Can Billy Sims Revolutionize the Way the U.S. Sells Food to China?

It’s not every day I get an e-mail pitch that begins, “Hello, my name is Billy Sims, I am the 1978/ Heisman Trophy Winner and former all pro running back for the Detroit Lions.”

As a lifelong Lions fan and a beast on the fantasy football field (ahem), I didn’t need any further prompting. We arranged to talk on the phone and I spent 45 minutes learning about Sims’s next potentially legendary feat: To conquer the Chinese food production market through a series of joint ventures, called the Billy Sims/China Food Group, on American soil.

But let me back up for those of you who aren’t football fans. Billy Sims was born in 1955, and by the 1970s he was breaking high school football records for rushing yards in his native Texas. He went on to play football for the University of Oklahoma, won the Heisman, and then spent his professional career playing for the Lions in Detroit. In 1983, he earned the nickname “Kung-Fu Billy Sims” from ESPN for a play where he karate-kicked defenders out of his way as he ran toward the goal line. That never-quit attitude has continued to serve him well in his post-football career as an entrepreneur.

So to anyone who wonders what the heck Billy Sims knows about manufacturing food for the Chinese market, he has this to say: “All my life, I’ve been told what I’m not going to do—I live off folks telling me what I can’t do. I just find another way to do it.”

Though Sims has had his hand in numerous business ventures over the years, he’s perhaps best known for his successful chain of more than 60 restaurants nationwide called Billy Sims Barbeque. Last year, he formed his new company after learning more about the multi-billion-dollar market that exists in China for food production, and how to satisfy the cravings of China’s nouveau riche.

“The idea first came up three years ago, when I was selling real estate to Chinese investors,” Sims explained. “I made some friends and one thing led to another.”

Soon after, Sims met Siva Yam, the president of the U.S.-China Chamber of Commerce, and in talking with him, Sims discovered that many Chinese people are aspirational eaters, so to speak: They like products imported from North America because they consider them to be higher quality with less chance of contamination, an issue that has dogged China as it has experienced astronomical growth in the past decade.

The tastes of the Chinese population are also changing, according to Sims. They’re increasingly developing an appetite for dairy products like whole milk powder, which is not traditionally a part of the Chinese diet but has become a coveted source of baby food, and the demand can’t be satisfied internally for a number of reasons. Chinese producers have a hard time meeting quality standards, Sims said, and even when they do, the grazing land and feedstock available to raise dairy cows is limited.

Sims immediately saw a big opportunity for American food producers. The demand for U.S. dairy products in China has followed recent export trends for other goods like meat, corn, nuts, and wine. According to Bloomberg Business, in the first quarter of 2014, the value of U.S. dairy exports grew 39 percent.

After his conversations with Yam, Sims began an intense, six-month due diligence process where he investigated the merits of the proposed business case. Sims and his co-founder, David “Chief” Tomby, began forming the Billy Sims/China Food Group team, and they hired Kevin Zhang, a native of China with a 25-year business career and a long track record of facilitating trade between the U.S. and China, to be his director of China operations. The company also brought on Mengniu, one of China’s largest dairy enterprises, as a partner.

Sims also contacted his former Oklahoma teammate, J.C. Watts, who represented Oklahoma’s fourth district in Congress from 1995 to 2003 and is now a lobbyist. Watts was able to open more doors for Sims in China. Sims attempted to broker a “huge order” of whole milk powder for his Chinese contacts, but was temporarily thwarted when he was told the amount of powder he was seeking was more than the total produced at all U.S. plants in a year. He realized he was going to have to fight his way to another solution.

At first, he thought he might build a factory in China, but after numerous discussions with Chinese partners and other experts on the Chinese food market, he was advised to take a different approach: Build food hubs in the United States—each containing four separate factories co-owned by Billy Sims/China Food Group, Chinese food corporations, and American producers—to manufacture food products exclusively for export to China. And dairy is just the beginning.

One food hub, for instance, might manufacture whole milk powder, salad oils, candy, and soft drinks. Sims plans to name his product line after an ancient Chinese city (not yet disclosed), and estimated the first food hub would cost $300 million to build.

“What the Chinese want is to do it themselves or to do a joint venture,” Sims said. “The White House said offer a joint deal, so that’s what we did.”

Sims said Chinese investors responded enthusiastically, and he now finds himself “very close to pulling this off.” The company conducted a media campaign in China that drew tons of press, Sims said, and helped make him a household name. (Sims claims he’s more famous in China than in the United States.) He used that notoriety to get his foot in the door with potential backers.

“When Billy Sims comes to China to talk about joint ventures, and we’re the first ones talking about anything like that, it’s news,” he added, saying that his is the best-selling football jersey in the country. “You can be rich and nobody wants to meet you, but people want to meet a so-called star.” Sims said he plans to reach out to former NBA basketball star Yao Ming to be part of future ad campaigns.

After securing his initial Chinese partners, Sims is now on a quest for stateside investors. The company is meeting with U.S. venture capitalists and private equity firms, while also—to sweeten the deal for Chinese investors—pursuing an EB-5 designation, a visa category created in the 1990s for immigrants willing to invest at least $500,000 in an American business or project that creates at least 10 jobs over three and a half years in a targeted area like Detroit. Sims has also gotten pledges of support from the governments of Michigan and Nevada, and that’s where he plans to locate the first food hubs, though there are no specific sites yet. After the first hub is built, Sims said it will be up to his Chinese partners to determine what products are made at future food hubs.

Sims is also working on bringing an “amazing group” of Chinese businesspeople and agriculture officials to the U.S. for an informal trade mission. He clearly feels that Michigan’s governor, Rick Snyder, snubbed him on past state-sponsored trade trips to China.

“A lot of companies in Michigan would like to sell to China, but the doors are closed,” he said. “The governor only picks certain people to go on these trips, and the only real progress China has made so far in Michigan has been in [Gov. Snyder’s hometown of] Ann Arbor. Our mechanism opens the door for farmers and producers who want to sell to China.”

Sims seems determined to understand and accommodate Chinese culture and the way people do business. He tells a story he heard from his Chinese contacts about a visiting delegation from one of the biggest dairy corporations in the U.S. They came bearing green hats and gave them to their Chinese hosts, promptly kicking off one of those “needle scratching across the record” moments. In traditional Chinese culture, green hats are considered taboo—to wear one means you’re either a cheater or a cuckold. After that faux pas, the dairy conglomerate’s dreams of doing business in China came to a halt.

“We want to take advantage of all the mistakes others have made,” Sims said.

It certainly won’t be easy. As he waits for a U.S. investor to materialize, the Billy Sims/China Food Group, which has 11 employees and is based in Michigan, is moving ahead with its plans. Sims is confident that the market demand in China and his innovative idea for jointly owned food hubs will eventually pay off.

“The Chinese are very warm people, and once they say yes, they say yes,” he said. He employed a sports metaphor to describe his company’s progress and the work yet to be done: For an old running back like Sims, getting the ball down the field for the first 80 yards is mostly a game of catch—the real action comes once you get close to the end zone, he said. “Then, for the last 20 yards, we have to play some football.”

Sarah Schmid Stevenson is the Custom Content Editor for Xconomy Insight. You can reach her at Follow @Xconomy

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