Exhibiting overseas is one of the
fastest and most cost effective ways to
identify the best foreign markets for
your products/services.
International
trade shows and fairs offer
opportunities for multilateral contacts
and business deals.
They allow you to
test your product’s export suitability;
explore the strength and scope of your
competition; and gain exposure to
potential suppliers, in-country
distributors and customers before
making any sizable financial
commitments.
However, to effectively
trade internationally, top management
must commit to developing foreign
markets.
More than 2,000 shows are organized
worldwide each year, and approximately
150 of these events have significant
global attraction.
Most are held in the
major trade show centers in the United
States, Germany, France, Italy and the
United Kingdom.
The following A-Z
guidelines will help to take the fear
and anxiety out of your overseas
exhibiting ventures:
Ask questions and thoroughly research
overseas shows to find the ones that
attract your target market. A good
starting point is the U.S. Foreign
Commercial Service (FSC), part of the
International Trade Administration of
the Department of Commerce.
Other
sources of information include banks,
trade associations, foreign embassies
and consulates, bi-national chambers of
commerce and the Internet.
Book space early. Allocation for space
is a "first-come, first-served" basis.
Applications for space need to be
submitted as early as possible — 12-18
months prior to the event.
Reservations
are made with the show organizer or
their international representative.
Most of the large shows, especially the
German ones, have global sales offices.
Coordinate shipping arrangements. Most
international trade shows have an
officially designated freight forwarder
who is familiar with all the relevant
details.
They will handle the
invoicing, arrange for licenses and
declarations, prepare packing list,
issue bills of lading, handle insurance
and prepare all necessary
documentation.
A duty charge is not
normally assessed on equipment, unless
it is destined to remain in the country
after the show ends. An international
carnet facilitates importation and
movement of samples and professional
equipment between countries.
Determine that your product complies
with international technical and safety
standards. Germany, in particular, has
extremely stringent laws regarding
testing products to comply with
applicable specifications.
Overseas
companies are allowed to exhibit
products at German trade fairs before
their products have been inspected.
Formal certification of required is
necessary to legally sell your products
in Germany.
Certain types of
merchandise are also subject to
specialized safety codes and technical
requirements. It is advisable to use a
local consultant to help you through
the compliance process.
Establish a realistic budget. Costs of
overseas shows vary widely, depending
on a host of variables, for example,
location, exchange rates, time of the
year.
In addition to your display,
shipping, promotional and staff costs,
also take into consideration, import
duties and export regulations. As a
safety net, add 25% to your budget to
cover unexpected costs, tipping and
exchange rate fluctuations.
Familiarize yourself with overseas
union policies. Strong unions exist in
the U.K., France and Italy. Understand
and appreciate the rules and treat
everyone with respect.
Offering to buy
your union labor lunch or a beer, as
well as tipping, often helps to
minimize pilfering, loss and damage.
When working with contractors, always
have someone who can speak the language
and give logistical instructions.
Arrive at least a week prior to the
show to iron out any kinks.
Get to know pricing. Your company
representatives should be prepared to
negotiate and agree to terms at the
show. They should also be fully
conversant with tariffs, the European
Community’s Value Added Tax (VAT) and
other tax implications, and importation
and delivery procedures.
When quoting
prices, most buyers expect prices
quoted c.i.f. (cost, insurance,
freight), including duties, taxes and
other charges. For a small fee, local
freight forwarders will assist and
prepare c.i.f. costs.
Have arrangements for credit and
payment. You should make arrangements
with a bank that has international
banking affiliations to facilitate your
banking needs. Discuss arrangements for
transfer of funds, letters of credit
and bills of exchange.
Potential
customers or representatives will
expect a credit check. Individual
profiles on overseas companies can be
found through the World Trader’s Data
Reports, available for a small fee from
the US Commercial Service.
Since exchange rates fluctuate daily
and can affect pricing, especially when
dealing with Latin American countries,
consider getting paid in U.S. dollars.
Insist on using a native-born
translator. When translating copy or
business communications, always hire a
local translator who has technical
knowledge of your products/industry.
Embarrassing mistakes occur when a
translation is done by a non-
professional with limited knowledge of
a language and little or no
understanding of slang, colloquialisms
and double-entendres.
Prepare
product/service literature, data
sheets, catalogues, etc. in the
principal languages of the major
countries represented at the show.
Remember that most countries outside
the U.S. use metric measurements.
Judge the context. Some cultures are
more direct and explicit in their
communication. Swiss, German and
Scandinavian cultures are considered
low context. Their words have specific
meanings.
In contrast, Japanese,
Chinese and Arabs are high context.
Their language is often vague, inexact
and confusing for English-speaking
cultures to understand. Reading between
the lines is a must.
Keep language simple. Many of your
international business contacts will
speak English. Problems occur when you
use slang, colloquialisms, idioms,
jargon, buzz words, lingo, officialese,
acronyms, and metaphors. These are
often difficult to translate.
It is far
more effective to keep communication,
written and verbal, basic and easy for
anyone to understand.
Learn to speak body language. Seventy
percent of our communication is
nonverbal. We communicate by the way we
stand, sit, tense facial muscles, tap
fingers, etc.
There are also hundreds
of gestures to get across almost any
meaning, from greetings, beckonings,
and farewells, to terms of endearment
and insults. Gestures and body
language, with the exception of
smiling, are not universal in meaning.
Be aware of the etiquette on personal
space, eye contact and when, what and
how to touch.
Make sure that your top executives are
available. Overseas shows, particularly
in European and Asian countries, are
serious business as they focus on
sales. Top-level management attend
these shows expecting to place orders.
They expect, and want, to deal with
their counterparts in your company.
They expect to spend time discussing
technical details and will often want
to close major deals on the show floor.
Technical staff, sales people and in-
country representatives will help form
a complete team.
Nail negotiating. Negotiating in
international business is extremely
complex. Socializing is often
considered essential to the negotiating
process. Learn the cultural rules,
especially as they relate to timing and
how business is conducted. Patience is
often a real virtue.
Offer quality and uniqueness. High
quality products and services are
expected, particularly when dealing
with the Japanese and South Koreans.
The packaging is as important as the
product. If your products and services
compete directly with native companies,
there needs to be something unique in
the technology, innovation, design,
styling or image to gain acceptance in
the Asian market.
Plan on having a third-party contact.
Many Asian and Latin American cultures
prefer to do business with people they
know. Meeting the right people often
depends on having the right
introduction.
If the person you wish to
meet respects your intermediary, then
chances are you too will be respected.
Question whether "no" really
means "no." Much confusion, frustration
and irritation can occur when different
cultures communicate real meaning. In
some countries, such as France, "no"
can often mean "maybe’ and "maybe" can
mean "no."
In many Asian cultures,
individuals will not say "no" outright.
Rather, they use subtle clues, for
example, saying "It’s very difficult,"
or "I’ll consider it." A "yes" or a nod
of the head may very well mean "maybe"
or "I understand," instead of it being
the affirmative response you might
interpret.
To avoid saying "no,"
Koreans in particular will often give
you the answer they think you want to
hear. Learn to listen to the subtleties
by asking open-ended questions. It is
at times like these that a cultural
mentor can be particularly helpful.
Recognize the role of women in
business. Research the customs of the
country you are visiting as they apply
to women. Although female business
travelers account for one of the
fastest growing segments of the travel
industry, problems still exist.
Be
prepared to prove yourself as you may
not be taken as seriously as your male
counterparts. Familiarize yourself with
local and regional attitudes and
cultural differences about women in
business. This will help to define your
approach and avoid potential problems
and embarrassing situations.
However,
business overseas is based on trust and
relationships. And women, like men, are
responsible for creating the necessary
rapport to accomplish their goals.
Supply all your company representatives
with bi-lingual business cards. In
Europe and Asian societies, business
cards are essential. They act like a
business passport.
For countries where
English is not widely spoken, have
cards printed on the reverse side in
the local language. This is best done
in the country you are visiting. Also
be aware of the specific etiquette that
exists, particularly in Asian
countries, for presenting cards.
For
example, in Japan, business cards are
exchanged ceremoniously using both
hands and a bow. Both parties will read
and study the card. It is extremely
impolite to write notes on the card or
shove it in your pocket.
Train your people. Make sure that the
people who represent your company at
overseas shows are well trained and
know and understand the cultural
differences of the people with whom
they will interact.
They should know
how to greet and address visitors.
Formality is the norm in Europe,
whereas a more casual and friendly
style is acceptable in the U.S.
Understanding different business
negotiating styles, conversation
sensitivities, and how women are
treated in business, is essential, in
addition to knowing eye contact,
handshakes, body posture and spatial
distance differences.
The key is to
develop relationships of trust and
sincerity as they are critical for
successful business.
Use ATM’s (Automated Teller Machines)
to get local currency. They give you
the wholesale exchange rate of 5-10%,
which is a far better rate than you
would get at hotels or currency
exchanges.
Always try to purchase
enough local currency before leaving
home to pay your transportation from
your destination airport to your hotel,
plus a little extra for tips.
Value different decision-making
processes. The key is not to sell but
rather to build relationships. Decision-
making differs around the world.
For
example, in Asian cultures, it starts
from the lower levels in the
organization, and works its way up the
ladder. Many times, lower level
employees will visit a trade show to
gather information, which they will
include in a report to a higher
manager.
Don’t expect a decision from
an initial meeting. Decisions are
usually made collectively, and the
process is often slow and thorough.
However, once a decision is made,
especially in Japan, a quick execution
is expected.
The key, once again, is to
do your research.
Watch out for cultural differences.
Know and understand the cultural
differences of the people with whom you
will interact. Be sensitive to color
and symbols and their meanings in
different countries.
For example,
mourning is symbolized by white in
Asia, purple in Brazil and yellow in
Mexico. If your product, packaging and
literature are in the wrong color, you
will lose sales.
Red and yellow are
lucky colors in China — conversely,
never use red printing in South Korea.
In many of the Asian countries, the
number four denotes death and should be
totally avoided, including products
packaged in fours.
If possible, avoid
the number nine, as it has connotations
of suffering. Seven and eight are
considered lucky. Be safe and always do
your research!
Expect to follow-up personally.
Personal contact and immediate follow-
up after the show is the best way to
establish foreign buyer/seller
relationships to produce future orders.
Yield to a time investment. Building
relationships is a key component to
doing business overseas. Behavioral
differences are real. It is wise to
recognize them and to make allowances
when doing business.
Willingness to
cultivate business contacts through
personal visits plays a major role in
export success. Plan regular visits to
your major buyers, agents, or
distributors.
Be available, interested
and quick to react to problems or
complaints.
Zero in on the fact that doing business
overseas demands time and patience. It
may take several appearances at trade
shows before your company is taken
seriously.
Foreigners want to feel
confident that you are sincere and
totally committed to your involvement
in their country.