Internet Resources for Global Business

Today, I spoke to eight creative, energetic businesspeople about how to set their course for successful international expansion, and shared how Hanson Marketing puts Internet resources to good use to grow businesses globally. Hosted by Mr. Gustavo Guerrero, Director of The Small Business Development Center and the Center for International Trade Development, these and other events are a great way for area businesses to learn what it takes to Go Global.

I’ve learned that when you gather eight businesspeople in a room, you get 80 great new ideas. Resources and connections are swapped, and all go away smarter and more motivated. Check out this inspiring, random assortment of eight surefire business models, whose customers are, at this moment, waiting on foreign shores:

  • after-market batteries for Apple products – from factories in China to consumers in Mexico
  • books and videos by a published author and noted speaker, destined for Latin America
  • casual apparel inspired by Hispanic culture, for fast-growing populations of all ages in US and Latin America
  • skin care products bound for Asia, targeting style-conscious women in Taiwan
  • broadband, wireless and telco goods and services for growing South American system integrator and b-2-b markets
  • eco-friendly interior design and compatible products; the beginnings of a global decor bazaar
  • modular, solar power generator stations – from Utah to Baja
  • threat assessment, investigation, and security services – targeting HR, IT, travel professionals

You can learn more about today’s presentation and register for upcoming events at the SBDC & ITC at their website.  It was my pleasure!

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India Infrastructure: Weak Link Slows Expansion

According to reports in livemint.com, “Indian ports won’t be able to handle the world’s biggest cargo ships when they start sailing because facilities in this country aren’t capable of handling the vessels or the volume of containers they carry”.

Despite India’s world-leading population, none of its 20 ports appear on the list of the world’s largest. “Interior infrastructure such as connecting roads, railway lines and storage space at ports and at warehouses are also inadequate”.

Though the country’s population growth signals world-leading consumer demand, manufacturers and service providers should take note that India’s economic expansion will come at a much higher cost, and take longer. Of course, conditions apply to India’s export strategies, too.

Super ports such as Singapore, Dubai and even Colombo in Sri Lanka will stand to gain even more business, as trans-shipment points for India-bound goods and commodities.

Read more here.

The Americas Business Forum in Los Angeles

I attended the 3rd annual The Americas Business Forum at UCLA on March 2. The LA Chamber organizes this great event, along with the US Foreign Commercial Service and UCLA Anderson School of Management.

As a channel builder for manufacturer-exporters, I seek the fastest, most margin-friendly route to market for my clients. So, for me the most valuable part of the event was to talk with senior foreign commercial service diplomats who are in charge of building US export channels throughout the Americas: from Canada to Chile. In a round-robin of talks, they laid out challenges and opportunities that await US exporters in their respective countries.

As exporters, it’s easy to salivate over the young, growing population and the emerging consumer classes in countries the size of Brazil. The region’s economic growth rate outpaces that of the US right now, too. But, the experts urged listeners to go in with eyes wide open. In fact, the senior commercial officer from Brazil dropped one of the best one-liners of the day: “”Brazil is the country of the future and always will be”.

Collectively, attendees learn all facets of the countries: political trends, challenges in infrastructure, levels of bureaucracy, and which industry sectors are best prospects. Those senior officers stay for a second day of one-on-one counseling sessions, too.

High points:

  • – learning about the Colon Free Trade Zone in Panama, and its ideal role as a sales channel turnkey site. Engaging the services of an all-in-one representative company in Colon, I can launch my clients’ products in any or all countries in Latin America. Granted, margin discounts would reflect such turnkey services, but the efficiency with which a small or midsized US exporter could reach multiple markets probably can’t be beat. I’ve got three clients in mind right now, all makers of consumer goods, and will report back throughout the upcoming selection and retention process.
  • – hearing about Chile’s consistent, pro-business growth and its strategic ties with US partners in higher education, finance and agriculture, among others. Don’t forget that Chileans are recovering from that massive quake in 2010, just over a year ago. Part of the opportunity for US concerns lies within the re-construction efforts there, via government tenders.

UCLA’s student body is truly the Face of the Americas, and meeting on this elegant campus to talk about the future of regional trade only added to the inspiration of the event. Bookmark the event’s website, and plan to attend the 4th annual!

Put Trade Agreements to Work for Your Company

The International Trade Administration at the US Department of Commerce takes the lead on Market Access and Compliance (MAC), to assist exporters expand their share of the global export market.

MAC’s core mission is to aggressively support US business interests abroad, leveraging diplomatic, law enforcement and trade agreements with foreign trading partners. The ITA team, located throughout the US and at overseas offices, has a great track record of staying in lockstep with US companies involved in global trade. They think and act with a sense of urgency, which those of us who’ve worked in the startup sector can truly appreciate.

Trade barriers are legal (tariffs, embargos) and illegal (piracy and counterfeiting) The work done by the MAC division at ITA is shaped by real-world challenges faced by American exporters and workers.

What we commonly define as “Barriers” is open to debate, but nearly all of us might apply the term to any of these three scenarios:

procurements by foreign governments that favor particular suppliers

higher taxes in foreign markets than similar, locally produced products

difficulty protecting or enforcing IP in a particular country

The more complex, unique, or technical your company’s solutions, the more you need to know about MAC.

Check out yet another valuable federal resource, TCC On-Line (www.trade.gov/tcc). Need to report a trade barrier? Visit the site and click on Report A Barrier.

Successful Export of Agricultural Products in 2011

Hanson Marketing has made great use of several tried and true, publicly-run business development agency programs when establishing selling channels worldwide. Among them is the Foreign Agricultural Service at the US Department of Agriculture. In 2010, we took part in a novel program in Brazil, on behalf of our client who makes gourmet sea salt in Hawaii. The Sao Paulo office of USDA connected us, at no charge, with a pre-qualified short list of prospective wholesale channel partners. The process was soup-to-nuts: all we did was ship a set of samples and literature to their US address (how easy!) and they took it from there. Though sales have not yet materialized, must say it was a smoothly run operation, and a great example of how a public agency thinks and responds like a private company. Total cost to participate? Zero.

In 2011, the Foreign Agricultural Service (FAS) is leading the way for exporters of US-grown agriculture products to meet new channel partners and customers at a series of valuable selling events. Also, check out this national trade association of state agriculture commissions here.

Scan this one-pager listing key shows for 2011. Choose a market, then go!

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US Cement Industry: Thrown Under the Truck?

As our nation pushes toward an ambitious goal of doubling exports between 2010 and 2015, the potential for export growth for some well-established US industries seems dire. Adding on the complex layer of environmental regulations reduces the odds for growth even further. It’s a frustrating double standard we live by… as citizens and business people, we are all stewards of the environment. But, at what point do regulations designed for preserving the health of the planet and of our common welfare cause diminishing returns?

A recent take on the cement industry points out the effect that far-reaching environmental regulation has on the health of the cement industry, both domestic and export. One industry veteran, who owns an industrial filter supplies company with a strong balance of both domestic and foreign revenue, told me recently that “with these regulations, you are putting the death nail into the North American cement industry.”

Meanwhile, “…cement from less regulated, less enforced (read less costly) areas such as China can be easily transported via ocean vessels to the North American markets. This “leakage” would effectively kill off all cement manufacturing in North America.”

So how does an industry fight back? This supplier brings up an interesting concept: a sort of environmental tariff on imported cement that’s been produced under less-stringent standards and is being brought in to the US (burning fossil fuels while en route here, by the way), thereby causing more environmental damage when used in the US than those product lines made here, under our tough regulations.

He reasons that a cement tariff on imports from offshore producers with sub standard controls and compliance certifications would be the answer. “If that does not fly with the WTO as protectionist, then apply it to any producers and see how thoroughly and quickly US ones comply, when compared to overseas competitors.. truly a free market is in play then.”

Learn more about the cement industry at:
Portland Cement Association website

EPA regulations

South Korea-US Free Trade Agreement

Wall Street Journal reports that the US auto industry has gained a strong concession in the terms of this FTA. The revised pact allows the U.S. five years to phase out a 2.5% tariff it levies on South Korean-built cars, rather than cutting the tariff immediately, as provided for in the original agreement struck in 2007.

After inconclusive negotiations between US and South Korea during last month’s G-20 agenda, North Korea’s recent attack on South Korean territory may have propelled the negotiation teams back to the table. In January, expect some bi-partisan drama as Congress reconvenes, spoiling for a fight before ultimately passing the deal at the recommendation of Ford Motors and the US Chamber of Commerce.

Seoul would immediately cut its tariff on U.S. auto imports in half, to 4%. A 25% tariff levied by the U.S. on South Korean truck imports would remain in place for eight years, while the corresponding South Korean tariff on U.S. trucks, 10%, would be cut immediately.

Overall, U.S. businesses that stand to benefit from a South Korea free-trade agreement include financial services, agriculture and manufacturers of big-ticket capital goods.

Speaking of food, reactions from Montana lawmakers tell how the beef industry’s desired concessions by South Korea didn’t get as far as those of automakers. Meanwhile, as import food prices fall for Koreans once the FTA takes effect, US citrus growers appear to be first in line for agriculture export gains.

Think about the potential for frozen juice and dried fruit, let alone fresh produce and nuts. Western US growers will get to the market first, so expect agriculture trade associations in that region to mobilize with trade shows and matchmaking trips.

President Obama Writes on Exporting

Here’s an article submitted by President Obama, reprinted in its entirety.

The New York Times, November 5, 2010
Exporting Our Way to Stability
By BARACK OBAMA

AS the United States recovers from this recession, the biggest mistake we could make would be to rebuild our economy on the same pile of debt or the paper profits of financial speculation. We need to rebuild on a new, stronger foundation for economic growth. And part of that foundation involves doing what Americans have always done best: discovering, creating and building products that are sold all over the world.

We want to be known not just for what we consume, but for what we produce. And the more we export abroad, the more jobs we create in America. In fact, every $1 billion we export supports more than 5,000 jobs at home.

It is for this reason that I set a goal of doubling America’s exports in the next five years. To do that, we need to find new customers in new markets for American-made goods. And some of the fastest-growing markets in the world are in Asia, where I’m traveling this week.

It is hard to overstate the importance of Asia to our economic future. Asia is home to three of the world’s five largest economies, as well as a rapidly expanding middle class with rising incomes. My trip will therefore take me to four Asian democracies — India, Indonesia, South Korea and Japan — each of which is an important partner for the United States. I will also participate in two summit meetings — the Group of 20 industrialized nations and Asia-Pacific Economic Cooperation — that will focus on economic growth.

During my first visit to India, I will be joined by hundreds of American business leaders and their Indian counterparts to announce concrete progress toward our export goal — billions of dollars in contracts that will support tens of thousands of American jobs. We will also explore ways to reduce barriers to United States exports and increase access to the Indian market.

Indonesia is a member of the G-20. Next year, it will assume the chairmanship of the Association of Southeast Asian Nations — a group whose members make up a market of more than 600 million people that is increasingly integrating into a free trade area, and to which the United States exports $80 billion in goods and services each year. My administration has deepened our engagement with Asean, and for the first eight months of 2010, exports of American goods to Indonesia increased by 47 percent from the same period in 2009. This is momentum that we will build on as we pursue a new comprehensive partnership between the United States and Indonesia.

In South Korea, President Lee Myung-bak and I will work to complete a trade pact that could be worth tens of billions of dollars in increased exports and thousands of jobs for American workers. Other nations like Canada and members of the European Union are pursuing trade pacts with South Korea, and American businesses are losing opportunities to sell their products in this growing market. We used to be the top exporter to South Korea; now we are in fourth place and have seen our share of Korea’s imports drop in half over the last decade.

But any agreement must come with the right terms. That’s why we’ll be looking to resolve outstanding issues on behalf of American exporters — including American automakers and workers. If we can, we’ll be able to complete an agreement that supports jobs and prosperity in America.

South Korea is also the host of the G-20 economic forum, the organization that we have made the focal point for international economic cooperation. Last year, the nations of the G-20 worked together to halt the spread of the worst economic crisis since the 1930s. This year, our top priority is achieving strong, sustainable and balanced growth. This will require cooperation and responsibility from all nations — those with emerging economies and those with advanced economies; those running a deficit and those running a surplus.

Finally, at the Asia-Pacific Economic Cooperation meeting in Japan, I will continue seeking new markets in Asia for American exports. We want to expand our trade relationships in the region, including through the Trans-Pacific Partnership, to make sure that we’re not ceding markets, exports and the jobs they support to other nations. We will also lay the groundwork for hosting the 2011 APEC meeting in Hawaii, the first such gathering on American soil since 1993.

The great challenge of our time is to make sure that America is ready to compete for the jobs and industries of the future. It can be tempting, in times of economic difficulty, to turn inward, away from trade and commerce with other nations. But in our interconnected world, that is not a path to growth, and that is not a path to jobs. We cannot be shut out of these markets. Our government, together with American businesses and workers, must take steps to promote and sell our goods and services abroad — particularly in Asia. That’s how we’ll create jobs, prosperity and an economy that’s built on a stronger foundation.

Barack Obama is the president of the United States.

White House Releases National Export Initiative Report

The president’s Export Promotion Cabinet has released its report to President Obama.

In so doing, Commerce Secretary Locke commented, “As American consumers spend a little less and save a little more, it has never been more important to connect U.S. businesses to the 95 percent of the world’s consumers who live outside our borders. Helping American companies sell more abroad will create jobs and boost our economy. This report is a blueprint for doing just that.”

On the same day, the European Union announced that it has signed its free trade agreement with its first Asian FTA partner-nation, South Korea. There’s a “safeguard” clause inserted to protect the small car industry from “sudden surges of imports in sensitive sectors, including small cars.” This added by Italy on behalf of FIAT. This development adds momentum to conclude our nation’s promising negotiations with South Korea, soon.

The Export Promotion Cabinet includes the Secretaries of Commerce, State, Treasury, Agriculture and Labor and the heads of all the trade-related government agencies. Its report provides an overview of the progress of the NEI and lays out a plan for reaching the President’s goals of doubling U.S. exports in five years to support several million new jobs. For a concise, brief executive summary of the report, visit the Commerce Department’s International Trade Administration’s website.

Border Governors Conference: US-Mexico Relations

Santa Fe, New Mexico is site of the latest in a series of Border Governors Conferences, taking place right now. Hosted by Governors Schwarzenegger (CA) and Richardson (NM), the governors of US and Mexico border states – Arizona, Baja California, California, Chihuahua, Coahuila, Nuevo Leon, New Mexico, Sonora, Tamaulipas and Texas – are hashing out vital issues tied to Border Security, Economic Development and Energy.

Why is this referred to as an “interim” conference? Read more at Wikipedia and here. (Hint: the conference was originally to be hosted by the governor of Arizona.)

The only problem is that 3 of the 4 US state governors are no-shows… Govs. Brewer of AZ and Perry of TX, lodging a counter-protest; and Gov. Schwarzenegger, with schedule conflicts. So – the teeth were kind of pulled out of this event right there.

Why should we listen when these six Mexican and four US governors talk? Because their 10 Border States represent a joint economy that ranks third in the world. And, with 42 different ports of entry, the region also represents one of the most dynamic trade and border crossing regions in the world.

Gov. Schwarzenegger is the state’s A-List deal maker; his recent trip to China resulted in preliminary agreements with Chinese suppliers for a high-speed, north-south rail link for the Golden State. (just as in the 19th century, China again contributes to Western US rail expansion… this time through infrastructure technology!) And, Gov. Richardson just secured a grant from the Economic Development Administration (EDA) targeting expansion of cross-border commercial rail service between New Mexico and Nuevo Leon (and he was Pres. Obama’s early nominee for Secretary of Commerce). Read previous Nitty Gritty Marketing posts on EDA here and here.

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