EXPORTING ESSENTIALS: SELLING PRODUCTS AND SERVICES TO THE WORLD SUCCESSFULLY (2014)
Chapter 4. Exploring Your Territory
How to Research and Pick the Best Foreign Market
Only 1% of the businesses in the U.S. today actually export. So that’s a big part for our inspiration, to make it easier and easier for companies to compete in the global environment.
—UPS Chief Financial Officer Kurt Kuehn1
Once you’ve decided on a product or service to export, you’ve got to find an export market where you can sell it profitably. At this point, I am assuming you know what you need to do to get export ready based on the results of the export readiness questionnaire you took in Chapter 1. As for market research, it can be a slow, painstaking, and tedious chore, but as you add to your knowledge, by tracking the movement of goods and tapping into the world’s networks of purchasing and distribution, you will create your own living and changing map of international trade that will serve you throughout your export business.
There are a variety of methods by which a company can locate the best—meaning the right—potential foreign markets for its product or service. This chapter outlines a range of efficient methods for researching export markets, focusing on where to get export-market data and intelligence, and how to use it.
Since you will be consulting a variety of resources, you will want to take some time to plan your approach. In this chapter, I offer you ways to nail down specifics about your product, your consumer, and the market conditions necessary to support healthy sales of your product—all of which will help you to identify a hot target market when you move on to your research.
You will be assembling information about two kinds of customers: the everyday citizen who buys goods for personal use (B-to-C) and the various high-volume traders who buy goods from you to sell to other businesses (B-to-B). I will provide you with numerous ways to find out about both kinds of customers, so that you can determine what modifications, if any, will be needed to prepare the product for your target markets. You’ll find that there are dense networks of information and support, largely government sponsored, for every aspect of the development of your export business. Most of these sources of assistance are easily accessible online and within the reach of even a modest operating budget. Once you have a good idea of where and how to direct your marketing efforts, you can create an action plan to get your export program underway.
Caution In the words of the late Steve Jobs: “Some people say, ‘Give the customers what they want.’ But that’s not my approach. Our job is to figure out what they’re going to want before they do. I think Henry Ford once said, ‘If I’d asked customers what they wanted, they would have told me, ‘A faster horse!” People don’t know what they want until you show it to them. That’s why I never rely on market research. Our task is to read things that are not yet on the page.”2 Keep Jobs’s remark in mind as you conduct your market research, and use gut instinct, humanity, and commonsense as you research data. But don’t get analysis paralysis where you keep researching but never take action. That’s the worst outcome. And never forget the end user—the customer—for that is who buys the products and services.
Market Research—a Dreaded Chore, a Powerful Tool
One of the tasks I dreaded while getting my business underway was conducting market research. I hated it because it cost both time and money. When I promised a potential supplier that I would study a foreign market to determine whether it would be receptive to the product, I would rack my brain about (a) how I would go about it and (b) how I would go about it inexpensively!
Sometimes you’ll get lucky and an inquiry will land in your e-mail inbox pointing you right to an ideal market for a product. For example, you might have a friend who runs a company in Botswana and loves a certain type of sandal but can’t find it there. He contacts you and asks you to source a supplier of the shoe or an equivalent product. You now have a country (Africa) to export to, a potential buyer (your friend’s company) to sell to, and a product (a sandal not available in Botswana) to offer. Furthermore, now that you know that these sandals or anything like them are not sold in Botswana, you’ve been alerted to an untapped market that you can develop on a larger scale. But don’t take these windfalls for granted. If you want to keep the orders coming in, you’re going to have to ramp up your social media conversations and go out and approach customers. Market research tells you where customers can be found.
Your first market research project is usually the toughest because it’s all unfamiliar terrain. But once you have searched out the data you need in order to predict how a specific type of product will sell in a specific geographic location, you can use the information over and over again as a guideline for exports of similar products in the future. As you build your personal information database on global markets and learn to keep yourself up to date on developments in international trade, it will become less and less of a chore to determine where to take your product. You will find that market research is a powerful tool for exploring and taking control of your export territory.
Get Yourself Organized
There is no getting around the fact that market research is not a tidy, linear process! It involves several closely related objectives: to put together a working profile of your actual consumer or end user; to determine if the country’s market conditions (its economy, demographics, level of political stability, trade barriers, distribution system, competition, transportation, and storage, etc.) will favor or hinder your product’s success; and to identify the people who will buy your product from you (consumers, wholesalers, importers, etc.). Before you consult your resources, I recommend that you sit down with pen and paper or PC (it can be a tablet if you prefer), and try the following procedures to help you structure the task. The idea here is to establish a few attractive or promising directions for your investigations and to clarify exactly what kinds of information you’ll be looking for.
Choosing Your Market—Pleasure, Profit, Competitive Advantage, or Challenge?
In Chapter 2, I talked about the various motivations that might guide your choice of a product to export. When deciding where to concentrate your sales efforts, the same range of motivations comes into play. You should choose a market that intrigues you, presents a competitive advantage, or offers a challenge and then consider products that you might want to sell there. You will be visiting this market frequently and getting to know its people intimately, so, just as you should pick a product that will delight you for years to come, you should plan on exporting to a country that delights and fascinates you. If you are enthralled with French culture and you are excited at the prospect of cracking that market, then you want to sell France. If you have dolls to sell, you should sell them to France. It’s a place to start! But use commonsense: Don’t ignore other countries that offer good prospects for your dolls, and don’t expend too much time and energy on your first-choice market if it turns out to be a poor prospect. The trick is to find the right market.
Tip Even though in Chapter 2 I talked about selecting a product that is wildly successful on the domestic front to export, don’t overlook the possibility and opportunity of selling products that are less successful in the United States, as they could be in high demand elsewhere. Say you manufacture two different types of dolls—one that uses high-end materials and is very expensive and the other low end and quite inexpensive. The glamorous high-end doll sells magnificently in your local market, but the moderately priced doll is more appealing and affordable overseas. The only way to discover this is through extensive research of foreign countries.
If you start your market research and find out that there’s no demand for dolls in France, you can always move on and pick another market. But stick to dolls because that’s what you manufacture and are comfortable with and knowledgeable about. Unless you’ve exhausted all of the options on your product of choice, it’s best to stay as close to your original plan as possible—entertaining too many possibilities can put you off track and cause you to lose your confidence and enthusiasm.
If easy profits with minimal effort and exercise of business ingenuity are your priorities, you can just use your domestic market as a model. If you take a careful look at where, to whom, and why a product is selling well in your country and then locate markets abroad with similar demographics, chances are that the demand will be similar. A bonus: minimal product modification, if any, will be required.
Segmenting Your Product and Market
Another important aspect that will help you focus your research is categorizing or segmenting your product and target market by making lists of the relevant factors. Take the dolls, for example. What type of dolls are you going to export? Baby dolls? Antique? For boys? For girls? Talking? Education? Under each product segment, list the categories of likely customers until you reach the end user for your product. Once you determine who your customer is, what she buys, when she buys, how often she buys, and why she buys, you’ve got a customer profile. For example, your customers for girl’s dolls might include manufacturers, wholesalers, independent doll shops, big box stores, and e-commerce platforms, as well as private citizens. Push your lists as far as you can—it might take anywhere from one to ten categorizations before you can reach optimum segmentation.
Use a format like this for your list:
1. I’m going to export: _____________ (product)
2. Specifically these types: _____________ (type of product), _____________ (type of target customer), _____________ (type of buyer).
3. I’m going to export to: _____________ (country)
Your completed list might look like this:
1. I’m going to export “dolls” (product).
2. Specifically these types: “educational dolls” (type of product), “for girls ages seven to ten” (type of target customer), “to importing wholesalers of educational toys and direct via e-commerce” (type of buyer).
3. I’m going to export to “France” (country).
Through this exercise, you will sufficiently narrow down search categories so that you are ready to conduct a search via Google, Bing, or Yahoo. You will also be ready to send an e-mail to a trade officer to ask a specific question or set up an appointment with the Small Business Administration or US Export Assistance Center for help. Refer to your list and refer to it frequently to keep you on track.
Will Your Product Succeed in Your Market of Choice?
Once you have a good idea of what you want to export and where to, you can fill out your picture of market conditions by answering questions like these:
1. Who will buy your product and why?
2. What is the size of the market?
3. Who is your competition?
4. How competitive can you be?
5. How new is the product to the market you have selected?
6. Are there growth opportunities in the market?
7. What do the country’s demographic profile, economy, and mass culture look like right now? (Its macroeconomic indicators such as GDP growth, employment, and birth rates will give you an overview of the state of the economy and population.)
8. Are there demographic, economic, or cultural trends that will shape the market in the future?
9. Does the country’s government help or hinder the sale of imported goods? For example, are there any barriers to entry or to sales within the market?
10.Will the country’s climate or geography present logistical problems for sales of your product of choice? For example, selling chocolates to countries with warm climates such as in Brazil.
11.Does the product have to be adapted to your target market by way of a physical reconstruction, a new package, or a change in servicing practices? (See Chapter 6 for more details on preparing your product for export.)
12.Does the product have the same use in the international market as in the home market?
13.Does the product require personal after-sales service and, if so, can you provide it in the prospective market?
Tip Many new exporters look at where their competitors are exporting to and then investigate country and industry reports to identify the export trends and growing markets for their product or within their industry. Trade associations, US government online portals, and reports from other global organizations are an excellent source for this type of information. Because Canada and New Mexico border the United States and are a part of NAFTA, they are a good starting point for new exporters.
Use your own business sense and add to the list. Once you actually start your research, more questions will arise. This is all part of the process of turning your vague ambitions into a concrete strategy based on market realities, so the more smart questions you ask and answer, the better your chances of success.
Once you have narrowed down your options and answered all the questions, take the following steps, focusing on nine key areas (many of which—numbers 4 through 6—can be accomplished through the helpful guidance of a good logistics specialist):
1. Conduct a country assessment that examines the country’s geographic, demographic, economic, cultural, political, and legal systems and infrastructure.
2. Perform a market assessment that examines the size, characteristics, and projected growth of the target market.
3. Examine your competitors’ products, prices, marketing methods, and distribution channels.
4. Find out if there are any licenses or certifications needed to export to the country (refer to Chapter 13).
5. Learn about any tariffs and import regulations that will affect you (see Chapter 9).
6. Classify your product using one of the following commodity classification codes: Harmonized Tariff Schedule (HTS), Schedule B number (refer to Chapter 9), North American Industry Classification System (NAICS), or Standard International Trade Classification (SITC). Each of these classification systems allows you to assign a six-to-ten digit code to commodities so that trade data can be collected and analyzed in a consistent manner. For help with any of the terms or concepts, visit export.gov’s “Trade Data & Analysis” (http://export.gov/tradedata/index.asp).
7. Determine how you will distribute your product or service (using an agent, distributor, wholesaler, or e-commerce fulfillment—more in Chapter 8).
8. Figure out your global competitive advantage. What are you bringing to the marketplace that no one else has or can offer?
9. Test demand. Do a trial shipment to an interested customer, exhibit at a trade show, participate in a catalog-only show, or utilize a foreign-partner matching service. All of these methods allow you to sample test the market, determine interest, and find out whether people will buy your product.
Tip Don’t rely entirely on the amount of visitors to your online platform as a predictor of the e-commerce market demand for your product or service offering. Google’s Adwords program can give you an idea of how many monthly searches there are for specific keywords, say “tablet cases,” or phrases that relate to your product. A high volume of searches for one specific term does not necessarily ensure high market demand for your product, but it does provide a good starting point. Once you understand the market demand for products similar to yours, you can tailor your own Web site to meet the demands of consumers who may have an interest in your product. But again, this is all tied more to e-commerce and doesn’t necessarily indicate the demand of those who don’t use digital for purchases.
Export Market Data: Where to Get It and How to Use It
The following resources offer a wealth of information on international trade. This list is not in any particular order; I recommend that you begin with whichever of your chosen resources is easiest to access. Once you’ve begun acquiring a body of knowledge, you’ll have a better idea of where to direct your search. There are both physical locations and Web sites that offer information on international trade.
We’ll start with the physical locations where you can go to obtain information on international trade. Most of them are run by federal government organizations and have multiple branches in all of the states.
Small Business Administration
One of the most important places you should go, and many people’s first stop, in order to seek high-powered export advice is your local Small Business Administration (SBA) office or the equivalent government-sponsored small business support group in your country. When you hit the bookshelves there (many directories are available online, but in person you have the benefit of the assistance of real people), you’ll see directory after directory with intimidating titles like Report FT 410 (the census), HS Code Directory, Trade Profiles (WTO Statistics Database), and so on. Luckily, the staff can help you navigate through them. Many of the people working at these organizations are retired from high-ranking positions in the corporate world and enjoy offering their years of experience to help others get a start. It’s best to come armed with concrete questions to help them help you. Write down exactly what you want to know and what you want to use it for. Don’t just throw up your hands and ask, “I want to export a product somewhere, can you assist?”
The export assistance available from the SBA includes training seminars and legal advice as well as answers to your questions. All export programs administered through the SBA are available through local branches. The SBA also serves as an administrative center for small business development centers; loan programs (funded by private lenders and backed by the government); and services for businesses owned by minorities, veterans, and women. Be sure to ask if you are eligible for these forms of assistance. In addition, each branch typically houses a business library, a computer center for business owners who don’t own their own equipment, and an office of the Service Corps of Retired Executives (SCORE). The staff of SCORE, who work under the SBA’s umbrella, can match up small businesses with mentors who have experience in foreign trade and help new or experienced exporters develop an export strategy.
Department of Commerce
Another stop should be your local branch of the Department of Commerce (DOC) , which houses nineteen different Export Assistance Centers (EACs; find one by going to http://export.gov/eac/index.asp) in the United States that link to one hundred US cities and more than eighty countries worldwide by providing a comprehensive global network. The mission of the EAC network is to deliver a comprehensive array of counseling and international trade services to US firms, particularly small- and medium-sized ones. The EAC offices have the appearance and feel of a private-sector export consulting firm yet it is a federal agency that partners well with state resources and organizations that promote exports. Addresses and phone numbers for all district offices are yours for the asking. The centers give you access to the services of the US DOC, the International Trade Administration (ITA), the US Commercial Service, the Export-Import Bank of the United States, and the US Small Business Administration. Although the programs the organization offers are geared mostly toward experienced, export-ready companies looking to enter new markets, it also offers a boatload of trade and finance assistance to established small- and mid-sized businesses. One-on-one counseling is available. One of the simplest and handiest resources is the pamphlet A Basic Guide to Exporting issued by the US Government Printing Office (it can be purchased from http://export.gov/basicguide/). Although the guide focuses on exports from the United States, it also offers global advice on what is required to export from any point in the world. If the guide is not specific enough for you, check with the government programs that facilitate trade in your own country.
In addition to previously mentioned services, the DOC offers expert advice on export administration, trade adjustment assistance, travel and tourism, and minority businesses, to name just a few. Be sure to ask somebody about your specific situation, even if you don’t see it covered here. More likely than not, there’s someone who can help you. If not, you will be directed to other government service offices that can.
The following list is a sampling of information and services the DOC offers:
· Exporting seminars, webinars, podcasts, conferences, trade missions, and exhibitions
· Offering financial aid to exporters
· Providing information on emerging international-trade opportunities
· Furnishing information on export documentation requirements
· Exporting statistics
· Supplying readings on international trade
· Distributing information on licensing, patent, trademark, and protectionist practices abroad
· Providing counseling on general export marketing issues
· Offering services to help you make cross-border contacts and find agents and distributors (see Chapter 7)
US Commercial Service—An Exporter’s Gold Mine
Ever wonder who gathers all that information on trends and actual trade leads? It’s the US Commercial Service (USCS; http://export.gov/worldwide_us/index.asp; to find the USCS local office near you, head tohttp://www.trade.gov/cs/states/csinyourstate.asp). This wonderful resource is an exporter’s gold mine.
There are more than 1,400 trade professionals, all eager and waiting to help you go global, who are working in USCS’s 128 commercial offices, located in US embassies and consulates in more than seventy-five countries. Most of them have international experience, so they know what it takes to do business in the country in which they’re stationed. They put their invaluable understanding of local culture and prospective customer contacts at the service of the small business owner interested in entering overseas markets.
I used this resource within the first couple of weeks of starting my business. It proved extremely effective. I faxed the American embassy with a specific question: I was seeking a list of reputable food-importing wholesalers that specialized in high-volume product movement throughout Japan. Within twenty-four hours I received a reply from an agriculture trade officer indicating that a list was being forwarded by airmail (well before the days of e-mail). When I received it, I was excited about its potential and began contacting the companies right away. It was an ideal way to get started.
Here are just a few of the services the USCS overseas staff will provide at no charge:
· Customer lists
· Sales representative and other agency-finding services
· Background checks on companies overseas
· Business counseling
Keep in mind that most state governments offer overseas business resource centers to help the small business executive tap into new markets. Check into these as well as the USCS—they usually work in tandem.
Web Sites Brimming with Trade Statistics
There are also many Web sites that offer a wealth of trade information.
TradeStats (http://tse.export.gov/TSE/TSEhome.aspx) provides the latest annual and quarterly trade data, including national trade data and state export data.
USA Trade Online
The Foreign Trade Division of the US Census Bureau hosts USA Trade Online (https://usatrade.census.gov/), which allows you to access current and cumulative US export and import data for more than nine thousand export commodities and seventeen thousand import commodities.
Market Research Index
Hosted by export.gov, Market Research Index (http://export.gov/mrktresearch/) provides a step-by-step guide on how to get started in market research. In addition, you can access the Market Research Library run by US Commercial Service (http://www.buyusainfo.net/adsearch.cfm?search_type=int&loadnav=no), which comprises more than one hundred thousand industry- and country-specific market reports authored by specialists working in overseas posts.
BusinessUSA (http://business.usa.gov/) is a centralized, one-stop platform designed to make it easy for businesses to access services to help them grow (through exporting) and hire, regardless of where the information is located or which agency’s Web site, call center, or office they go to for help.
United States International Trade Commission
The Web site of the United States International Trade Commission (http://www.usitc.gov) aims to administer US trade-remedy laws; provide the president, the United States trade representative (USTR), and Congress with independent quality analysis, information, and support on matters relating to tariffs and international trade and competitiveness; and maintain the Harmonized Tariff Schedule of the United States. Its goal is to contribute to the development of a realistic US trade policy.
Run by the US Department of State, USEmbassy.gov: Websites of US Embassies, Consulates and Missions (http://www.usembassy.gov/) provides links to the Web sites of the diplomatic organizations in many countries and features business information specific to those countries.
World Trade Organization
The World Trade Organization (WTO; http://www.wto.org/) is an organization that focuses on opening up trade and sorting out trade problems as they arise. It is a forum for governments to negotiate trade agreements and a safe haven for them to settle trade disputes. It operates a system of trade rules.
Other Federal-Export Assistance Resources
There are also a handful of other organizations designed to assist you with federal exports.
Export-Import Bank of the United States
The Export-Import Bank of the United States (Ex-Im Bank; http://www.exim.gov/) is a government agency that is responsible for assisting the export financing of US goods and services through a variety of loan guarantees and insurance programs (see Chapter 11).
Foreign Agricultural Service
The Foreign Agricultural Service (FAS) of the US Department of Agriculture (http://www.fas.usda.gov/) provides a network of counselors, attachés, trade officers, commodity analysts, and marketing specialists to assist in making contacts overseas. Check with your state or regional department.
There are also various other agencies that may come in handy during your search for federal-research assistance. Although you probably will not need to contact these agencies at the outset of your operations, you should know about them. They are: The Overseas Private Investment Corporation (OPIC; http://www.opic.gov/); the US Department of the Treasury (http://www.treasury.gov/Pages/default.aspx); USAID (the US Agency for International Development; http://www.usaid.gov/); and the Office of the US Trade Representative (http://www.ustr.gov/about-us/trade-toolbox/us-government-trade-agencies). Most of these resources are available through the office of your local chamber of commerce or Small Business Administration. Check the Web sites for further information.
Local Colleges and Universities
Another important resource is the colleges and universities in your state. Contact them to see what type of international assistance they offer to small businesses interested in expanding overseas. You’ll find that nearly every major university offers what is referred to as a university outreach or partnership program, which extends university resources to individuals, groups, and communities. During the past few years, most campuses have focused on international development opportunities, offering services such as trade assistance, promotion of state exports, and trade research. Southern Illinois University Edwardsville (http://www.siue.edu/business/itc/), Michigan State University (http://globaledge.msu.edu/), and Bradley University (http://www.bradley.edu/academic/colleges/fcba/centers/turner/sbdc/), for example, all have programs in place. Michigan State University also offers a great resource called MPI (Market Potential Index: http://globaledge.msu.edu/knowledge-tools/mpi) to evaluate the potential of emerging markets as well as DIBS (GlobalEDGE Database of International Business Statistics: http://globaledge.msu.edu/knowledge-tools/dibs) that allows you to choose from thousands of variables in order to generate reports that synthesize and evaluate data from reliable sources.
In addition, many state and private educational institutions offer courses in exporting or going global. They may even cosponsor international trade seminars with federal agencies or private-sector organizations. If you cannot find a school in your area that offers this type of service, be sure to search the Internet.
Business Intelligence Companies
For those who find visiting agencies in person too intimidating, time consuming, or just plain old fashioned, the following business intelligence companies arm you with critical and competitive information on US waterborne trade activity through an online searchable trade database, covering international trade activities throughout the world, for a fee: PIERS (http://www.piers.com), Datamyne (http://www.datamyne.com), Zepol (http://www.zepolcom), and ImportGenius (http://www.importgenius.com).
Tip A little-known publication that is a huge source of trade data is the Journal of Commerce (JOC; http://www.joc.com). The magazine offers everything from a listing of the top hundred US exporters (including the top ten states exporting to China) to import/export trade leads and international trade news. What can you quickly glean from the data? Let’s say you see a lot of container shipments being exported to Brazil. Why is this happening? What is the commodity? What should you be looking at or doing relative to that kind of movement?
Other Places to Look for Market-Research Help
The following resources and tools offered by organizations provide advice and insight as well as statistics on international exporting:
Produced by the US Census Bureau, Foreign Trade (http://www.census.gov/foreign-trade/) is responsible for issuing regulations governing the reporting of all export shipments from the United States. It is the official source for US export and import statistics. If you’re searching for import or export statistics, information on export regulations, commodity classifications, or a host of other trade-related topics, this is the place to get the information you need.
The Export Practitioner
The Export Practitioner (http://www.exportprac.com/) is a monthly magazine devoted to providing news and analysis about the export-licensing requirements and the law-enforcement activities of the commerce, state, and treasury departments. The information provided in the advance reports help you better understand an issue and, at the same time, avoid costly legal troubles.
Ease of Doing Business Rankings
The Doing Business site, run by the International Finance Corporation and the World Bank, ranks economies on their ease of doing business, on a scale from 1 to 185 (http://www.doingbusiness.org/rankings). A high ranking on the Ease of Doing Business Index means the regulatory environment is more conducive to the starting and operation of a local firm. The index provides a bird’s-eye view on the potential of exporting to a given economy, too.
The World Factbook
The World Factbook (https://www.cia.gov/library/publications/the-world-factbook/) is a reference guide produced by the Central Intelligence Agency that provides detailed information on history, people, government, economy, geography, communications, transportation, military, and transnational issues for 267 world entities.
US and World Population Clock
Produced by the United States Census Bureau of the US Department of Commerce, the US and World Population Clock (http://www.census.gov/popclock/) is a continuously updated population estimate based on earlier census figures, which serves as the leading source of quality data about the nation’s people and economy.
World Bank Atlas Method
The World Bank Atlas Method (http://data.worldbank.org/about/country-classifications/world-bank-atlas-method) uses the Atlas conversion factor to minimize exchange-rate fluctuations in the cross-country comparison of national incomes.
Euromonitor International (http://www.euromonitor.com/usa) provides market research, business intelligence reports, and on data in strategy research on consumer markets.
eAtlas of Global Development
The eAtlas of Global Development (http://www.app.collinsindicate.com/worldbankatlas-global/en-us), produced by the World Bank, is a sophisticated online interactive tool that maps and graphs more than 175 indicators from the World Bank’s development database. It allows users to easily and quickly transform data into customized visual comparisons across time, countries, and regions.
International Trade Statistics Yearbook
The International Trade Statistics Yearbook (http://comtrade.un.org/pb/) is a multivolume publication produced by the United Nations Statistics Division and the Department of Economic and Social Affairs that is featured on the International Merchandise Trade Statistics Web site. The yearbook provides information on the world trade of individual commodities in 2013 and features world-trade tables covering trade values and indices.
Bureau of Economic Analysis
A US Department of Commerce affiliate, the Bureau of Economic Analysis (BEA; http://www.bea.gov) promotes a better understanding of the US economy by providing timely, relevant, and accurate economic accounts data in an objective and cost-effective manner. The bureau’s goal is be the world’s most respected producer of economic accounts.
Binational Societies, Councils, and Trade Associations
There are also binational groups that will put you in touch with citizens of a country where you’d like to do business. You can search the Internet for the local branches. NAJAS (National Association of Japan-American Societies; http://www.us-japan.org/); the US-China Business Council (https://www.uschina.org/); and the US-India Business Council (http://www.usibc.com/), for example, all promote bilateral trade between the United States and the respective countries and also provide a stimulating social forum for people with common interests.
Check with your state to see if it has a foreign-relations or export council. Organizations like these usually assemble at least once a month, offering a forum for discussion about how to facilitate better international relations and expand trade.
Contacts made through business colleagues and associations can often also prove invaluable to exporters. Many states have associations that focus strictly on promoting world trade. Check with your local chamber of commerce to see which of these associations have chapters in your area and sit in on a meeting—and then sign up.
Additional Instant Resources
There are a number of additional online services that specialize in information about particular foreign markets, especially news about fast-breaking market opportunities in fast-changing parts of the world. When you use these services, don’t forget to keep your segmentation schedule and your market-issues list close at hand.
· In addition to the previously mentioned ease of doing business rankings, the Doing Business site (http://www.doingbusiness.org/), run by the World Bank Group and the International Finance Corporation (http://www.ifc.org), provides objective measures of business regulations for local firms in 185 economies and selected cities at the sub-national level.
· When all else fails, you can go back to the days of picking up the phone and call the US Department of Commerce Trade Information Center at 1-800-USA-TRAD[E] (1-800-872-8723).
Creating an Action Plan
Once you’ve spent some time getting a picture of the international market for your product, you’ll want to make a plan for how you’re going to put your new knowledge to work. It’s best to tailor your plan to your day-to-day operating style or that of your organization. If you are action oriented and like immediate and tangible results, then structure your export plan so that you’ll see regular results or responses. If you are more methodical and conservative in your business habits, then structure your export plan to produce degrees of progress over a longer period of time.
Setting goals that will allow you to operate comfortably will generate regular signs of progress. For example, let’s say you have no export business at present. Your goal might be to generate US$12,000 in international sales during one year. That’s US$1,000 a month, or US$250 a week. When you break this annual goal down into regular increments, it begins to look reachable. There is no point in setting overambitious goals.
Tip Are you already exporting? Where to? Expanding into new markets is the next logical step. If you’re currently exporting to Ireland, for example, then the United Kingdom might be a good complementary market to enter. Are you conducting business in Canada? Then try Mexico (due to NAFTA) since it’s close in proximity to the United States. It’s likely that similar conditions exist in other nearby markets too, indicating that your product or service could also be successful there.
Above all, your plan must be manageable for the person or persons who actually have to implement it. If you are beginning your export program as part of an existing company, it is particularly important to get and keep a top-to-bottom companywide commitment to the export project.
Once you determine the style in which you want to conduct your export activities, the sales goals you hope to attain, and how fast you want to achieve results, then draft your plan. Start with a short, specific statement that gives a comprehensive view of your program—you can break this down into more specific steps later. A simple plan might look like this:
· All Alone Becky New to Exporting, Inc.
“I am going to e-mail product offerings to all the customers on the lists I’ve compiled. At the same time, I am going to ramp up marketing efforts via all social networks. I hope to receive a dozen inquiries within two weeks and at least one order within a month. If my results are not achieved within this time frame, then I will contact the appropriate government agencies and begin plans to participate in a trade show.”
If your company has a larger budget and more staff resources, your statement might look more like this:
· ABC Conglomerate Exporting, Inc.
“We are going to allocate 10 percent of our company’s net profits to developing foreign markets. An export team will be appointed within three months. Informational and promotional brochures as well as pricing schedules suitable for exporting purposes will be developed during the following three months. Advertising and trade show activities will be implemented thereafter.”
As you can see, preparing market research doesn’t have to be elaborate. It just has to be broken down into a series of manageable courses of action to be carried out during an estimated period of time. As you implement your plan, monitor it closely and expect to adjust it along the way to meet your objectives. And remember: the most important element of the plan of all is to keep trying!
So far, you’ve begun to learn about international markets for your product, to tap into the enormous network of export assistance that’s available to you, and to plan how you’re going to put these resources to work. Now you’re ready to take more ambitious measures to get in touch with serious players looking to buy what you’ve got to sell. If you want to catch their interest, though, you must first make sure that the product you have selected for export meets the target market’s local conditions. The following chapter gives a rundown on all the details you need to consider as you prepare your product for export.
1. “Measuring Global Growth and Trade,” Craig Poole, Upside: The UPS Blog, last modified May 24, 2013, http://blog.ups.com/2013/05/24/measuring-global-growth-and-trade/?.
2. Walter Isaacson, Steve Jobs (New York: Simon & Schuster, 2011), 567.