The Export Advantage

Exporting American-made goods and services has become a hot topic as we slowly rebound from the domestic recession of the past two years. Timing is everything, and with a favorable exchange rate for the US dollar, prices are competitive again. 

Other factors in our favor include the global economic recovery, surging demand from emerging markets, the US Government’s financing and advocacy resources, and the cache of the words “MADE IN THE USA.” Service and manufacturing businesses in the New York area have much to gain from an expanding export market. 

They especially can look to the unique opportunities existing in nations with emerging economies such as in Eastern Europe, Africa, the Middle East, plus India and the awakening giant, China. But companies must first successfully navigate the process of exporting with countries that are new to trading with the West.

If an American company is not prepared, it will face many obstacles that could prevent it from doing business abroad successfully. 

Emphasis on Export 

President Obama made his goals clear when he initiated the plan to double US exports in five years, and he underscored it in his 2011 State of the Union address when he said we must learn to compete globally. He has mandated that US government agencies responsible for promoting and financing American exports, along with many trade organizations and non-governmental organizations (NGOs), to unite around a powerful common goal, thereby making it easier for small and mid-size businesses to enter the export market. 

Early results are encouraging, with the Export-Import Bank of the United States (www.exim.gov) just coming off of its best year of financing US exports, and the trade deficit at its narrowest in a long time. Despite the emergence of low-cost Asian and South American competition and a strong European presence, American companies remain, and will continue to remain, highly competitive in a number of sectors and industries internationally.

These industries include aerospace, medical equipment, construction machinery, agricultural equipment, telecommunications, technology services, environmental engineering, entertainment, food, hospitality services, architecture, and transportation. 

The Export State of Mind 

Skeptics say US companies cannot compete with low-cost goods and services from China, Brazil, and Korea; yet Germany, with some of the highest labor costs in the world, is an export powerhouse. Holland and Sweden also have highly paid workers, yet they succeed at exports.

Why? Business people in these countries think, eat, sleep, and literally live exports. It’s that simple. Their domestic markets are much smaller than ours, so they must look for business beyond their borders. They dig in and learn foreign cultures. They develop relationships and design goods and services that can be adapted in various countries. They are dedicated to finding ways of doing export business and nothing is going to stop them. And these companies are not all major European conglomerates. Untapped export opportunity exists for many small and medium-sized enterprises. International trade is simply not the typical mindset for American businesses, perhaps since historically we have been fortunate to have such a huge marketplace right here within our own borders.

But things are changing— quickly. There seems to be a lack of commitment and planning, as exporting is an afterthought to many US companies, when instead it should be a core part of that organization’s state of mind. I’ve seen it many times: a US business hires an international sales manager at the middle-management level—usually an American with extensive foreign sales experience. He or she is assigned a massive territory with a great sounding acronym such as EMEA (Europe, Middle East, Africa), often with little marketing budget or technical support. That person is sent traveling across the globe to look for qualified distributors.

I often wonder why, in contrast, even small American companies have domestic sales forces to cover multiple towns, boroughs, cities, or maybe even states, but overseas it’s acceptable for these same companies to assign entire continents to be managed by a single person with limited administrative and financial resources. What can be done to change this mindset? How can American companies open new markets abroad? 

There are seven key initiatives American companies should undertake to have the best chance for success in the export market: 

7 steps to becoming successful in the Export Market: 

1 Commit:

Senior management of any organization seeking to become a serious exporter has to understand the extent of the effort required to become truly internationally focused. It also has to be willing to commit resources—both human and financial—to execute its export strategy. Export is not something to be attempted on a shoestring. It also is important to avoid a disconnection between the international sales group and the senior management of the company. 

2 Explore: