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27 Replies Latest reply: Mar 24, 2009 3:02 PM by ldelaney RSS

Event:  Going global with your small business

SBC Team Master
Currently Being Moderated
Thinking of taking your business global? Then you've come to the right place.

Laurel Delaney runs GlobeTrade, a leading management consulting and marketing solutions company dedicated to helping entrepreneurs and small businesses go global. Her company's mission is simple: to make going global easy by giving you the tools, resources, and knowledge you need.

And she feels very strongly that in today's fiercely competitive economy, it's the entrepreneurs and small business owners of the world who are turning to global trade, discovering accelerated growth and big profits, and reshaping the new world economy.

Ask Laurel questions like:

  • What is the single biggest stumbling block to taking a business global?
  • How to I find the right international partners?
  • Why should I go global?
  • How do I evaluate the benefits and risks with expanding my business abroad?
  • What advice would you offer to those of us considering expanding our business internationally?

Laurel hopes that her session empowers you to take that first dramatic step toward starting your own business and taking it global from the get-go.

Post your question for Laurel here and then check back on March 24 at 2:00PM EST for her reply. You can post a question any time during the event hour.

If you'd like to post a question, it's easy - simply hit reply. However you must be logged into your user account to do so. If you aren't a member yet, signing up is easy and free. It just takes two minutes. Click here to join now if you haven't already http://smallbusinessonlinecommunity.bankofamerica.com/create-account.jspa.
  • Re: Going global with your small business
    antiques4me Newbie
    Currently Being Moderated
    Can you talk about tips related to container shipping? Also, sometimes I do not have enough merchandise to fill one container, how can I find a partner to share costs?
    • Re: Going global with your small business
      ldelaney Newbie
      Currently Being Moderated
      Sure, your best bet is to hire a global freight forwarder (or even UPS can assist on matters such as this) which serve as all-round transport agents for moving cargo, typically from a factory door to your customer’s warehouse. Their service saves you a lot of time, effort, and anxiety for a very reasonable fee (generally U.S. $150-175 per shipment) – an expense you’ll include in your price quotation to your customer and recoup when you collect payment.

      Freight forwarders can be found by conducting a Google search with the key words “freight forwarder, Chicago,” for example, that is, if you are searching for one located in that city. Or try “transportation expert, freight forwarder” that might do the trick as well.

      A good freight forwarder helps you make the sale and deliver the goods in a safe, timely and cost-effective manner.

      If you have enough goods to fill a straight container (usually average 20 to 48 cubic feet), it’s an advantage. Your product will be loaded into the container all by itself, rather than being consolidated with other companies’ products to fill the container, and a seal will be put on the door. This means that nobody else will have access to those goods when they arrive at the port of destination, except your customer or their designated agent. This safety measure guards against potential theft, pilferage, and product tampering.

      If you do not have enough goods to fill one container, as in your case, than you want to ship breakbulk (a freight forwarder can assist in this area too). Better known as less-than-containerload, or LTL, shipment, a breakbulk shipment is the most likely option to be used by new exporters, since your first orders are typically small. This is because your customer wants to test your product in his or her market before committing to a large quantity, such as a full containerload or more.

      To control the expense of a small-quantity shipment, find a transport company who specializes in breakbulk. Naturally, when you are shipping a small trial order and hoping for repeat business, it will be to your advantage to control your customer's costs by getting the best rate possible. Also, when shipping LTL, you'll need to take extra care in packing and marking your cartons. Breakbulk shipments are commonly packed using pallets, slipsheets or crates.
  • Re: Event Mar. 24:  Going global with your small business
    Bluesuit Apprentice
    Currently Being Moderated

    How do you go about establishing a relationship with an international merchant? I was traveling and came across some innovative products that would do well in the U.S. Also, what legal or tax related issues are there with shipping goods from oversees to the U.S.?
    • Re: Event Mar. 24:  Going global with your small business
      ldelaney Newbie
      Currently Being Moderated
      The first step is to track the merchant (you didn’t say what country you were traveling in) and contact them directly. I am assuming you purchased a couple of the products that you found innovative and the labeling is still intact to determine who distributes or manufactures the product.

      Do a search online to match up your findings to the label and then attempt to communicate directly with the company to find out whether they are interested in working with you as an importer on the product line to the United States (consider exclusive distributor or non-exclusive – whatever is most advantageous to both parties). Find out if they have experience selling their products worldwide. If not, that could be a red flag (due to communication barriers, legal issues, quotas, etc.). Find out why they are not selling overseas. You’ve got nothing to lose.

      As a second step, you might contact the U.S. Embassy (www.usembassy.gov/#) of the country where you wish to import from to learn if there are has been any bad press on the company you are about to business with or any hidden restrictions (word gets around fast … but you must ask the right questions to find out things) to doing business with them, period. You want to get a sense of their reputation in the marketplace in a most neutral, objective manner. In addition, U.S. Embassy will assist you with legal or tax-related issues relating to your product line (since you didn’t say what it is … food, computer software, jewelry or clothing, for example). It’s better to learn well in advance any potential barriers to import on a product BEFORE you place an order, pay for it and find out later during the transit process that the product is prohibited for entry into the United States.

      You might also double-check with a few global e-commerce sites to see if the company is listed or if there are other companies who produce a similar product but cheaper and with better quality. Among places to review are:

      Alibaba (www.alibaba.com)
      Global Sources (www.globalsources.com)
      Tradekey (www.tradekey.com)

      As a third step, contact your own international lawyer and accountant (I am counting on you to have these experts already in place) to find out about key considerations for importing the product line, like trademark and patent issues, methods of importing to ensure tax savings, exclusivity contracts, etc.

      Lastly, the best sign of a green light to import successfully is to find out the manufacturer does business all over the world but not yet in your country or city! This indicates they have the international experience and can help you get started quickly and efficiently. Ask for references to their other exclusive importers around the world so you can get a feel of what it’s like to work with the company. You are seeking a long history of positive experience and impressive sales results. Good luck!
  • Re: Event Mar. 24:  Going global with your small business
    Tori Novice
    Currently Being Moderated

    When do you know if it's right for your business to expand into other countries? What advantages are there?
    • Re: Event Mar. 24:  Going global with your small business
      ldelaney Newbie
      Currently Being Moderated

      When you are sitting around twiddling your fingers wondering where to sell to next! I am actually pretty serious about this. That's the first sign. The next is underutilization of capacity at your manufacturing facility (or, in the case of a service, underutilization of intellectual capital = people). Say you are only at 60 percent plant capacity. You need to ramp up to fully utilize your people/equipment and going global is a great way to do it. The advantages are numerous. Here's my shortlist:

      1. Increases sales and profits (especially if fixed costs are tied to domestic operations) = bigger chunk of growth gain.
      2. Earns a greater return from a set of core competencies.
      3. Generates economies of scale in production.
      4. Enhances local competitiveness and opens up the way to larger, more lucrative customers.
      5. Create jobs, productivity growth, and wealth.
      6. Enlarges the pie of potential investors.
      7. Insulates seasonal domestic (local) sales by finding new foreign markets and selling excess production capacity.
      8. Cuts costs through global outsourcing.
      9. Reduces dependence on existing markets.
      10. Capitalizes on tax advantages.

      Another sign is that you've been so successful locally or domestically that you've saturated the market with your product or service offering. It's time to look elsewhere for opportunities and overseas in a logical next step.
  • Re: Event Mar. 24:  Going global with your small business
    hammadi Newbie
    Currently Being Moderated
    I, would like to stare a small business?what,s your advace
  • How does globalization impact neighborhood businesses?
    MiGrant Newbie
    Currently Being Moderated
    Do small neighborhood businesses like restaurants, barbershops, local retailers, etc. need to be aware of globalization? How does international trade affect those kinds of businesses, and how can an awareness of global issues make them more successful?
    • Re: How does globalization impact neighborhood businesses?
      justobitome1 Newbie
      Currently Being Moderated
      What are the tax benefits of going global?
    • Re: How does globalization impact neighborhood businesses?
      ldelaney Newbie
      Currently Being Moderated

      Absolutely. Because you don’t know how a little shop in Morocco, for example, may be doing something so magnificently that they decide to franchise the concept and the next thing you know, Morocco Makeover Barbershop is next door to you offering the Moroccan experience in your local community. Or, maybe it’s a new green restaurant that air-ships unique ingredients in from exotic parts of the world to prepare the healthiest, freshest (“good for you; good for planet”) meals while setting them apart from local competition! If you can imagine it, it’s been done -- or will be done -- on a global basis and could impact your business.

      Due to technology and trade capabilities, we are so interconnected that if the United States sneezes, the rest of the world gets sick. We have to be totally cognizant of the fact that globalization impacts everybody – whether you like it or not. Why just look at us right now!

      But will community-based stores ever go away? I doubt it but I do predict there will be paradigm shift from, for example, bookstores selling just books to ... bookstores selling brain-exchanges and books are sold as an aftermarket or barbershops cutting hair to ... barbershops educating consumers on how to keep hair shiny with getting a haircut as an aftermarket -- a whole new experience that can only be purchased by bringing “neighbors” together. _It’s hard to dup that. _
  • Re: Event Mar. 24:  Going global with your small business
    soapinmama Newbie
    Currently Being Moderated
    When shipping product globally is there a better shipping agent versus another? What kind of extra fees does a company incur when shipping globally? What about customs? Are there basic requirements when shipping global?
    • Re: Event Mar. 24:  Going global with your small business
      justobitome1 Newbie
      Currently Being Moderated
      Are there certain countries that are easier to export to? Why?
    • Re: Event Mar. 24:  Going global with your small business
      ldelaney Newbie
      Currently Being Moderated

      There is but you won't know until you to start doing your homework. I addressed part of this question at the very beginning (refer to the question about filling a container) but the short answer is start with a known and reliable shippng company -- say, UPS -- for example because they can walk you through the process in a way that makes you feel confident and comfortable with what you are doing. Further, they will most likely quote you in a timely fashion with economical rates (no plug intended here!).

      Duties, customs, taxes, insurance (exchange rate) ... all have to be factored into the selling price to the customer. So you can present pricing in such a way as:
      • Price of goods
      • Price of transportation (and all other costs involved to deliver goods to customer's door).
      The bottom line is that ALL expenses should be included in your price quotation to your customer and recouped when you collect payment.

      By the way, look for a shipping agent who knows the territory you are about to ship to. This helps immensely and can save you headaches later on.
  • Re: Event Mar. 24:  Going global with your small business
    soapinmama Newbie
    Currently Being Moderated
    With going global and only speaking english, do you find there are language barriers?
    • Re: Event Mar. 24:  Going global with your small business
      soapinmama Newbie
      Currently Being Moderated
      How do you figure if going global with the current exchange rate if it's even going to be a profitable venture? The dollar isn't what it was worth 3 years ago?
    • Re: Event Mar. 24:  Going global with your small business
      ldelaney Newbie
      Currently Being Moderated

      When you first start out, I suggest you target countries where the natives speak your language: English (New Zealand, the UK, Australia or Ireland, for example). Why make it complicated? As you develop experience and an understanding of what it takes to expand your business internationally, start to think about expanding into other countries where the consumers are a perfect target for purchasing your product/service offering -- even if they don't speak your language!

      Down the road, yes, interpreters are a necessary ingredient to global business success because you want to keep growing globally -- right?
  • Re: Event Mar. 24:  Going global with your small business
    justobitome1 Newbie
    Currently Being Moderated
    How do you find experienced sales representatives over seas to help you meet and greet customers? Or do you have to plan for extended time overseas to make going global a go?
  • Re: Event Mar. 24:  Going global with your small business
    CommunityTeam Novice
    Currently Being Moderated
    Community please welcome Laurel Delaney from GlobeTrade. Please begin submitting your questions now. Don't forget you need to be logged into your user account in order to submit a question. If you don't have a user account simply select join now.

    And don't forget to refresh your screen so you can see Laurel's latest response. Laurel - thanks again for your participation. Please take it away and start answering people's questions!
  • Re: Event Mar. 24:  Going global with your small business
    CommunityTeam Novice
    Currently Being Moderated
    Community don't forget to refresh your screen to see Laurel's latest response. Laurel is taking questions now, so if you have a question simply login to your member account and reply to this thread with your question. Please note, we can't guarantee that Laurel will have time to answer all of your questions but she'll try.
  • Re: Event Mar. 24:  Going global with your small business
    MiGrant Newbie
    Currently Being Moderated
    A project that I'm working on right now involves sourcing American branded packaged grocery products for test-marketing in eastern Europe. A couple of people in the grocery industry that I've mentioned this to were horrified and thought that both I and my associates overseas could get into all kinds of trouble. Their main concerns seemed to be related to exclusive distribution agreements that we'd somehow be violating (even though we're not party to them). Now, as far as we've been able to determine, the products we have in mind aren't being distributed at all in the target country, much less on an exclusive basis. I've also been talking to some wholesalers who don't seem to think I'll have any problems at all. I'm aware that we'll have to address labeling and possibly any GMO content or other ingredients that may be restricted in the target market, but beyond that, are there any problems we need to watch out for?
    • Re: Event Mar. 24:  Going global with your small business
      ldelaney Newbie
      Currently Being Moderated

      I would go with your gut and definitely cross all your t's and dot all your i's before you take action. Food products are tough to bring into markets so start off by contacting: http://www.buyusa.gov/home (where you can find out anything/everything on a country you wish to do business in).

      Look for the country you plan to export to on an exclusive basis (check with an attorney when you reach the point of a contract because you want him/her to go over it with a laser sharp eye/mind) and select the country. Go to the left side bar and look for Contact Us. Find people are are experts in the "agricultural" segment of business. Then start firing away with your questions, including the ones you are asking me here!

      These people will definitely be able to answer all your questions and our tax dollars (assuming your are based in USA) pay for it.

      By the way, the wholesalers you refer to, are they in the country you wish to business or in the USA? If they are in the country you wish to do business, keep asking questions to learn more!

      Good luck -- go for it!
  • Re: Event Mar. 24:  Going global with your small business
    CommunityTeam Novice
    Currently Being Moderated
    Laurel, thanks so much for taking the time to share your expertise about how to go global. Community, that's all the time we have for now, but if you'd like to learn more about how to go Global, please visit http://www.globetrade.com.

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