Objections, MOQ FOB and the Sales Process

So you just put the MOQ FOB offer in front of a buyer, and you are shooting for agreement on need.  Out come the objections, which you must overcome.

Here are two I recently heard about.

A buyer asserted the Chinese consumer is far more impressed by packaging than content, the opposite from the USA.  The practical problem is after all of the costs of landing goods in China and taxes etc are added, the perceived value of USA goods, based on the packaging, do not command the prices necessary to sell in China.

Overcoming the objection: USA seller offers a sleeve (plain) packaging for the Chinese to reinsert into China-centric packaging. Since plain packaging costs the usa seller less for packaging on the export side, he passes the savings on to the Chinese buyer.  Not a novel solution. 

But what about traceability is the packaging is redone in China? Whatever the exporter was going to put on the package is incorporated in the production of the packaging in China.

But then won't there immediately be pirating of the USA product, if they do the packaging?

No.  

Who pirates unknown packaging?

Traceability trumps piracy.  It does not matter where the traceability is introduced, only that i tis effective.

I wish people understood that piracy is never a problem for the USA seller, only the Chinese consumer.  I realize that almost all Americans believe piracy in China is a problem for Americans, but that is just social conditioning.  It simply is not true.

Another objection:  The buyer won't buy without free samples.

Then they are not a buyer, because they are not ready willing and able to take your offer.  Your offer does not include free samples. But let's go a bit deeper.  What often happens with people who give free samples is by the time an exporter actually gets an order from one company, they are still net deficit for the expense of all the free samples they have sent out to various companies.  Having fedexed 100 samples at $75.00 each all in, for a total of $7500 over say a year, and finally get an order in which you net $5000, well, you are still underwater.  Better to have no business than that business.

The alternative is "no free samples" and go after real importers looking to test new products.

Of course one can set up BS filters and take the time to vet each inquiry for free samples, but that is a time killer alone, checking out 100 companies to find the one to which you will send out free samples.    Better to stick with no free samples.

Update:  If you are in the SF Bay Area late February, I'll be Foothill DeAnza College is hosting an all-day import-export startup course.

Class Description Come learn the strategies those thriving in small business international trade use to grow and build their business. You will be guided through selecting products, finding customers, working with governments, licensing, bankers, brokers, carriers, financing, costing, pricing and gaining orders for your products, all from a practicing professional. Highly rated by students for content, pace and humor. Recommended textHow Small Business Trades Worldwide by Instructor is available at on Amazon.com.  Class ID: 2907 Saturday, 9:00 am - 5:00 pm; 1 session starting February 22, 2014, ending February 22, 2014 Course Fee: $89.00 Instructor: Spiers Location: De Anza College, G Building , Rm. G-7       Map

You may enroll here....

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Finland's Gold

If gold is a barbarous relic, and has no place in a modern economy, why are Governments so reticent on the topic, and why do they use it at such an essential level?

“Maximum half of the gold has been within investment activity over the years. Gold has been invested among other things in deposits similar to money market deposits and using gold interest rate swaps. Gold investment activity is common for central banks. The risks associated with gold investments are controlled using limits, investment diversification and limitations concerning duration.”

Because people are crazy and make too much out of nothing?

Or because Governments feed the people the noble lie they badly want to hear?

I am not sure it much matters why.  The main point is to get the facts straight and then play the hand you are dealt.

Read 1 Samuel 8 for orientation (then 1 Samuel 12 for good measure) and here is a book which lets a lot out of the bag.  The part where Nazis and allies meet in Switzerland to settle accounts, in gold, during the war, for war materials is particularly interesting.    Give it a read.




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Walmart Faltering Overseas

Progressives hate Walmart because it makes billions by shifting costs onto the taxpayers while keeping the profits, a classic case of crony capitalism  They do not want WalMart to stop shifting costs onto taxpayers, they just want more of those billions in profits to spend on themselves.

Bill Gates avoids the hatred of progressives by doling out billions on programs progressives love.

Overseas, WalMart is faltering, because WalMart depends on crony capitalism that is not quite as forthcoming.

Wal-Mart is scaling back its international operations and has detailed plans to shutter poorly performing stores in two of its biggest international markets and concentrate on opening additional smaller operations across the US.
The move was motivated by what the world’s largest retailer sees as an increasingly “tough” and “unpredictable” global economic environment.

Take away the subsidies for welfare queens, and you'll see the economy improve.

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Senate Cracks Down On Snooping

The Senate has come down hard on NSA snooping, now limiting their activities to anything they want to do.  All past crimes are now retroactively permitted.

Sen. Dianne Feinstein, chairwoman of the Senate Intelligence Committee, said collecting information about phone calls is legal and is closely monitored, but she said it was right to put the NSA program on firmer legal footing and to add some privacy protections.
“The threats we face — from terrorism, proliferation and cyber attack, among others — are real, and they will continue,” she said. “Intelligence is necessary to protect our national and economic security, as well as to stop attacks against our friends and allies around the world.”

Feinstein has worked in government her entire adult life, and has amassed a fortune of some $100 million (as of 2005) all by her lonesome, independent of her "investor" husband.

You see, she is just that smart.  And absolutely not, does any intelligence agency have anything on her regarding how she amassed over $100 million while working for the government.  Or her husband.

In USA we get the best politicians that money can buy.

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Nevada Export Food Conference in Vegas

I am being hosted at a State of Nevada food conference at which I will be speaking for an hour or so on food and beverage export market development tactics.  It is an all day event, with plenty of other topics covered as well. Here is the official flyer, and here are the details and links to where you may register.

Southern Nevada Agricultural Conference

Instructor:

Santa Fe Station Hotel & Casino

Dates: 11/21/2013 - 11/21/2013                 

Address: 4949 N. Rancho Dr. Las Vegas, NV 89108

Days: Th  Sessions: 1 

Room: Meeting Room

Times: 9:00 AM - 4:30 PM

SKU: 128652 Fee: $55.00

http://www.campusce.net/wnc/course/course.aspx?C=287&pc=12&mc=49&sc=50

That $55 fee goes up to $60 after Nov 14, and in any event the fee includes lunch AND a continental breakfast.  It is limited to Nevada residents, but please feel free to forward this to those who might find the info useful.

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A Challenge of Sorts

007 checks in...

And therein lies the challenge for a non-manufacturer/export agent. He has to buy wholesale himself leaving no choice but to markup the wholesale price in his MOQ FOB offer. The importer then sees the markup and just buys EXW from the manufacturer, taking out the agent in the process. The agent needs to add more value somehow to make it worthwhile for the importer to deal with him. 

This gets to fundamentals.  I'll first address 007s points, and then I shall bloviate.

Set aside there are all sorts of deals, such as percentages based on volumes, paid by the manufacturer, to which an overseas importer may not be privy.  Assume the export agent shows his price and the importer overseas, the target customer, then consults the manufacturers website and find the ExW price.

Well, in the MOQ FOB template I send out, the manufacturer's price (ExW) is a separate line item, so we are in fact, and have been showing this all along.  What is new is to show what prices the USA customers of the said manufacturer are getting in USA.

So all along the buyer overseas has been able, should be able, to see the markup.  The false idea is in every case the buyer overseas will go direct.  This is demonstrably not true in the real world.

Yes, ExW is easy for the seller, but the buyer does not want it.  In some cases the seller will not go the extra distance to create an FOB quote, for misinformation as to the challenges thereof.

I prefer Hong Kong agents to buying direct in China for the simple reason Hong Kong agents kick ass and take names when things go wrong.  Sure I can go direct to ExW, but I am in a jam if and when there is a problem in some cases.

And so the reverse is true.  Buyers overseas want someone in-country upon which to rely in case of emergency.  Buying ExW Denver means Denver to Oakland is at the buyers risk.  A ten percent markup on $2000 in goods with will sell in Germany for $5,000 is cheap insurance to the buyer.

So the "added value" is already built in.  If you can also add other value, all the better.

At the same time, if your offer is no value to the buyer, then yes indeed he goes direct cutting you out.  Fail fast, fail early.  100 inquiries, zero sales tells you something.  Better to find out up front than later.  Better to lay out all possible info the buyer needs, and let the chips fall.

And if in fact you do get an order, obviously it is a well considered and solid business basis.  Prepayment at that point is not even an issue.

What is the alternative?  Truly much business done in USA is based on force and fraud.  First our currency, a system that is both force and fraud at once. Second mandatory purchases, such as medical care, which too is both force and fraud.  Third voluntary purchases where in we cannot possibly know what we are agreeing to, such as internet service or a mortgage.  So force and fraud is in the USA business DNA.

What is the alternative?  Total doisclosure, and build a solid business based on transparency and mutual benefit.

This is why I keep saying starting a biz in the USA is the most revolutionary act one can perform. And it is necessarily nonviolent and non-fraudulent.

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Bugging the Pope

Angela Merkel is outraged to learn her personal cell phone is tapped by the NSA.  Notice how she had not much to say when millions of Germans were tapped by the NSA.    But to find out they tapped her too... well.

The irony is it is not as though she would say anything anyone could not predict.  Tapping Angela's phone would be like tapping Rush Limbaugh's radio show.  Why?  You know what will be said.

The real problem is for businesses, working with the say, the Chinese, to have their trade secrets intercepted to the advantage of USA business.  Don’t think it does not happen.  Yes, it is funny when China tut tut's the USA actions, since they probably are tapping the NSA.  I still think it significant that neither China nor Russia snatched Snowden.  Nobody cared about helping him because they already had everything he had.

The only people who are kept in the dark by USA secrecy is the USA citizen.

Now we learn the NSA spied on the Pope.

No one gets fired...  If obama did not know, then Clapper and Alexander need to lose their jobs, spend some time in jail.  If Obama did know, they need to lose their jobs at least for failing to say no.

The Vatican has an interesting response.

Asked about the espionage claims, Federico Lombardi, the Vatican’s spokesman, said: “We have heard nothing of this and in any case we have no concerns about it.”

That is devastating.  Connie Rice when desiring to brush up her image while secretary of state gave the Vatican a call for an appointment with the Pope.  Since she was involved in promoting a criminal war in Iraq, the Vatican declined.  Her imaged was further in disarray.  The Vatican has the best diplomatic corp on earth.  To be deemed "of no concern" is to be royally dismissed.  The Vatican is viewing the best of what USA can offer as Childish.  As truly it is.

The entire point of this scandal is to put everyone on earth, everyone in power, including Popes past and present, that a few lifers in the USA "national security apparatus" have the dirt on every single person with any power on earth.  The scandal is a back door way to announce that "resistance is futile"  USA rules the airwaves.  Do as we say or we will out you and that dead girl or live boy in your past (or present).  That it is a worldwide blackmail is pretty clear.

The Vatican's laconic response may be a form of passive aggressive offense: ho hum.  Come and get us.  See what happens.

In this scenario, Edward Snowden may actually be a pitch-perfect agente-provocateur, revealing precisely what those gnomes with the data want released.  A world that fell for Sergey and Brin as brilliant entrepreneurs as opposed to In Q Tel central casting figures, which also falls for Lady Gaga (who went to the same summer camp as the Google lads) would fall for a Edward Snowden as hero.

What is also childish is something I am always astonished to see, people who think messages can be encrypted and note broken.  Perhaps there are some scientists who can make their own unbreakable codes, but is they sent anything of any interest some hard boys would show and get the key.  Silly to think otherwise.  If you get your "unbreakable" code from any source except do it yourself, that source would not exist in USA without the provider giving the key to the spooks.

I had a conversation with a fellow that told me he did ll of his communication on Skype since there is no way to hack it or spy on it.  OK, if you need to believe that.

No one gets fired, so we are let in on the practice, a scandal erupts, and then we settle down to the new normal.  Such is a democracy.  Now, in a Kingdom, it is different.  In Luxembourg vs USA, when there is a spy scandal, the entire government resigns.

That sounds about right.  Why can't we have that?

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The "Thanks a lot, Obama" Meme

In LA this weekend it was brought to my attention that all important 18-45 demographic has taken on the habit of saying in mock-disdain "thanks a lot Obama!" for everything in their lives that might be unpleasant.  For example, you trip on a shoestring "Thanks alot, Obama!"  You don't get through the the intersection while the light is green.  "thanks a lot Obama!"  Whatever.  Here is a website devoted to the meme.

To be funny there must be some truth, and the truth is "blame Obama" whose policies are simply Geo Bush's 3rd and 4th term, is designed to set the electorate for the next president, Hillary Clinton.

Now I am consistently wrong on this, but the republicans are taking another pass, through divide and conquer.  A strong tea party will make for a weak presidential candidate, but this can be very good.  Bill Clinton needed the Ross Perot faithful to win re-election, so Clinton worked for a very good economy and fairly peaceful eight years.  We should be so lucky.  Let's hope Hillary is half as smart as Bill.

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UC Berkeley Live World Trade Seminar

I'll be teaching an all-day intensive seminar for UC Berkeley Monday, November 18 from 8:30 am to 5pm in San Francisco, CA.  If you are in the Bay Area these seminars offer boot-camp start-up experience and time to get specific questions answered.  If you are not in the Bay Area, this is the one for which you should fly in.  

You'll learn to identify markets and sources, and everything in between.  If you plan to start up a business, or need to expand your business internationally, this seminar is unique for its tactics and attitude.  It is highly rated for content, pace and humor by the participants.

Bring a laptop, we'll be taking actions in the classroom to advance your business (wifi provided.)   There is plenty of follow-up consultation with the instructor.

Register now to assure a place in the class.  This one actually has Berkeley credit associated with the course, .8 of a CEU, which means if you are pursuing a degree the seminar goes on your transcript, if you want that too, and your employer is likely to cover the cost in your company education benefit program.

Email me if you have any questions.



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Add This to the MOQ FOB Offer Page

When making an MOQ FOB offer to a buyer overseas, buyers want their prices, plus documentation on the price ranges at retail in USA... that is, exactly what are the overseas buyers' USA peers getting in USA for the product?

What are buyers overseas doing with this info?

 Obviously, 

a. they are checking up on the exporter as to exporter's markups, 

 i. Check out maker's wholesale

 ii check out exporters price

 iii check out retail in USA - how does all that look?

b. making sure they have a good price

 i. can they get it elsewhere cheaper/better

 ii. can anyone else (in china) get it cheaper/better in usa

c. how to position in (say) China, given the USA info?

With Costco heavy in the MOQ FOB export offer, a buyer overseas does not want to test something out, find a market, only to find a competitor down the street is getting a better price through Costco than he is directly from you.

Secrecy and exclusives have no place in int'l trade.  It is your job to make sure all is known so people can make decisions.

Selling to Costco at the small biz level is usually a bad idea since it is outsized sales which one day can disappear, leaving the overhead to serve a costco but no sales from Costco to support that overhead.  A subproblem is Costco can wreck your export markets by exporting your product themselves.  Or, looked at alternatively, Costco may very well create export markets you did not anticipate.

The important point is, get the facts, lay it all out there, and make rational decisions.  No worrying about people going around you, no secrecy, no non-disclosures, no exclusives.  But you are free to decline a Costco order, which at the small biz level I would recommend.

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Why We Need Free Trade in Medicine

We are told we have the best health care in the world.  And too few can access it.  So we need to make access more better cheaper faster.  Chairman Mao orders China to produce more better cheaper faster.  He could not get it to happen.  Deng Xiaoping ordered more freedom, China got more better cheaper faster.

Do we have the best?  You think a patient gone missing for 17 days found dead in a stairwell will no longer happen?  Been to a hospital lately?  See what collectivization does?  You get more of what you subsidize.

If doctors cannot practice medicine for the rules and regs that destroyed the business, they lose hope and at the same time scamsters enter the field:

A study published in the New England Journal of Medicine suggests that profits urologists make from referring patients to their own radiation facilities play an outsized role in the treatment decisions. One third of men whose doctors own radiation equipment get the therapy at a cost of about $35,000 per treatment course. The same doctors prescribed the therapy for just 13 percent of their patients before they had their own equipment and could profit directly. Read more at http://globaleconomicanalysis.blogspot.com/#FB7aVFU4j3el4Zq4.99

At the same time, it's all your fault!

However, the CDC director explained that people have fueled the fire of bacterial resistance through rampant overuse and misuse of antibiotics....Srinivasan added that pharmaceutical companies are at least partially to blame for this problem, saying that they have neglected the development of new and more sophisticated antibiotics that could keep up with bacterial resistance because ‘there’s not much money to be made’ in this field.

Read more: http://www.dailymail.co.uk/news/article-2477273/Weve-reached-end-antibiotics-Top-CDC-expert-declares-miracle-drugs-saved-millions-match-superbugs-people-overmedicated-themselves.html#ixzz2jA5kQei5 

Do you recall ever asking to be overprescribed for antibiotics?  Now, also note, "there's not much money to be made" by welfare queen billionaires, but plenty of money to be made by you and me selling the immediate solution in bacteriophages, if we had freedom in USA.  You and I do not require 50 million cash a year to show up for our jobs.

Also note the Surgeon General of the United States does not mention this option.

All those hoping for single payer health care can look forward to UK style medicine, where the doctors a paid a bounty to give mom a nudge into "no care."

And this from Syria:

Ten cases of polio have been confirmed among children in the war-torn Syria, the first ever reported in the Middle East country since 1999 and making it an urgent task to vaccinate Syrian children against the epidemic, the United Nations said Tuesday.

What we need is no war, not vaccinations.  The UN must condemn USA meddling in that country, with USA supporting Al Qaeda with weapons and intelligence, the side that will not destroy the chemical weapons.  This is exhibit A why the vaccination initiatives must be resisted: there is no upside, and if there are wars, vaccination does no good anyway.

After WWII, the damage done when on for decades, with polio as one example.  But but but what would happen if we did not have the government to make all decision for us?

No idea... thing like this:

The carpenter lost two fingers and mangled two more on his right hand. While still in the hospital, he was determined to find a way to get back to work. Eventually, solving his own problem led him to work with a stranger on the other side of the world to create a mechanical hand using a 3-D printer. Other prosthetics, including a lower jaw, have been made with the technology before, but making a hand is particularly tricky.Read more at http://globaleconomicanalysis.blogspot.com/#pLif74UyCe2Y3EFJ.99

With Romney/Obamacare, or single payer which is next after we get done blaming the black guy, expect far more of the bogus treatments as above and outlawing $5 prostethic hands.  And NO bacteriophages.  You'll need to be in int'l trade to get competent healthcare, so you can travel to where there is freer trade in medicine.

We could turn our economy around if we deregulated health care.

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You Cannot Get There From Here

I like a difficult question, and the one the other day regarding how long it took to be, or when I realized, I was successful is one such question.  Why does it make me anxious?

I gave one reason, and that is "how do you define success?"  I'v3 actually blogged on this point before, with the highlighting the conundrum that the questioner's idea of success and mine would be at odds, so why ask?

Next the premise is there is a formula to follow, and there is not.  As I said there are tactics and attitudes that matter, tactics are not negotiable, but attitude gets to the person, so that is negotiable.

But here is the core problem: the question implies one goes into business for oneself.  Not quite true.  Yes we go into business because it s the only legitimate work for a person given our unique intellect and free will in the animal kingdom, but there is the paradox that we are only "succeed" in the measure we serve others.

"When did I succeed?  I don't know, you'll have to ask my customers."  We are not self-employed, we are customer-employed.  Business is not the core of the life, but just another manifestation of who you are.

In the movie industry they say "You are only as hot as your last film."

So I think the problem with the question is it proceeds from a place whence you simply cannot get to where you want to go.  If you ask "how to be successful" then you are oriented in the wrong direction. You simply cannot arrive at happy customers from the question "how long did it take?"

Anonymous wanted to know how long it took for me to "be successful."  Martin wants the whole world see his website for getting Chilean beer down appreciative gullets.  Nice juxtaposition.  Which one will be "successful" first?

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How Will We Pay Chase's 13 Billion Dollar Fine?

As soon as I heard regulators and Chase agreed to a $13 billion fine for, well whatever, my first thought was how were we going to pay for it?

JPMorgan Chase has come to a tentative agreement with the U.S. Justice Departmentto pay a record fine of $13 billion in a settlement with state and federal regulators. The bank still faces a U.S. criminal probe into its mortgage bonds along with more than a dozen probes globally.

One thing for certain was Chase itself was not going to pay it, no one at any corporate, decision making level was going to pay it, and certainly the effects of criminality in the banking system was not going to show up in the paychecks or bonuses of those responsible for the criminality.  Their sinecure was going to continue, since that is how capitalism works.

Mish Shedlock, reporting in another context, explains exactly how we will pay Chase's $13 billion dollar fine.  Mish does not relate his story to the fine payment, but this is how the "watchdogs" in government on one hand pretend to punish a wrongdoer, and on the other hand make the rest of us pay.  Until the $13 billion dollar fine is paid, you'll just have to do with less.

The reason usury is forbidden is because it does damage.  The amazing part is we need absolutely sero usury (interest on  loans) to make a modern economy work.  Usury is no more necessary to business than gambling is to enjoying life.  Yes, some people believe thay cannot be happy without gambling, but there is another area where participation presents only downside to the players.

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Anarchist's Bible Passage of the Day

Jesus offers a parable about how we, the putative masters in a democracy, should deal with state workers.

Although the deal offered to state workers could never be honored, now it cannot be honored.  It is starting in Detroit, The state of Wisconsin, certain California cities, where the pensions are being repudiated.

Those who followed the get big or get out policies of the state toward small business are finding the program worked, and the destruction of middle class small business in USA means no money to cover the promises made to the workers who delivered on the policies.

Now I've written about Government employees and a paradigm shift to transition out of government work, but the bible has even a better idea.

16 Then Jesus[a] said to the disciples, “There was a rich man who had a manager, and charges were brought to him that this man was squandering his property. 2 So he summoned him and said to him, ‘What is this that I hear about you? Give me an accounting of your management, because you cannot be my manager any longer.’ 3 Then the manager said to himself, ‘What will I do, now that my master is taking the position away from me? I am not strong enough to dig, and I am ashamed to beg. 4 I have decided what to do so that, when I am dismissed as manager, people may welcome me into their homes.’ 5 So, summoning his master’s debtors one by one, he asked the first, ‘How much do you owe my master?’ 6 He answered, ‘A hundred jugs of olive oil.’ He said to him, ‘Take your bill, sit down quickly, and make it fifty.’ 7 Then he asked another, ‘And how much do you owe?’ He replied, ‘A hundred containers of wheat.’ He said to him, ‘Take your bill and make it eighty.’ 8 And his master commended the dishonest manager because he had acted shrewdly; for the children of this age are more shrewd in dealing with their own generation than are the children of light. 9 And I tell you, make friends for yourselves by means of dishonest wealth[b] so that when it is gone, they may welcome you into the eternal homes.[c]

So beyond thinking of their employer, the Government, as their client, the workers should think of the people as their vengeful master and begin using their positions to benefit their victims.  Their dishonest wealth (money that is taken from taxpayers against their will is dishonest wealth) is used to make the lives of those whom they will soon join, people trying to start businesses, find the rules and regulations being rolled back as easily as they were rolled in.  A fee for this?  Forget it.  A regulation on that?  Never mind.  Let th insurance companies get back to what they did before the rules and regs ruined their business model, and have the insurance businesses handle safety and security.

So the bible is a help to people now in government who see clearly they will be joining us soon.  Of course they neither want to beg no dig ditches, but they can so help those who do,and those who produce, that the economy will flower to the extent they can find gainful employment.

And anarchists yet again find the bible full of practical solutions to practical problems in restoring of anarchy.

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