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This is our very own in-house web guide for beginning exporters. It contains a great deal of useful information, and hopefully it will help you get well on your way to being an exporter.
Before you begin researching your markets, take the time to do an in-house reality check. Ask yourself the following questions:
1. Does your firm want to export?
2. Does your firm have sufficient capacity to expand sales on a permanent basis?
- Many firms turn to exporting to deal with excess capacity during slack economic times in the domestic market. However, you can’t just throw away a foreign market once the domestic market picks back up. If you enter the international market, you should be prepared to export in both good times and bad.
3. Is management committed to exporting?
- Top management must be committed to exporting, since it is a task not to be taken lightly. Management must be prepared to stick it out during the first few months or even years of exporting, when the bottom line won’t always look rosy. If management can look beyond short term problems to long term success, things will be well with the company that goes overseas.
4. Can you get management’s support to respond to an order, should one be forthcoming?
5. Will your firm want to establish a long-term sales relationship with an overseas buyer?
- If not, is the initial effort worthwhile? Can the new sales generate a growing appreciation of exports, and the profits associated with those sales?
- If yes, to which country or countries will you target your marketing efforts?
A company needs to first identify its best markets through
market research. Your research should tell you:
1. Where is the largest market for your product?
2. Where is the fastest growing market for your product?
3. What is the market trend and outlook for your product?
4. What are the market conditions and practices?
5. Who are your competitors and what are their products?
A systematic method of market research should involve
a preliminary screening of potential markets followed by a careful assessment
of the targeted markets. Based on the information gathered, a firm must
decide which markets are the most promising and the number of markets the
firm is prepared to enter.
For an outline on researching international markets, you
can refer to the U.S. Department of Commerce publication entitled “A Basic
Guide to Exporting.” This publication reviews the steps involved
in screening and assessing international markets. If you prefer to look
at a version of this publication available on the internet, you can look
it up at the site, http://www.unzco.com/basicguide/index.html
Subsection A: Sources of Market Research
Perhaps the best place to start your market research is
your state or federal government assistance offices.
On the federal level, the following
offices are available:
U.S. Department
of Commerce
11133 “O” Street
Omaha, Nebraska 68137
Phone: (402) 597-0193; Fax: (402) 597-0194
U.S. Department of Agriculture
Foreign Agricultural Service
Washington, DC 20250-1000
Phone: (202) 720-3935; Fax: (202) 690-2159
U.S. Department of State
Washington, DC 20250
Trade Information Center
U.S. Department of Commerce
Rm. 7424
Washington D.C. 20230
Phone 1-800-872-8723 Fax (202)
482-4473
On the state level, the Nebraska Department
of Economic Development and Nebraska Department of Agriculture have reviewed
our international trade development activities and expertise, and have
developed a working relationship to provide a variety of assistance programs
to Nebraska business across the state.
Nebraska Department
of Economic Development
P.O. Box 94666
301 Centennial Mall South
Lincoln, NE 68509-4666
Phone (402) 471-3111 Fax (402) 471-3778
Nebraska Department
of Agriculture
P.O. Box 94947
301 Centennial Mall South
Lincoln, NE 68509-4947
Phone (402) 471-4876 Fax (402) 471-2757
What International Trade Development Activities Do They
Do?
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Governor’s Trade Missions:
Each year, the Governor leads a trade and investment mission abroad. The
location of the mission is determined by interest expressed by the international
trade community, input from previous trade mission participants, and international
trade staff from the Departments of Economic Development and Agriculture.
The purpose of the trip is to assess market potential, identify potential
business partners, reinforce existing business relationships and establish
new business relationships.
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Calendar of Events: The Departments
of Economic Development and Agriculture share a calendar of events in order
to better coordinate our activities with regard to providing services to
Nebraska businesses. This calendar includes domestic and international
trade events relative to international trade development. There is a partial
listing of events on the internet at http://www.neded.org/component/option,com_extcalendar/Itemid,62/
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Trade Missions: There are
international trade events occurring every day in some part of the world.
On occasion, we are able to provide staff and support for Nebraska firms
to collectively attend and participate in international trade missions.
If firms cannot participate, we try to get the information out to appropriate
Nebraska firms for them to review.
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Trade Shows: International
trade shows provide an opportunity for Nebraska firms to assess market
potential, identify competitors, and establish potential business relationships
in other countries. On occasion we are able to provide staff and support
for Nebraska firms to collectively attend and participate by sharing booth
space or other expenses.
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Staff Trips: Staff from the
Department of Economic Development and the Department of Agriculture travel
abroad annually making contacts and collecting information in an ongoing
effort to promote the sale of Nebraska products abroad. Individual company
needs are often identified, and special attention is given to collecting
specific information for those firms.
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Host Foreign Visitors:
International visitors come to Nebraska every day of the year. These visits
can often be directed to specific firms in the State as a result of the
involvement of the Departments of Economic Development and Agriculture.
Although some visitors are primarily interested in government agencies,
these visitors also provide our staff with important local contacts once
they have returned home.
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Workshops / Seminars: Both
departments sponsor or co-sponsor several workshops annually on export
documentation, market entry methods, methods of payment, country-specific
workshops, and other topics based on demand from Nebraska businesses. These
courses are designed to provide hands-on practice and concrete examples
that will better enable Nebraska firms to prepare for export.
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Publications: Both departments
provide a variety of publications that are made available to Nebraska businesses
as well as potential overseas customers. Some of the publications include
international trade directories, an international commerce guide, and general
assistance brochures. Some of these publications are also available on
the internet.
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Trade Lead Program: The Department
of Agriculture provides international trade leads; some are provided in
hard copy form, others are available through electronic bulletin boards
or the Internet. The Department of Agriculture’s website is http://www.agr.state.ne.us
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Newsletter: By simply calling
the Department of Economic Development or the Department of Agriculture,
you can be added to the mailing list to receive a copy of the newsletter
provided by one or both departments. These newsletters keep businesses
informed of department activities and often contain a calendar of international
trade events as well.
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Market Research: Limited market
research is available from the Departments of Economic Development and
Agriculture to assist in directing a company’s marketing efforts towards
two or three markets rather than taking a “shotgun” approach to marketing.
Our resources include the majority of the resources in this guide, as well
as others that we have established through our own international activities.
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Counseling / Technical Assistance:
International staff members are available to visit on-site with companies
interested in pursuing international markets. We need to learn as much
about the company, its products, and its management as possible in order
to determined the export potential of the company and how to proceed. Assistance
may be in the form of a response to an individual question, or it may take
on a more long-term strategy. Our departments provide information on market
research, export restrictions, documentation, quotas, duty rates, financing,
and other special requirements for export to specific countries.
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Referrals: Although a majority
of the questions asked by Nebraska businesses can be answered or found
in-house, there are some that are referred to exports in the field (i.e.
bankers, freight forwarders, testing laboratories, etc.) If we don’t
know the answer, most likely we will know where to find it, or who to contact
to find out the information.
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Networking with other Agencies:
Making the best use of our resources and the experience and expertise in
Nebraska is extremely important. Therefore, we network as much as possible
in order to eliminate duplication of efforts and provide the best information
and assistance available to us. This network includes the US Department
of Commerce, US Small Business Administration, US Customs, Department of
Economic Development, Department of Agriculture, Midwest International
Trade Association, Nebraska District Export Council, international
bankers, transportation companies, freight forwarders, attorneys, accountants,
and experienced exporters across the state.
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Proactive Identification of Companies:
The Departments of Economic Development and Agriculture both contact Nebraska
firms that exhibit international trade capabilities and encourage them
to consider international trade opportunities. They also assist in identifying
potential business partners abroad.
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Match Marketing: Part
of our program includes matching Nebraska exporters with potential overseas
buyers in an effort to sell more Nebraska goods abroad. Our ability to
do so depends on the information available from the Nebraska firm, as well
as contacts we have made domestically and internationally.
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International Business Recruitment:
In addition to international trade development, the Department of Economic
Development also focuses on recruiting direct investment from abroad. This
direct investment may come in the form of a new company in the state, or
investment in an existing business in the state.
In addition to governmental agencies,
there are also other sources of international marketing information:
Commercial Banks:
Two banks currently have international banking officers
in-house. These banks are located in Lincoln and Omaha, but they often
maintain correspondent relationships with smaller banks throughout the
state as well.
First National Bank
of Omaha
Call Paul Warfield in Lincoln at 402-323-5259
U.S. Bank
Call Candy Pedersen in Omaha at 402-348-6283
Industry Trade Associations
Industry trade associations are useful both for the special
services they offer members and for the opportunity they provide to meet
companies with previous export experience. In addition, some industry trade
associations may be affiliated with trade associations in the target markets
you may be trying to penetrate.
Associations Unlimited (formerly The Encyclopedia of Associations)
is published by Gale Research, 835 Penobscott Building, Detroit, Michigan
48226. (1-800-877-4253) and http://www.gale.com.
This publication lists almost every U.S. trade association known. This information
is available on CD’s and on-line. Most libraries will have the database,
and may give you names of appropriate associations by telephone.
Directory of North American International Trade Associations
is published by the Federation of International Trade Associations, 1851
Alexander Bell Drive #400, Reston, VA 20191. (1-703-620-1588). The publication
is a good resource for associations on the North American continent.
International Freight Forwarders
Today the movement of goods from one country to another
is often facilitated by the international freight forwarder and the customhouse
broker. The former can give expert advice regarding the transportation
of goods from seller to buyer, while the latter is a U.S. Treasury Department
licensed professional with the regulations concerning importation of goods.
Both are excellent sources of technical information concerning transportation,
documentation, and customs regulation, both domestically and abroad.
Here is a partial listing of Freight Forwarders in Nebraska:
Agency for International Development (A.I.D.)
A.I.D. is the vehicle through which most U.S. bilateral
foreign assistance programs channel their funds. The assistance is usually
in the form of grants or concessionary loans. The main point of interest
to Nebraska exporters is that A.I.D. is required by law to procure both
the products and services necessary for the projects from U.S. sources.
After the specific needs are determined for these overseas projects, U.S.
suppliers are solicited through direct mail and leads published in the
Commerce Business Daily, or notices are sent directly to firms that have
preregistered with the Agency Only if a U.S. supplier cannot be found can
the contract be awarded to a foreign supplier.
If your firm is interested in supplying goods or services
to specific countries only, A.I.D. can provide country-specific information.
Ask for the appropriate country desk officer or industry desk officer for
additional information.
Contact A.I.D at
U.S. Agency for International Development Information
Center
Ronald Reagan Building
Washington, DC 20523-0016
Telephone: 202-712-4810
FAX: 202-216-3524
or visit their website at http://www.info.usaid.gov
Commerce Business Daily
The Commerce Business Daily publishes notices of international
vendors looking to import and export products from their area. You can
respond directly to these leads or use them as a means of identifying a
potential market for your product by monitoring the leads and observing
from where the majority of leads for your product are coming. You can access
the Commerce Business Daily on-line at http://cbdnet.access.gpo.gov/
Trade Publications
These industry specific publications often focus on international
marketing trends and market conditions for that industry. International
contacts or affiliated industry associations may be cited.
International Trade-Related Newsletters
Numerous publications exist that cover general market
developments in specific geographic areas. These newsletters are helpful
in keeping a busy executive apprised of current developments or impending
projects overseas. They can be expensive, and the news coverage can range
from speculative to stale. Nonetheless, many of these privately published
reports are well worth the subscription.
Foreign Government Trade Publications
Many countries maintain extensive export promotion efforts
that also publish trade-related publications. These are generally free,
but they reflect the natural export bias of that foreign government. The
Japan External Trade Organization (JETRO) has perhaps the broadest selection
of publications. JETRO’s efforts have been better balanced than other country’s
efforts because the Japanese trade imbalance with the U.S. has caused them
to encourage exports to Japan.
International Business Magazines
For exporters in international business, there are certain
international business magazines that offer broad overviews of the international
trade arena. In many countries, politics ultimately dictates how commerce
moves and it is important for exporters to beware of the volatile political
winds that affect local markets.
The Economist is a London-based magazine that has
excellent world business coverage.
You can subscribe on the web at http://www.economist.com
or write to them at
The Economist Subscription Services
PO Box 58524
Boulder, CO 80322-8524
The Far East Economic Review is essential for keeping
abreast of political and commercial developments in the Far East. You can
subscribe on the web at http://www.feer.com
or write them at
Far Eastern Economic Review
Citicorp Centre 25th Floor
18 Whitfield Road
Causeway Bay, Hong Kong
Foreign Telephone Directories
Many larger public libraries carry a number of foreign
telephone directories that may be very useful in researching foreign markets.
These may actually be on microfilm or microfiche copies. There may also
be some directories available on the internet.
Trade Directories
Trade directories can be purchased from many export promotion
offices of foreign nations, where additional contact information may be
found.
Foreign Consulates and Embassies
Foreign consulates and embassies can be invaluable sources
of information for the exporter. Typically, they do not keep tariff information
on hand that will allow you to predetermine the import taxes on your product.
This information may be available through the U.S. Department of Commerce.
The commercial sections of most foreign embassies have directories of firms
located in their country. Some, but not all, may be willing to share this
information with you. A good locating guide for embassies and consulates
on the internet can be found at http://www.embassy.org/embassies/index.html
Japan also operates a special trade promotion office called
JETRO (Japan External Trade Organization) in Denver, Colorado that services
firms in Wyoming, Colorado and Nebraska. You can contact them at:
Japan External Trade Organization
1200 Seventeenth Street, Suite 1110
Denver, Colorado 80202
Phone: (303) 629-0400
Fax: (303) 893-9522
or on the internet at: http://www.jetrodenver.org/default.htm
U.S. / Foreign Chambers of Commerce
US / Foreign chambers of commerce have become trade promoters
for their respective countries or regions. In some cases, these chambers
handle certification of documents and trade inquiries, develop special
trade programs for their members, and host foreign delegations. They often
work in close cooperation with their counterparts to increase trade opportunities.
The chamber is a good avenue through which to collect a list of prospective
buyers, because the chambers will promote trade, regardless of whether
its an import or export transaction.
Traveling Executives
Business people who travel abroad often are potential
sources of trade lead information for products and services which they
themselves cannot supply. They’ve developed contacts, have experience dealing
internationally and are usually willing to share their expertise with non-competitors.
Private Sector Sources
Law firms, accounting firms, shipping companies, air carriers,
management companies, and other private sector service organizations often
have their own networks with regard to international trade opportunities.
For-profit organizations may want to retain control over the leads they
provide in order to do their own brokering.
International Organizations
Many of the following organizations maintain market information
that can be used by exporters. Many of the international development banks
operate project bidding systems.
World Bank
1818 H Street, N.W.
Washington, DC 20433 U.S.A.
Tel: (202) 477-1234
Inter-American Development
Bank
1300 New York Avenue, NW
Washington, DC 20577
Tel: (202) 623-1000
Organization for Economic
Cooperation & Development
2001 L Street, N.W., Suite 650
Washington, DC 20036-4922
Tel: (202) 785-6323 Fax: (202) 785-0350
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African Development Bank
Rue Joseph Anoma
01 BP 1387, Abidjan 01
Côte d'Ivoire (West Africa)
Tel: (225) 20-44-44 Fax: (225) 21-77-53
European Union
Council of the European
Union
Mr Antonio Buccarella
General Secretariat of the Council of the European Union
Rue de la Loi 175
B-1048 Bruxelles, Belgium
Tel: (322) 285 6589 Fax : (322) 285 8375
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Asian Development Bank
P.O. Box 789
0980 Manila, Philippines
Tel: (632) 632-4444 Fax: (632) 636-2444
Permanent Representative of
the United States to the United Nations
799 United Nations Plaza
New York, N.Y. 10017-3505
Tel: (212) 415-4000 Fax: (212) 415-4443
International Monetary Fund
700 19th Street, N.W.
Washington, DC 20431
Tel: (202) 623-7000 Fax: (202) 623-4661
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The research phase of the export process culminates with the final selection of the market(s) to pursue. How does the export manager weigh all the diverse characteristics to select the most promising market(s)?
Answer: Analyze the data you have collected. There are many characteristics that should be considered when making the final decision. The following checklist details some important factors.
- Import regulations and import quotas
- Duty rates
- Labeling requirements
- Documentation requirements
- Insurance requirements
- Political relations and trade agreements with the U.S.
- Economic conditions
- Availability of financing
- Government regulations requiring local content, joint venturing, or licensing
- Availability and cost of transportation
- Actual market size
- Potential market size
- Market characteristics such as language, climate, living standards, customs, and cultural differences
- Economic factors such as natural resources, industrial development, income levels and trends of economic
- development
- Local business procedures
The company may conclude that its marketing resources would be best used if applied to only a few countries. In general, company efforts should be directed to fewer than six markets if the firm is new to exporting. One or two countries may be enough to start. The company’s internal resources should also help determine its level of effort.
The “go or no-go” decision is dependent on whether your product is competitive and income producing after the profit margin has been discounted to reflect the preconditions, costs, and potential that is inherent in the target market. Ultimately, it’s your good business sense that’s crucial.
Market research is an extremely important first step, but it’s obviously just one step in a series of steps that prepare you to export your product(s). Once you have a country focus you can begin:
1. Reviewing market entry methods and pricing strategies for that area
2. Identify documentation requirements and transportation logistics
3. Consider the legal aspects of doing business internationally
4. Determine the best method of payment for that transaction
5. Familiarize yourself with the cultural aspects of doing business in that area
These topics will be discussed in training sessions sponsored by local trade promotion groups throughout the year. Visit the calendar of events for dates and topics. Be sure to stay with the process and do it right. As the old saying goes, “If you don’t have time to do it right the first time, how are you ever going to find time to do it again?”
Stay with it, and do it right!
By the end of your research, you should be ready to export. Market the product, sell it, ship it, get paid for it, and then enjoy the sales. But be sure to follow up....
After you’ve made your sale, review and revise the steps for the next transaction. Go back to your resources for additional assistance when necessary. Tailor the process to your needs and those of your customer.
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International 
