Getting Paid for Latin American Sales: What US Exporters Should Know

A large and abundant market awaits US exporters in Latin America. Although the combined GDP of Brazil and Mexico alone stands at over $1.5 trillion, US companies approach the region with skepticism. Real and perceived risk in financing and payment issues is a common reason for placing Latin American markets in third-place when expanding globally, usually behind European Union and Asian economies.

Often, lower-than-desired profit margins from sales in the region are a sort of self-fulfilling prophecy: in seeking to avoid slow re-payment or default risk, US exporters attach upfront payment terms that make them less competitive against foreign competitors who, by the way, might collect higher prices just by extending conventional, 30- or 60-day terms on account.

US exporters need look no further than a great resource published by a private-public collaboration. Just a click away at BUYUSA.GOV, the US Commercial Service offers a comprehensive guide, produced in cooperation with PNC Bank and Fedex. This trilingual guide identifies several financing and payment mechanisms available to support US exporters selling to Latin America. The first page alone features an excellent reference chart that should be put to daily use by sales, operations, and accounting teams.

Being better informed about resources at hand, and staying abreast of what competitors might also have at their disposal, will remove initial fear, uncertainty, and doubt for US exporters about getting paid and preserving profit margins.

National Association of Associations

Greetings from our nation’s capital, home to over 2,000 of our nation’s 7,600 trade associations. No surprise, as one of the main functions of a trade association is to influence public policy. Add to that hefty number all our regional and state sub-associations, and the legions of lobbyists and industrial relations consultants and… well, you get the picture of a vast and very lucrative Beltway Business Model.

I always advocate active membership in trade associations for my clients. It’s the fastest way to align with influential partners, become a thought leader, and expand globally. While always worth the dues, they can be a time trap for small and midsized businesses. A smart CEO of a growing company will insulate his team from association committee work and regional meetings, which tend to become glad-handing boondoggles. They’re the perfect chance for big fish in small ponds to show off! Instead, the CEO should encourage his team to pursue continuing education and certification programs they offer, and his marketing and sales teams should be leading sponsors at trade shows and in co-marketing campaigns.

This morning, I walked past the National Rural Letter Carriers Association head office, in a very new, un-rural office complex, and I wondered just how many NRLCA members there are. Could they all perhaps fit in the lobby? Next door is a two-building, multi-story complex of offices for the Society of Human Resources Management. Really glad to know that the Soap and Detergent Association is also nearby… doing its best to keep national politics squeaky clean!

I think I’ll start up a National Association of Associations… though it appears that the American Society of Associations beat me to it.

US-Korea Free Trade Agreement: Boon to California

California exporters, their employees, and supporting businesses will benefit from a Free Trade Agreement between the US and South Korea in 3 ways:

1) Intellectual Property Protection: Software, music, film, videos and publications that originate in California will be better protected than ever before from piracy, through more stringent regulations once this FTA is passed

2) Agricultural Duties: Growers and makers of pistachios, almonds, wine, frozen orange juice, and raisins will gain competitive price advantage, once duties are eliminated upon passage of this FTA. Note, however, that rice is completely excluded from the agreement, foreclosing any new markets for U.S. rice producers

3) Reduced Time-to-Market: Streamlined customs procedures will reduce red tape and accelerate time to customers, once this US-Korea FTA is approved. With exports to Korea from California already standing at about $8 billion and growing, it’s clear that the state’s trade with that region will only grow.

Where do things stand as of today with its passage? According to a recent Reuters news item, U.S. Trade Representative Ron Kirk assures readers that “It is our goal to bring them [pending FTAs with Korea, Colombia and Panama] to Congress as soon as we can. I cannot put a time line on that, but they’re important to us”.

Cali Baja Shines at Mexport

Mexport is an annual trade show in San Diego — a great, one-day snapshot of Cali Baja’s economy, a term that describes the greater economic zone between Baja California in Mexico and San Diego and Imperial Counties in California. Services in global transportation, manufacturing and assembly reflect the impetus of the local economy and the interlaced nature of Cali Baja.

My colleagues at the Imperial Valley Economic Development Council say they continue to greet 3 to 4 trade delegations from Asia and the Middle East who come seeking resources in agriculture – Imperial County exports grain to both regions – and in emerging alternative energy such as biomass algae and wind. (In April, when I was in El Centro at the annual regional global trade summit, I heard firsthand about damages from the Easter Sunday earthquake and aftershocks in Mexicali and Calexico, which are much worse than we’d feared: flooding from busted irrigation lines has interrupted growth and harvesting cycles, and many private and public structures remain uninhabitable.)

Here’s a group of services providers that you probably would not meet if you were to attend a similar event along the Washington-British Columbia or Michigan-Ontario borders: specialists in retro-fitting vehicles with armor and bullet-proof glass, and evasive driving instruction. Three fast-growing companies, owned and operated by guys who you’d want on your side in a rumble, displayed car doors riddled with bullet holes and heavy-duty vehicles tricked out in under-armor and very thick, tinted glass. Business is booming along the volatile US-Mexico border and in the Middle East, as companies go to great lengths to insure and protect Key Men and families.

One of Mexport’s sponsors, Corrugados/Orange County Container, is a bi-national provider of packaging goods and services to Cali Baja’s manufacturers. Their booth was done up in World Cup Fever theme, replete with easy chairs and footrests built from corrugate and designed in the shape of soccer balls. Between these chairs and the bullet-riddled door panels, I knew I was at a show that meant business!

Announcing Enhanced Hanson Marketing Website

The latest version of includes case studies for successful export strategies, an expanded capabilities list, and new testimonials from satisfied clients and colleagues.

May is World Trade Month, and our nation’s momentum for export growth is strong, so now’s the time to set up an export strategy with Hanson Marketing!

May is World Trade Month

World Trade Month: What's in Your Container?

As a big advocate of global trade, here’s my pitch for readers everywhere to get involved in World Trade Month.

Scan the U.S. Chamber of Commerce’s excellent website for a calendar of nationwide events on building global trade, and get going! Boise … Cedar Rapids … Miami … The Big Apple … Northern Kentucky or Southern California … Detroit. Trade is on the minds of everyone these days, from the Oval Office on down. Our nation’s secretary of commerce is leading a cabinet-level trade mission to Asia later this month, too.

Traditional and new industries nationwide are experiencing tremendous growth in global demand for their products and services. And, makers of goods for consumer and industrial use from around the world are knocking on your door, to build up profitable new relationships with you. Go global!

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