A quick discussion about global business in this international business podcast.
The term “America” or “American” will always strike emotion overseas. Many other countries seem more neutral, but the United States has its history, its power and its media. Now more than ever, the United States is a controversial business ally. In addition to fighting two wars, we have a declining stock market, CEOs going to jail, widespread corruption in industry, banks that can’t lend and the biggest job losses in decades. How then, can we possible sell our wares abroad? How can we overcome the new stigmas that are being piled onto the old ones? Below are some survival tips for those firms that need overseas marketplaces. None of them are panaceas, (as there isn’t a single cure to our damaged reputation). No moralizing: Companies and universities throughout the United States are continually talking about corporate governance and business ethics. Some universities teach courses on it. Firms are discussing it more and more. The sad truth is that few people believe it. Few people overseas ever believed that the United States was the moral and ethical leader of the world. Now with constant scandals, CEOs taking bonuses the night before they receive government aid and a complete mismanagement of taxpayer funds, there is doubt we can ever talk about ethics without being laughed at. If you want to be taken seriously overseas, don’t talk about your corporate ethics. Ethics are a suit of clothes anyway, so it’s prudent to remember that an overseas customer may have different ethics than you and still consider himself to be ethical. Get local: The less you are an American, the less baggage you carry with you. If you can establish your firm as a local firm in your market (for example: you become a German firm in Germany), you will be seen as local. Localize your website, your marketing materials, your product and your staff. Let your German employees deal with your German customers. Find a partner: If you can wrap your product in a foreign partner’s wrapping, you are doing better. Better for you to supply the technology to a Japanese website, or put your cereal into a French box, than to go it alone. The more French you appear to be, the more likely your French customers will buy. Go person to person: Because international business is done though relationship, it’s time to think of yourself (not your firm or your country) as the business partner. You may be trapped in a country with controversy, and your counterpart may be living in an impoverished country, but it’s the two of you that have the bond, not your respective countries. Bank overseas: One of the first things that a firm selling abroad should do is have a local banking relationship. Make it easy for your clients to pay you locally. Ask them which bank they prefer to do business with. This will enhance transaction ease and trust at the same time. Remember we aren’t alone: If you’re realistic, you are carrying a sense of embarrassment with you. Because the current recession is indeed global, your counterpart’s country has its own woes and issues. If you can remember that whomever you meet may have a sense of shame greater than yours, you can work on future cooperation instead of assigning blame. Use “power distance” to your advantage: Power distance refers to the emotional distance between a citizen and those who govern the citizen. We call our president “Mr.” and critique him constantly (low power distance). We refer to our CEOs by name (often first names). Increasing that power distance helps separate you from your leaders. By contrast, the leader in Iran is called Ayatallah (reflection of Allah). Offer financing: With trust at an all-time low, be ready to finance your deals for your clients. If you are shipping sports drinks to Mexico, you may not get paid until way after the drink is consumed. Be ready to wait and assist your clients in financing. Be prepared to admit it: Telling an overseas business person that you don’t wish to discuss politics is the same as saying “I don’t want to know you.” Prepare to play the diplomatic role and be questioned on U.S. politics, progress and other issues. Admit our wrongdoings and ask for forgiveness. Don’t take it personally: Listening to someone badmouth your country, your company, your family or even your street isn’t easy. Remember, most people have their opinions shaped. Few take the time to realize that while we have many firms in trouble, we also have firms that provide good wages, clean jobs and add value to society. We have a recession; things haven’t ground to a halt. These pointers should be used at the best of times to help with international market shares. They are certainly necessary at the worst of times. Get the international business book here
“Let him talk to me when he’s on da ground.” – Benny Rendazzo, E 186th St, The Bronx “When I am strong why should I negotiate with you? When I am weak, how can I?” – Arab proverb This proverb is ancient, but in the era of collaboration and interdependence, it is an anachronism. Benny believed in negotiation and compromise, but only when he had the upper hand. Rendazzo’s fish market was an icon in The Bronx. He always had good fish and it was always cheap. One day a bunch of kids stole some fish from Benny. When Benny caught them he smacked them around with a large frozen tuna. These kids promised to make the situation right, but not until they had a few bruises and were covered in tuna mess. Once the kids knew Benny meant business, negotiations softened considerably. They had agreed to show up and clean up the fish stalls each night until they worked off the amount stolen, plus interest. It only took a few days but after that each kid had to take turns guarding the fish market. Benny wasn’t a bad guy, he just knew his ways. In today’s day and age Benny should have called the police. I think “fish smacking” is probably illegal. But Benny didn’t trust the police. And Benny did give each kid a fish dinner after their guarding post was over. See…not a bad guy. How does this translate to marketing? Well, too often we see companies with great ideas and decide that what they need to do is find a large firm and “partner” with them. But they are in the weakened position. They have a cool idea (whether it was finished or not) but no market, no marketing, no market traction, no sales, no money, and often, no clue. You also see this scenario with fund raising. We have seen ideas get funded, but any marketing pro would tell you it’s far easier to fund a company than an idea. Companies are entities with dedicated staff, products, sales & strategies. A manufacturer of nursing bras came to me some time ago, looking for funding or a “partner.” My counsel was to try to simply sell 100 bras. It’s the difference between plans and reality. Now you’re a company, looking for increased funding. Currently, I am talking to a medical company that wants to make a consumer product. They are meeting with the FDA, Universities, more Doctors, Professors and host of people who can’t or won’t write them a check. My advice?3D Print 500 of these medical devices and let’s sell them on the air (either internet or TV). Benny Rendazzo would agree with this approach. Once we have actual sales and clients, the “we will never, ever, ever, write you a check” people become less demanding, less powerful and quite frankly, less interesting. Often in marketing we are desperate. This is especially true when you have don’t have a sales focused company. Some firms drop all their energy and money into product development and think of sales as an afterthought. Companies say “We’ll get a sales guy” when they really need a sales mentality. In simple terms, why would anyone dump a lot of money into anything without really knowing that people want to buy it? Marketing should be the second call made. Get it in, get it in early. Marketing isn’t about beating someone with a fish or even needing to destroy all competitors. It’s about getting clients and in that way being able to soften those negotiations. If you were to speak with Universities, for example, they become a party that may accelerate development, but can’t control the company. Take the case of this book, which was alluded to in the introduction. If the decision is made to go with big, big, big, big publishers then my side of the table has increased clout once I have a self published book in hand. The beautiful by-product of that is that you don’t get the constant bickering over changing the manuscript…because it isn’t a manuscript, its a book! Get the marketing book here!
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