Exporting Food And Sales Meets

Interrogatories:

What are the biggest mistakes small U.S. suppliers make when meeting with foreign buyers? 

Agree to a meeting without an assurance an order will be written.  Wait... what?  then how do you get orders?  By laying groundwork first before any meeting that pretty much assures that an order will be written.  Lots of contact, and better yet orders BEFORE any meetings with foreign buyers.  Meetings are where those complex, based on sales experience questions and "if-then" decisions trees can be hashed out where in two hours 2 weeks worth of confusing long distance communications can be completed.

In your experience, why do companies tend to not export? 

First, they do not see the opportunity.  Second, they believe it is necessarily more difficult and less profitable than a domestic sale.  No clear path to sales, and the tactics so burn up resources that the would-be exporter burns out.

And for those who start exporting, why do they quit?

Unsatisfactory results: wrong attitude - good deeds and big deals.  Their tactic is to try to find a big buyer to make exporting "worth it" and they offer much in the way of good deeds (Rewrite our label?  you bet!  Pay the freight?  Sure!  Big discount?  Perche' no?")  Next they are open to being all things to all buyers.  The best tactic is the opposite: one size fits all export offer, no good deed goes unpunished attitiude in discussions, no profits, no deal.  The former fails, the latter wins since one never needs to quit.

What tips/ solutions do you recommend to help U.S. suppliers overcome mistakes and make export sales as safe and as easily as a domestic one?

MOQ FOB; small, repetitive test orders, search and learn, minimal effort until discover a new market.

How should one view the sales meeting with a foreign buyer?

I put on my buyer hat.  I have X in sales, and I need about 20% new products each year if I want to stand still, let alone grow.  I cannot have a booth in a trade show or have my road warriors call on customers without something new to show.  I need new products for my old customers, and proven (old) products to show to new. So even if I have no plans to grow, I know what my OTB (open to buy) is for this year.  I know how much of something I can buy and sell it anyway.  And as an importer/buyer, I can find products that are tried and true overseas, but new to USA, so they are in effect new here.  And I know if I do find a hit, I want a supplier who can adjust to what my customers demand.

So say my OTB is ($1 million x 20% = $200,000)  And I know I can sell $5000 worth of any food product anyway, just by virtue of the market I have in place.  $5000 into $200,000 = 40 items I can test with no problem.  Good chance of finding something hot.  The higher the minimums, the fewer the tests, the lower the more, the better.

I am not going to take the time to study all of the legal ramification, permits, labelling of products when I have no idea as to market.  If I can get a supplier to drive themselves into bankruptcy trying to find all that in advance, I'll probably pass on working with them.  What I want is a small shipment to test everything, including logistics and the law.  I do ask what I can get for free, no matter what it costs the supplier.  I do squeeze on price, since I need to show my superiors I got the best price.  I may get a no on price cuts, but I must push anyway.  A "no" on price cuts never means I will not order.

So if I have a market for restaurant ingredients and some Chinese kid tells me he has fresh bamboo shoots, I am going to ask my customers in upscale restaurants (or I already know) about how much they can use as a test.  Say 12 of them at 5 pounds each, 80 oz in 1 oz servings (in a chow mein) they will have their waiters push.  Make news, enhance image, grow the biz.  So I know I can sell 60 pounds anyway, at $8 a pound, or $480.  Freight will be another $200, I'll sell for $1000,or $15 a pound.  Cheaper than they pay for the ingredient chanterelles.

And then I'll listen to the feedback.  No interest, nothing lost.  But at some point, I find the stars line up and people go crazy for fresh bamboo shoots, or whatever.  Then I am the go-to guy for that.  But I have to know this kid can ramp up and TCB. Then I make news, enhance the image, grow the biz

Now, if I am a buyer at an inbound, I want to work out problems on the one in forty that proved popular, assuming we've already done at least one deal.  If I have five of those from different companies to work with, then a week in USA may make sense, since I can save a lot of time with a face to face working out problems.  And maybe I can meet with other people with good products new to me.  I need 8 meetings a day, so 40 for a week.  then it might make sense.

I put on my seller hat:  Pre-meet work, to qualify buyers, pre-meet agreements with buyers, are they like what I described above?  Then we've already done a deal before we meet.   If not, I will wait until I have enough of those ready to go from my passive and active marketing so I am meeting with the above, so I can meet with eight different companies who have a known open to buy, then my time is worthwhile.  I'll sell them.

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post