In comes a inquiry, from a NGO asking assistance, my comments between the asterisks....
John
Feel free to forward this by email to three of your friends.
We have just recently launched our Export Incubator program which is designed to help exporters here in (Overseas Country) tap into the US marketplace.
***Very good...***
Our program involves training and mentoring on things like how to communicate with importers, properly pack and ship goods, register with the FDA, and all that other technical stuff.
***Often this is counterproductive...***
Another component of the project is simply finding data on importers in the U.S. - I have identified sites like Piers and Import genius, ect.
***Not a useful vein to mine....cannabilizing current trade is not net development, there are better means for better results..***
I just wanted to ask if you had any other advice given our particular situation. We are trying to line up exporters here (exporters with innovative goods that we think will be competitive) with importers in the U.S.
***My advice would be to assume you have no idea what would sell in USA, and design a program based on that...***
A lot of these exporters will be looking for very niche markets while others may be medium to large enterprises. Any help would be appreciated.
***Test for companies competing on price vs competing on design... then I’d not bother with any company competing on price. This would limit your efforts to necessarily the small and medium firms. Competing on design and competing on price are mutually exclusive tactics and processes.
Working with a freight forwarder, have the prospective exporter design a minimum order quantity, FOB shipment quote, (MOQ FOB) with all particulars provided on a single sheet. If a website is possible, publish that sheet. Two parts: the exporter is going for the smallest rational export order, not the largest possible, all risk is on the USA buyer, not the Moroccan seller. The process is test order, not “new customers.”
Do not try to make anyone an expert in int'l trade, forget teaching incoterms, etc... make them expert, via the freight forwarder, on the one sheet of paper that is the MOQ FOB sales offer (if and when a market is found through selling MOQ FOB, then they may learn a little more about the biz...)
Next search google for the names of trades shows in the usa that carry the products being sold (fancy food shows for figs, home furnishings for carpets, home improvement for tiles, etc) Find the name of American exhibitors at these shows, drill down in their product mix and find say 1/2 dozen potential USA buyers of the product, and then by snail mail, never email, send the MOQ FOB quote soliticing business. A piece of paper in an envelop through the postal system. It is the only way the offer will get read.
Anyone you are assisting should be communicating with decision makers, people ready willing and able to buy, within several weeks. They should be shipping goods to USA within that time, or if not, know why not, from the only people whose opinion matters, USA buyers. With rock solid feedback, they can decide if they want to make what changes are necessary, or not. The Moroccan will know what he is talking about.
There is a pre-step I’ve left out since your brief is only USA trade. Personally I would teach how to use raw world trade data to search and learn new customers worldwide. World trade practice is also about defending home markets, and being apprised of world trade patterns gives even a small trader wonderful unseen opportunities from time to time.
John
Feel free to forward this by email to three of your friends.
7 comments:
http://www.cbsnews.com/news/how-we-landed-on-targets-shelves/
http://articles.baltimoresun.com/2011-06-27/business/bs-bz-chesapeake-candle-plant-20110627_1_manufacturing-jobs-pacific-trade-international-regional-manufacturing-institute
http://www.inc.com/kathleen-kim/mei-xu-crossing-borders-with-chesapeake-bay-candle.html
This company managed to get their products placed in big conservator companies. is this a different strategy that can work to build a business?
Admirable work on her part! What is the strategy in question you perceive?
They apparently did make unique candle designs, but targeted big, conservator stores (Target - a big-box store, and also, Bed, bath & beyond, Pier 1 Imports, Kohl's). They also have their own factory in Maryland - I would think that this would be more trouble than it is worth (So they usurped the "best" candle making factory in the world? They should have taken advantage of the already existing candle making factories expertise) (see first article). They apparently made it work for them, I suppose persistence can pay off. I still think that they should have read your book - they would have done better, faster, I think.
Here is a problem with an individual story: what strategy can be gleaned? There is so much hot money flowing and gamesmanship of rules that when I hear China Factory/ USA factory Target, etc, I wonder when is it a candle business and when is it a financial services business. Check back on the story in three years, the world will be a different place them.
I'm not sure what you mean by their company possibly being a "financial services" business?
I don't mean their company, only looking at any company for any particular lesson. Trends, not instances.
Macy's loses money on its sales of products, it makes money on the interest charged on their charge cards. Is Macy's a department store or a financial services company?
Reminds me of Amazon:
http://www.ibtimes.com/amazon-nearly-20-years-business-it-still-doesnt-make-money-investors-dont-seem-care-1513368
Amazon can also be considered to be a financial services business sort of, not profitable (or very little net profit), but their stock price keeps going up and investors keep buying it. I do believe they make money from their Prime credit card though.
Post a Comment