Reference no: EM13132128

Setting a strategy

It is not uncommon for a successful domestic business owner to want to think about taking business globally. It is important to ensure that a solid trade strategy is put into place. Some things to consider when devising the strategy are if overall benefits of exporting will outweigh costs, what will be the additional demand on key resources and how will they be met and if current company goals are harmonious with exporting products. It is important to do research on exporting, research the country or countries you wish to enter into to provide a window into if there is a market opportunity in the first place for the product to be exported, and to know who your customer base is.Ensure that your business will comply with and be consistent with the rules and regulations of that country in which you want to do business. Finally, reach out to foreign trade commissions of the country or countries that you wish to break into with exporting and they will be able to provide help and guidance on important details in accomplishing this process with topics such as tariff codes, shipping and other paperwork necessary.

Once a trade strategy is in place, there is amazing purchasing power available globally - according to Vimeo.com approximately 67% of people outside of the United States have purchasing power and 96% of them currently live outside of the United States. Expanding business to outside of U.S. borders will increase business, profitability and create more jobs. "Each $165K in exports creates a new American job!"(vimeo.com/23653600) Not thinking about doing business globally through exporting is considered by some to be a missed opportunity for growth and expanding U.S. businesses.

People in other countries are very interested in products manufactured in the United States. Consumers look for value in purchasing products and if they are useful to them. Many consumers from foreign lands look for items that could be considered obsolete or prefer older products that may be no longer be viable options to sell in U.S. markets. However, some foreign markets are less developed and do not have any expendable cash which lowers their purchasing power, so it is important to have studied the country and its ability to purchase items before deciding to enter that marketplace. An existing U.S. company can work with people in foreign markets that have already broken into that potential marketplace to give insights as to what works and what doesn't.

In order to choose a country to export to, there should be an affinity or connection to it. Whether you speak the language or have family there, it is important to have a connection to the country and be comfortable with possibly doing business with that country. It is also important to have a keen understanding of the culture and who the market will be. The easiest means of contact today with foreign countries is through the Internet. Study, plan and explore businesses already established in that country and make inroads by reaching out to those that you find interesting or will be a means for opening up an avenue for a potential business market.

There are many ways to find customers in foreign lands. First, it is important to note that people from other countries are very interested in items from the United States. Sometimes, however, it is difficult to make connections with these people so they can have opportunities to purchase items. One great way to allow for people to be aware of what is available for purchase is through trade shows. Trade shows are a great way to connect with people from all over the world. According to the US National Export Initiative (NEI) of 2011, the "Departments of Agriculture, Commerce, and State operate programs to recruit potential foreign buyers to major trade shows in the United States." (p.25) Foreign buyers are matched with U.S. counterparts and this means that the U.S. company has an opportunity to expand business in a cost-effective way. Another place to look for customers is the Small Business Administration (SBA) and Business.comBoth have an online websites providing key and relevant information about understanding exporting and its regulations. Another way to find customers is to build upon existing markets by piggybacking off of existing partnerships that are already established in the offshore marketplace. In addition, visit the country and target conferences and governments to give insights into do's and don'ts of exporting.

The first country I would choose to export to is England. I have visited there a few years ago, and it reminded me so much of home, so one of the reasons is purely sentimental. My husband also has family there and there is no language barrier. They have purchasing power, have similar likes and dislikes to what people in the United States have and England's economy is highly industrialized with a well-developed trade infrastructure. Another plus is that England and the United States already have strong ties with both imports and exports. According to Economywatch.com, the "United States imports 8.7% of its products" making it a strong import partner, second behind Germany. The United States leads the pack in being an export partner for England, so it should be a relatively easy market to break into.

Another country that I would consider exporting to is Colombia. I think the country is very beautiful and it has such potential in the marketplace today. They are targeted as a strong contender for foreign markets to explore for exporting purposes because they have a strong growth rates and the potential for generous gains for U.S. exporters.Colombia shows potential for a marketplace with ample and diverse products and services. Economic expansion is on the horizon and this growth willstimulate growth and development in neighboring markets. Between the years 2009 and 2010, Colombia's market growth grew by 27%. (nes.2011.final)

Make sure you know who you are dealing with and doing business with. Don't start doing business with someone that you have had only a few conversations with or haven't met with very often. Make sure their credentials have been fully checked out and are reputable. Also, I would be concerned with weather-related conditions and if they would affect shipments (floods, oil shortages or damage to refineries due to hurricanes, earthquakes), infrastructural shortages, workers going on strike, which will halt production of products, products being tampered with or stolen. Facing another economic downturn or financial crisis overseas. Or, if a crisis arises, face-to-face conversations are best, but may not be feasible due to location issues that can cause for a delay in taking action or misinterpretation of what is needed to be done. They all trouble me for obvious reasons - they could possibly affect my business in a potentially detrimental way.

States what thoughts you found most useful regarding

How to choose a country to sell to

How to find customers

What countries would you choose to export to? Why?

What problems do you see, and why do they trouble you?