . So it's ,

Sherif Kandil: 28:09

Yeah. Wow. If I recall correctly, I read it somewhere, it's like over 600 million in terms of population in Latin America.

Julio Martinez: 28:16

Yes. Over 30 something countries, 33, 35 countries in Latin America. Yeah, it's a huge , uh, region .

Sherif Kandil: 28:23

It's, it's an undiscovered potential I'd say. I mean there's a lot, a lot to do there.

Julio Martinez: 28:26

Yes, agree . The issue with Latin America sheriff is that it's very fragmented is like Europe was 50 years ago, something like that. There was one initiative in the South me Sur , Brazil, Argentina, Venezuela, and some other country around <inaudible> now . But that hasn't really taken off internationally. But the other economic block that is really, really taking off is what is called the Pacific Alliance, which is , um, Mexico, Colombia , Chile, and Peru. And it's really, really taking off. It's for the purpose of our discussion, it is gonna create a market of over around 300 million people and it's gonna probably be the eighth or ninth economy in the world, and it's also gonna have single regulatory market. So whereas if you get approval in one country, the idea is to is for that approval to be recognized in the other member countries, which is really good for companies that are looking to enter the region because otherwise you have to get approvals and find the shooters and, and do things differently in every single country , uh, which costs money and uh , takes time and all that. Anyway. So let's keep moving here and let's discuss demand generation briefly . We're running out of time, but I'd like to hear your thoughts on your initiative to help the user generate demand. I mean, do you do co-marketing activities with them? How do you get together to the end user to generate demand for sales?

Sherif Kandil: 30:01

Yeah, well, I , I won't lie. I mean, this is one of the most toughest parts is the support that we could give afterwards in terms of marketing or sales. And , um, our product is, is a very like , um, high niche product that needs a lot of scientific support as well. And since our reference doctors, I'm one of them . And and also like three others, none of us speak neither Spanish or Portuguese. It's very tough for us to supply that kind of service till this date. And I mean, we're working on it for sure, but yet to have it in house is a different story. And that's one of the things that I would give as a tip, a recommendation for anyone who wants to get into the Latin American market. You gotta be prepared for it. 'cause I mean the demand is there, but you have to be very well prepared for it from the legislative side , uh, atory side, I mean, and also from like localizing or adapting your language, your, your prices and so on. Because if you find this true potential there, things will just go passively or organically by themselves afterwards without doing a lot of effort. And again, because already so many other competitors of ours are facing the same problems or even more , uh, so they just tend to like avoid the Latin American market. 'cause for them it's like a lot of headache. We need to employ people and it needs like a different budget. We've gone like half the way there and still there is so much to do. It's just the beginning where we're standing right now. But yeah, I mean this is the kind of support that we believe is very important is supporting sales and marketing, like attending or , uh, participating in trade shows, congresses in Latin America , uh, giving lectures there like live lectures where we gather , uh, hundreds of doctors in in like , um, conference room and a teller whatsoever. And we give like certification course about our product. These kind of support endeavors are remarkable in, in their effect. However, we still are on the first path to implementing that in the correct way in the Latin American market.

Julio Martinez: 32:05

Great. Sharif . All right , let's talk about pricing briefly as well. You mentioned something at the beginning of the conversation, but I'd like to get your thoughts on price sensitivity in Latin America. I don't know if you have many competitors or not. Uh , I don't know if you've had to reduce your pricing to fit what distributors were asking you for in Latin America. I mean, what's your experience here?

Sherif Kandil: 32:28

Um, since nowadays the local manufacturers in Latin America are popping like mushrooms so fast. So it's making our cutting advantage with the price very tough. However, that has led us to implement more of franchising in the market where we teach or , um, prepared one of the distributor or switch them from being a distributor to a franchisee where they good manufacturer , uh, locally. And again, it's something that I mentioned a while ago, so it's like we totally eliminate all the physical logistics between Germany and Latin America or in locally where the franchisees is located. And I think that is one of the things that helped us a lot to decrease the price. I mean, in the Latin American market, we are talking about like an order of almost 50% less in terms of price than, than the German market. So the price sensitivity is very, very high. And still combining that with this huge desire to have beautiful teeth makes them , uh, choose like just darkly better service and better price and sometimes ignore the quality of, for example , um, a product as , uh, coming from outside , uh, Columbia or whatsoever. So we're trying to bring this design, technology and intellectual property inside the country locally and manufacture it locally in order to combine the two advantages of price , uh, competitiveness, and also the quality of the design that we have for the product itself.

Julio Martinez: 34:06

Very interesting. Sheriff , I'm very , uh, <laugh> impressed with the way you've managed to adapt to the needs of the region and remarkable because you've had to switch , uh, your model a little bit , uh, to more as , uh, to a franchise model, which is quite unique. I've never really heard that from any other medical device manufacturer in this podcast, so congratulations, <laugh> , I mean , <laugh> . Very good. All right , Sharif , moving along before the end of the show. Two more questions. Uh, the first one is about corruption and bribery. A lot of people think that Latin America is corrupt and it's just difficult to do business 'cause of that. I mean, where are your thoughts on this?

Sherif Kandil: 34:45

Well, we didn't have any experience with corruption in the Latin American market, but maybe a reason for that is that we were not involved in the clearance of , um, of the products or whatsoever, and we're not , um, supplying any kind of like , um, a a serial product again, as we said. So it's basically it's done only according to demand. So they send impressions for specific patient X and we send back the aligners for patient X. Exactly. That's what doesn't give us like , uh, much of in-depth understanding of the corruption in the Latin American market.

Julio Martinez: 35:16

Yeah. And also you are not selling into hospital systems , uh, owned by the government. You're not bid on on request for proposals and, and things of that nature. So you're kind of , uh, aside from that. Alright . And the last question that I usually have , uh, before the closing remarks , uh, Sharif is, is Latin America a fun place to do business? <laugh> ? I mean, what do you think about the culture and the way people do business in the region?

Sherif Kandil: 35:43

I love it. It's on my bucket list. You know, it's one of my dreams to go to Latin America and visit like almost old countries over there, even Surina that I just , uh, get to know like only a couple of weeks ago. But yeah, I mean it's it's one of my dreams for sure. I mean the people, the , the , I mean I love Spanish, but unfortunately I cannot speak Spanish can understand a bit the culture, the cuisine, the everything, how people deal together, how it's , uh, there is ease of communication and ease of like social communication. That's something I find like very interesting and makes me want to visit Latin America.

Julio Martinez: 36:21

<laugh>, especially compared to Germany. I mean the culture in Germany very stiff and cold <laugh>.

Sherif Kandil: 36:28

Yeah, I I <laugh> I believe that too. I mean it's a huge gap or difference and , um, I mean someone , our family is German and , uh, his , um, his girlfriend, she's , uh, from um, Chile and whenever they come to as a visit, I mean you, you directly see the huge difference, but it's, it's, this is what's so beautiful about it is to, is to see this harmony , um, in spite of the , the disharmony that could be there.

Julio Martinez: 36:56

<laugh>. That's a great way to say it. <laugh>. All right , sure . Before we sign up for today, do you have any final thoughts , uh, mores of wisdom or other museums for our listeners? In other words, what would you say to the CEO of a small or midsize medical device company that hasn't ventured into Latin America yet?

Sherif Kandil: 37:18

A very good question , um, to close today's , um, podcast with, and I would like reiterate once again on the fact that getting into the Latin American market, the , the potential is huge. Um, but you have to be very well prepared for it. And studying the market before getting into it is absolute must for sure. But studying the Latin American market is absolute must with like two lines underneath and especially the Portuguese market like in , um, or I mean the Portuguese speaking market, like in Brazil, it's just a , like a totally different thing. It's like flipping the other side of the coin. And yeah, I mean, having the right resources is the most important and dealing with a country that, or sorry, a continent that is very price oriented and um , has a huge demand for aesthetics is quite an important thing , uh, to have in mind. Adding to that, just that the technology that reaches Latin America sometimes is quite delayed and for all the reasons that we have mentioned throughout the podcast, the barrier of language and the resources that you need to prepare for, et cetera, et cetera , uh, sometimes that makes the technology reach there quite late, which could be an advantage for some companies. A CEO of a company in Germany for example, could have this cutting advantage of having a great product, great technology that is still not there the way it is in Germany and still not there , um, in , in Latin America. So you have the product, you just need the method to get into the market. That will be it.

Julio Martinez: 38:52

Well said. Excellent. Thank you for that comment. Alright , uh, sheriff , how can people get in contact with you and your company?

Sherif Kandil: 38:59

They could just reach out directly through my email , um, address it's , uh, sheriff@clearexcelaligners.com . Otherwise , uh, yeah, I'm , um, I think I'm quite available on YouTube as well. <laugh> , I mean our , our website is clearex aligners.com and that's where , um, I write even like blogs on , on the website by myself. I , I love to write a medium if someone is interested to read more about blogs related to the future of orthodontics, the future of the dental field worldwide. And um, and astrophysics as well. <laugh> if somebody's interested in that. <laugh>.

Julio Martinez: 39:32

<laugh> . Interesting. Okay. Fantastic. I mean , <laugh> quite uh , diverse set of topics there. Alright , Sharif , thank you so much for being a guest in our show. I really enjoyed our conversation and I'm sure listeners also learned a few tips , uh, here and there from you. And I look forward to being in touch

Sherif Kandil: 39:56

Me as well. Thanks a lot. Yeah, it was been great talking to you. And yeah, it's uh , it's my first time to share , um, my experience and knowledge with everyone listening to this podcast. I hope it was useful as well as enjoying enjoying for everyone who listens to it. And , uh, yeah, we'll be in touch once again.

Julio Martinez: 40:12

Okay, sure . Bye-Bye. Take care.

Sherif Kandil: 40:15

Great , thanks. Bye-Bye.