The aim is to ensure the right balance between levels of production, inventory, transportation and customer supply, to identify all potential resources, and to use the most appropriate resources in the most effective manner.

Taking a comprehensive approach to ensure supply chain planning success

A supply chain plan is a written document that details the strategy a company must employ to develop or improve a global supply chain.

Supply chain plans must have the following qualities:

1. They must ensure end-to-end management of the supply chain.
2. They must be as simple and as streamlined as possible.
3. They must minimize the complexity of supply chain operations to reduce costs.
4. They must include clear processes that can be understood by all users.
5. They must be able to be reliably applied across the supply chain.
6. They must be adaptable in response to changing customer demands or business conditions.
7. They must map to company strategic objectives.

Use your supply chain plan to add value to your entire business

Before starting to map out a global supply chain plan, managers must have a very clear idea of their company’s business plan.

A business plan is a company’s formal statement of its business goals and its plan for achieving them. For companies wanting to trade internationally, these goals will often have a financial focus, such as improving profits or reducing costs.

They might also focus on branding issues, such as improving customer perceptions, or be based on new research and development initiatives.

Examples of strategic business goals include the following:

• To become the global leader in the industry
• To improve customer service in one or more markets
• To develop innovative new processes
• To ensure a low customer turnover in identified markets
• To become more competitive in the domestic market
• To achieve a set level of growth and profitability
• To invest in global community initiatives and reduce the company’s environmental footprint
• To establish a sustainable, competitive entry into a foreign market

Follow through on your plan to achieve strategic goals

The strategic goals outlined in a business plan will have an important influence on the strategies that must be used to develop or improve a supply chain and on the way in which a supply chain can be structured and managed.

They will also indicate the types of improvement that need to be made in the supply chain.

For example, if a company’s business plan states that a goal is to improve customer satisfaction levels in a foreign market from 85 percent to 95 percent, managers will want to identify where changes can be made in the supply chain to increase customer satisfaction.

Perhaps the company can establish distribution centers in the market to reduce the time it takes for products to reach customers. Perhaps the company can collaborate with another organization in that market to provide a service directly to local customers.

Companies that map their supply chain plan to their business plan in this way are more likely to see improvements in their business performance.

Your supply chain plan can be a top priority for your business

Different divisions within a company and different company initiatives will always compete for access to limited funds within a corporation.

Often, supply chain initiatives that require capital expenditure are in competition for the same funds as other projects.

One strategy that can be used to increase the likelihood of successful supply chain project financing is to make sure the project closely links to corporate objectives.

The fact that that the project can increase customer satisfaction while reducing administrative costs should be articulated so that company executives understand that it will increase returns on investment.

What steps do you need to take with your supply chain planning?

The post Become your business’s supply chain superhero with these 7 tips appeared first on Trade Ready.

While Alberto was trained and experienced in electrical and mechanical engineering, he was unable to find work in his field once he immigrated because he didn’t have any Canadian experience.

After some career counselling, Alberto was urged to transfer his skills and go into sales to help companies grow their business into foreign markets. He took that advice, signed up for FITT-accredited international business courses, and made a game-changing shift in the direction of his career.

Launching a career in international trade

Before Alberto could even finish his courses, he was offered a job as an export sales manager. The company sold products used in mining, and was looking to grow its business into Latin America; specifically Chile and Peru.

Since starting in international trade, Alberto has worked in over 20 countries around the world. He speaks English, Spanish and French fluently.

His current role now has him specializing in the sales and marketing of electrical and HVAC equipment to global markets, including Latin America, the Caribbean, Europe, Middle East and Asia. He says his technical engineering background provided him with the strong foundation he needs to understand complex applications and the implementation of new technology.

Looking beyond the risks to start succeeding international business

Alberto’s company is now expanding into his home country of Mexico, and that’s his lead role.

“It’s very simple in a way,” says Alberto of entering new foreign markets. “You just have to find and understand the market, map out who your customers are going to be, and develop a strategy to go out and get them.”

Although the process can be simple, there’s still a lot of hesitation within other Canadian companies to grow globally, says Alberto.

Canadians are particularly conservative and they don’t enjoy risk as much. It’s a Canadian cultural fear.

But that fear of risk is also a good thing in some ways, he admits.

“Canadians being conservative and a little bit risk-adverse is what saved us during the financial crisis in 2008,” he says. “You don’t go out and buy a house and then borrow more money from the bank to go and expand your business.”

However, that aversion to risk becomes harmful for Canadian companies when it comes to succeeding in international business.

There are a lot of mechanisms to make it safe, and there are always ways to reduce the risk. And the reward is there. There are always so many opportunities.

Alberto also feels that having the benefit of the U.S. right next door deters a lot of Canadian companies from looking elsewhere to do business. They become comfortable and familiar with doing business so close to home, and expanding beyond that seems risky and obstacle-ridden.

But like with anything in life, knowledge can help companies overcome the obstacles and manage the risks in order to succeed, he says.

Contributing to the global business community

Alberto finished his FITT-accredited courses in 1996 and went on to become a CITP in 1998.

Once I became a CITP, it became clear to me that the designation needed to be known. There’s strength in numbers.

Twelve years later, he affiliated himself with FITT even further by being elected as a member of its Board of Directors. In this role, he continues to spread the word about the designation, and reinforces the benefits and standards it provides to the global business community.

Alberto is very passionate about the work he does in international trade, and he sees many opportunities for Canadian companies to do more business all over the world.

“I think as a Canadian who wasn’t born and raised here, I’ve done very well in Canada and I want this country to be better, and the only way we can have a better economy and a better life for everyone is if we trade more.”

The post Succeeding in international business by having the knowledge to overcome trade risks appeared first on Trade Ready.

In considering strategic choices, it is important to determine what is really necessary as opposed to what is simply wanted.

What are the strategic options for moving the company from its current position to the desired one? If the goals can be met through in-house efforts within a reasonable period and at an affordable cost, then a partnership might not be needed at all. If a main gap for meeting a strategic goal is financial constraints, a company might consider looking for investors rather than partners.

However, if there is still something missing, such as special expertise or market presence, partnership options must be examined more closely.

One of the benefits of going through this consideration process is that it clarifies what a company needs from a partnership. It helps define the type of company needed in the alliance and gives a better picture of the skills and resources that the ideal partner must have to make a trade venture successful.

1. Service offering
A company should assess the products and services it offers to its customers from the foreign customer’s point of view. Missing components and products or services that could be improved should be noted.

2. Human resources
The company should examine the capabilities of employees in the areas of language, knowledge of the target country and personal contacts there. Could they do the job alone? If not, what specific capabilities do they lack?

3. Familiarity with the market
The company should evaluate its understanding of the target market to determine whether it is sufficient to launch a successful marketing program. Notes should be made of gaps in the firm’s knowledge.

4. Process and technology
The company should assess its production processes, technology and methods of operation. Are they appropriate to the target market? Are storage and handling, after-sales service, and training resources available?

5. Financing
The company should estimate the financial resources needed to enter the new market to determine whether it can undertake the venture with internal resources. Does the company have access to debt financing that would make a partnership unnecessary?

How have partnerships helped you with your market entry strategy? Are there other important factors to consider when selecting a partner? Share your experiences!

The post Five ways to identify partners for an effective market entry strategy appeared first on Trade Ready.

Everyone was prepared to sign on the dotted line; Ted could see the balloons and champagne in the next room. But all of a sudden, one of the representatives mediating the contract came in abruptly.

“I’m sorry, we want 25 percent off your price,” he said.

Ted cast a look at his colleagues. With a nod to each other, they rose and gathered up their paperwork.

Testing the limits during international business negotiations

Ted turned to the rep. “Thank you very much, it’s been a pleasure doing business with you. We’re leaving tomorrow morning at 8 o’clock, if you want to discuss this further, that’s fine.”

Ted and his colleagues left.

An hour later, they got a frenzied phone call from the company retracting their statement; they wanted to sign the contract. Ted knew immediately what had happened; the Chinese businessmen had been testing him. They wanted to make sure that Ted wouldn’t sell for less than originally negotiated.

By refusing to budge, Ted had passed the test. Later, Ted’s team popped the bottle of champagne and all laughed about it.

It all started with a simple passion to work overseas

Ted Benson has over forty years of experience in international trade. He has learned through trial and error, time and again, the skills he needs to be successful in the industry.

In his spare time, he also marks course projects for the Forum for International Trade Training (FITT), and is helping compile an international business glossary for FITT.

 Participate in the International Competency Standards Project

After graduating with a degree in geology, Ted started his career as a pilot in the air force, and had the opportunity to do some international programs. Later on, he found his calling in negotiating contracts for the Canadian Commercial Corporation (CCC), on behalf of Canadian companies.

Ted’s passion for Asian culture, coupled with his contracting experience, earned him a spot as a Trade Commissioner for the Foreign Service in Beijing. From there, he did exchange postings in Shanghai, Bangkok and Hanoi before returning to Canada and the CCC years later.

It was then that he saw the shortage in global trade skills.

Because I mark exams, I have to be current on my skills and knowledge. I see skills that are lacking, and incorrect impressions from those who currently work in this industry.

Learning from a ‘not so friendly’ pricing strategy

He recalls a Canadian company he worked with that would typically use penetration pricing as a way to enter a new market. The company was headstrong and their product had value. However, their Chinese counterparts had an expression: ‘Friendship Pricing’.

The Chinese company insisted that because they had such a large market, the Canadian company could give them a really good deal and the size of the market would more than make up for the lower margins the Canadian company might receive. The Canadian company, eager to tap into such a large market, agreed.

But because the Canadian company had agreed to the low ‘friendship price’ once, when they returned to do business in the future, the Chinese company made it a rule to start at that fixed price, and wager down from there.

Needless to say, it didn’t end well, and the Canadian company earned little to no profit.

Ted has specialized in large-scale sales in Asia for years, and through all his experience he has developed the skills to avoid such massive mistakes.

Attention to detail and cultural competencies are vital to success

Some years ago, a colleague of Ted’s worked with a Canadian company that had signed a contract with another company based in Shanghai— but the goods were late getting to China.

This kind of mistake could cost a company thousands of dollars. The Canadian company’s one reprieve? The company in Shanghai had forgotten to put a Liquidated Damages clause in their contract.

The Shanghai company argued that even though it wasn’t written in the contract, the intent of their agreement was a penalty for late delivery of the goods. Therefore, the Canadian company would have to pay the fee.

The Canadian company firmly stated that they operated on the basis of what was in the contract. The Shanghai company, enraged, argued all the way to the airport.

Ultimately, the contents of the contract were legally binding.

The Canadian company had been lucky, but many companies would have had to pay penalty fees.

You have to know every aspect of drafting a contract. You have to know that 70 percent of letters of credit are invalid in most cases, and that for every day you’re late delivering your goods to the buyer, a Liquidated Damages fee could be charged. Educate yourself on these terms; develop those skills.

But it isn’t just sales and negotiating competencies that can make or break your global trade deals. Culture and language skills are also crucial to success in foreign markets.

Years ago, Ted was enjoying his breakfast in a hotel in Beijing, and his competitors were sitting nearby. They hadn’t recognized him, as he was new, and they were speaking openly about their strategy in Chinese.

Ted listened carefully, and then raced back to his team to relay all the information he had gleaned. He knew how important his language skills were, right then. He currently speaks Mandarin, French, Thai, Spanish and a social amount of Vietnamese.

Skills development is key to building a global business career

While working in Vancouver for the CCC, Ted took the FITTskills courses and found that the comprehensive international trade skills he developed were essential to his job. He then went on to teach the FITT courses in British Columbia, and eventually became a project marker.

Ted believes that in addition to taking international trade courses to hone the skills needed for global business, the job profiles being developed through FITT’s ICS project will also be necessary to ensure global trade professionals are fully equipped to do their jobs.

The ICS job profiles will identify which skills are needed to do the jobs core to international trade. This will enable practitioners to build on their existing skills through professional development, and it will ensure students are learning the skills they need to begin their global business careers with the tools to succeed.

There is an absolute demand for these competency profiles. You can’t play tennis unless you know how to hold the racket, right? You have to have the skills.

What does Ted think is ultimately the key to success in global business?

“Enthusiasm is so important,” he says. “You have to enjoy the multi-cultural experience, be persistent, determined and focused on the objective.”

Are you interested in participating in our International Competency Standards Project? Join international trade experts from all over the world. Come be a part of setting world-class industry standards and defining exactly what it takes to compete in international business!

I want to participate!

The post Why skills development is vital to the growth of your global trade career appeared first on Trade Ready.

Zeeshanali Fazal is an Underwriter and Advisor of Financial Guarantees at Export Development Canada (EDC) in Montreal, Quebec. He was born in Kinshasa in the Democratic Republic of Congo, where he spent his childhood. Zeeshanali moved to Pakistan in the early 1990s, and by the late 1990s he moved to Canada where he completed his high school, CEGEP and university education in finance.

Zeeshanali began at EDC in August of 2009 as an Underwriter in the Undergraduate Rotational Program with assignments to the Accounts Receivable Insurance, Contract Insurance and Bonding and Small Business Financing teams. In 2011, he transitioned into his current position.

His role as Underwriter and Advisor of Financial Guarantees is to work with Canadian exporters to assess and mitigate the financial and non-financial risks of their international trade transactions. He feels a duty to his clients to not only assess the best steps to help them grow in international markets, but also to advise them of the challenges and pitfalls involved in entering new global markets.

Zeeshanali began his journey to the CITP│FIBP designation through the FITTskills program. He says the program gave him the opportunity to see the complete picture of the complexities of international trade.

The FITTskills program is not just about learning through books and writing exams. In fact, it also gives us access to a network of respected individuals working through globalization and helping grow international trade, and a platform to seek help, share knowledge and ask for expert advice!

He says that from trade regulations to the cultural aspects of international trade and the various financial systems, FITT prepares candidates to think of the various risks and challenges. It also helps people mitigate the risk of loss and surprises.

Zeeshanali is passionate and committed to helping his client-companies enter foreign markets, and feels the designation increases his credibility.

The CITP|FIBP designation builds the fundamentals of international trade and gives me added confidence in my consulting role. When clients see the designation, they have increased faith in the discussions, and every word has more weight.

Zeeshanali is eager and enthusiastic about his global trade future, and feels like his designation acts as a reinforcement of his interest in his career in international trade.

“FITTskills and my designation have built a strong foundation of international trade concepts that will play a vital role as I help customers through various stages of contract negotiations, and structure contracts that are not only financially feasible but also take into account the various challenges of international trade.”

The post Zeeshanali Fazal, CITP│FIBP — Underwriter and Advisor of Financial Guarantees appeared first on Trade Ready.

However,  raw data alone are not sufficient to develop a company’s market knowledge. The data must be analyzed to give them meaning and then put in context to generate insights about the international business environment. This process of taking raw data and analyzing them strategically is called market intelligence.

What is market intelligence?

When companies develop market intelligence, they are seeking to take raw data (such as sales figures for soft drinks in international markets) and process them to develop knowledge. This processing involves filtering the information, ensuring its validity, selecting relevant parts and deducing some meaning from them. In other words, knowledge is data that have meaning.

Intelligence involves analyzing this knowledge to add context, to determine what might happen, to decide what the best course of action should be in light of the knowledge and to plan for future actions.

Market intelligence for international markets is generated from international trade research and personal experience. It includes tacit knowledge (personal knowledge that is not easily transferred) and explicit knowledge (knowledge that is easily communicated, such as information in directories or on websites). To develop intelligence about an international market, a company must have clear strategic objectives relating to international trade. These will determine the business decisions that must be made and therefore indicate the type of market intelligence required and the data needed to develop that type of intelligence.

Types of Market Intelligence

The type of market intelligence that a company needs to make decisions depends on the company’s specific circumstances and strategic objectives and the target market. However, there are general guidelines that a company interested in international trade opportunities should use. For each global market being considered, researchers should gather four classes of information:

• The factors shaping the political, legal and business environment: This information can be used to assess general conditions in a market and the risks associated with them.
• The market infrastructure: This information can be used to evaluate the difficulties and costs that will be associated with the physical distribution of a product or service.
• The forces affecting the market: This information includes market size, consumer trends and market dynamics and can give an idea of the potential for sales and profit.
• Product-specific or service-specific data: This information can be used to evaluate the suitability of the company’s product or service and to determine whether adaptations or positioning might be required.

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