This piece was contributed by Alex Viva, Certified Global Business Professional (CGBP) and a certified Economic Development Finance Professional (EDFP).
“Unless commitment is made, there are only promises and hopes... but no plans.” - Peter F. Drucker
Exporting your products or services to another country can be a valuable source of growth and additional margins for your company.
Whether you are already exporting or are contemplating if you should, there are four cornerstones of international business to consider: Management Commitment; Product Knowledge; Operational Capacity; and Financial Capability.
Commitment is the foundation. Most people have the perception that you are either all in or not at all. However, commitment is making certain that a decided amount of resources is put behind the objective. Resources refer to time, money, personnel, operations and planning.
A commitment might be “all in” or it might be a commitment of minimal resources. What is important is that the commitment is intentional and deliberate. A good strategy can be developed and executed regardless of the value of the resources, but unless management commits those resources – at whatever rate – there are only promises and hopes, but no plans.
You are ready to consider the next three cornerstones after ensuring managerial commitment.
You know your product or service and any success you have obtained domestically. But do you know how it will react in other countries, with different cultures, values and language, different channels to market, different laws and restrictions, different perception of the value of your product/service, even different weights and measures?
The needs of the product may be different in the export market as related to the domestic market. Does your operation have the capacity to build the product to the required specifications? Do the required changes put too much stress on your manufacturing capabilities or delivery of your service? Can smaller lot sizes create more costs than you can competitively sell your product, and will the commitment of operational capacity strain your capability to produce for the domestic market putting your business in jeopardy?
What about your internal processes for packaging, documentation and logistics management? Does the business have the capital to invest in overcoming any shortfall your operations have in producing and delivering the product or service?
Exporting could put some strain on your finances and cash-flow. You may need to offer terms in order to be competitive; you may negotiate special pricing, your logistical costs could be higher, and perhaps the need to respond or get to market quickly will add costs.
Visiting markets to meet with customers or partners takes time and money to travel; it’s not like you can just walk across the street. Your business needs to have the financial capacity to overcome these challenges. Will the business need export working capital, and how does that differ from the needs of the domestic market to survive the foray into foreign markets? What is your risk-aversion level to payments and/or openness to billing in foreign currency? What margins are you ready accept to gain access?
These cornerstones affect each other, and a strong plan should be in place to make certain they all work together.
Not sure you are prepared to know all aspects of global trade (management, marketing, supply chain and trade finance)? Consider the Certified Global Business Professional Workshop this May through UNCW’s Swain Center.
The interactive workshop will prepare you for today’s global marketplace and connect you with like-minded individuals, putting all the pieces of the puzzle together for greater clarity as you venture forward in international trade.
Interested in learning more? Consider taking The Certified Global Business Professionals Course being offered by The Swain Center for Executive and Professional Education this May. Visit https://uncw.edu/swain/index.html for program details.
Alex Viva, CGBP, EDFP has been actively engaged in global strategy for 30 years. His corporate experience directing businesses in the most strategic growth positions in the high technology, consumer and durable goods industries includes worldwide marketing, sales and business development, international operations and general management. He was a critical component in leading international exposure and growth in four start-up technology companies and as a turnaround executive for divisions of two Fortune-500 companies. Alex received his dual degree MBA/MED from IESE at the University of Navarra in Spain, considered a top-five international B-school, and an undergraduate degree from Pepperdine University. Alex currently conducts seminars and lectures on all aspects of international business and counsels SMEs directly on international growth strategies for the SBTDC of the University of North Carolina System. He is an Adjunct Professor of Global Entrepreneurship and Importing/Exporting at SKEMA Business School USA campus in Raleigh, North Carolina.
Robert T. Burrus, Jr., Ph.D., is the dean of the Cameron School of Business at the University of North Carolina Wilmington, named in June 2015. Burrus joined the UNCW faculty in 1998. Prior to his current position, Burrus was interim dean, associate dean of undergraduate studies and the chair of the department of economics and finance. Burrus earned a Ph.D. and a master’s degree in economics from the University of Virginia and a bachelor’s degree in mathematical economics from Wake Forest University. The Cameron School of Business has approximately 60 full-time faculty members and 20 administrative and staff members. The AACSB-accredited business school currently enrolls approximately 2,000 undergraduate students in three degree programs and 200 graduate students in four degree programs. The school also houses the prestigious Cameron Executive Network, a group of more than 200 retired and practicing executives that provide one-on-one mentoring for Cameron students. To learn more about the Cameron School of Business, please visit http://csb.uncw.edu/. Questions and comments can be sent to [email protected].
Cece Nunn - Jan 19, 2021
Christina Haley O'Neal - Jan 19, 2021
Johanna Cano - Jan 20, 2021
Jessica Maurer - Jan 20, 2021
Jessica Maurer - Jan 20, 2021
The most-read stories of 2020 run the gamut from filming in Wilmington to some of the latest news about Port City-based firm Next Glass....
Residential and commercial real estate in the Wilmington area is expected to thrive in certain areas and struggle in others this year....
Several of the region’s economic development groups and organizations that are economic drivers check in with a recap of what happened in th...