The post Sourcing from China vs. representing a Chinese brand: a market-entry playbook for distributors and agents appeared first on Trade Ready.

Getting to Global and the Forum for International Trade Training (FITT) partner to empower businesses to export with confidence through exclusive online training offerings from the acclaimed FITTskills program and CITP®|FIBP® certified industry experts.

Ottawa, ON –October 2, 2019 – Getting to Global, an initiative that connects exporters to global business resources, and FITT, the standards, certification and training body for international trade practitioners, have partnered to bring the acclaimed FITTskills training to the newly launched Export Connect platform. The new space will not only be a catalyst for entrepreneur access to global resources, but also to valuable tools, expert advice, and new business opportunities needed to expand overseas.

Patrick L. Perreault, Co-Founder of Getting to Global, said, “Export Connect is the variable that was missing from the equation. We went from being an educational platform on global strategy to a real toolbox for SMEs to connect them to the experts and resources they need to go global. “Export Connect is literally connecting the dots between government resources, service providers, industry experts and SMEs to facilitate their expansion into new global markets. We’re excited to count FITT as a partner as they bring world-class training content to Export Connect and give exporters access to their network of certified international trade professionals.”

“If businesses don’t have the know-how to go global, they’ll give their profits to someone else, ”

says Caroline Tompkins, President and CEO of FITT. “Regardless of how good the product is, without export capable people, success will be harder, riskier and more expensive than it needs to be. We’re excited to be expanding our support of entrepreneurs alongside key players within Export Connect.”

Getting to Global brings together industry experts, business leaders, and government officials to help your company go global for faster growth. Export Connect is the latest addition to Getting to Global’s set of tools, a game changer for small and medium enterprises, trade and investment promotion organizations, and trade experts alike. And with FITT as a partner, SMEs will have direct access to the most important network of certified international trade professionals.

About FITT
The Forum for International Trade Training (FITT) is the standards, certification and training body dedicated to providing international business training, resources and professional certification to individuals and businesses. Created by business for business, FITT’s international business training solutions are the standard of excellence for global trade professionals around the world.

About Getting to Global
Getting to Global brings together industry experts, business leaders, and government officials to help small and medium enterprises go global for faster growth. We rely on a strong network of partners to aggregate the resources and data SMEs need to enter the global online arena in an unprecedented and simplified way. And we are more than just a website. In addition to creating a profile on Export Connect, entrepreneurs and business owners of all kinds use our Duties and Taxes Calculator to avoid bad surprises when shipping internationally. Or they find our Market Accelerator and discover what markets await them to expand and start growing.

If you have any questions, please contact us at afleury@perimetre.co.

The post Getting to Global and FITT announce partnership to add online international business training and expertise to export-connect.org appeared first on Trade Ready.

Finding the right partners in a new market is a major challenge many companies experience, whether a start-up or a seasoned business. Despite the challenge, building relationships with partners and distributors, especially in new international markets, is one of the best ways to grow your business and ensure market entry success.

Why do you need partners or distributors?

Partnering with a business that already has a customer base in your target market allows you to gain immediate access to these customers without spending the time, effort or marketing budget to do it on your own.

As a bonus:

Your new partner or distributor will act as an advocate for your product that has already gained a level of  trust with the potential buyers of your product.

Think of it this way, when you go into your favorite department store to purchase something, you may not have heard of the brand of product you end up taking home, but you buy it because you have an established level of trust in the department store’s brand.  In this case the store, being the distributor for that product, was the reason that the product ended up in your shopping cart.

The more partners or distributors you have, the more likely it is you will be able to increase sales through exposure alone.  Makes sense, right?  So how do you find the right partners?

Here’s where to start

There are many ways to get set up a partnership or distributorship. A few of these methods are mentioned below, but before you start contacting companies have a target list and a plan.

Who do you want as a Partner or Distributor? Make a list of who you would like to work with.

Search online, but go beyond just using a search engine, explore trade directories and membership directories. 

These will be more tuned to the specific geographic region that interests you.  Making a targeted list of desirable potential partners and distributors is far more valuable than just a generic list from a Google search.  In this way, you will be able to get not only the company name, but contact information, and possibly know which of your competitors are already working with a given prospective partner.  Find companies that will complement what you are offering.

What’s your plan?

You should have a plan of attack.  How are you going to contact them?  What are you going to communicate to them?  Be very conscious of your message – what you think you are saying is often not what is being communicated.  Don’t expect much of a response if you spam them with messages like:

“Hi, I am contacting you to make an agreement for you to sell my product”

Instead, try:

“Hello [prospect name],  my name is [your name] from [your company name], I found your information on [name of trade directory or member directory]  and the reason I am contacting you is I want to set a time where we can discuss how we can work together to increase sales through a mutually beneficial co-op relationship.  I have some ideas that will help grow both of our businesses.”

This would be much better received.

To make it even better, once you send out your initial message, follow up with a telephone call within 48 hours – just long enough not to seem like you are chasing them, but they will still remember your message.

Crafting your offer

You have to make your offer enticing.  One of the most effective ways to do this is to offer terms on the sale of your product.

Asking them to pay for your product up front and then try to sell it can be a tough conversation.

If the conversation went more like:

“I would like to offer you 1000 units of our product, which sells for $1000 in most stores, at a reduced cost of $500. Plus, you will not need to pay for the goods for 60 days after you receive them. Would that give you the time to sell the products before you pay the invoice to us?”

Most companies would like that concept.

But Wait!  I cannot wait that long to get paid!

Yes, you can.

There are many commercial finance products that are available today that will allow you to sell your goods on credit terms to these good business customers, and then get up to 80% of your invoice value advanced to you within 24 hours of confirmed and accepted delivery of your product.  This way, you are not waiting at all to get paid.  Pretty Sweet, right?

Not all banks or commercial finance companies offer this type of trade finance as it is fairly specialized, but it is out there.  A quick search of “export finance companies” will give you a list of companies that specialize in the type of funding you would be looking for.

It is critical to remember that when you are looking for companies to partner with or to be distributors for your product they will be an extension of you, and you will be an extension of them.

Any good or bad that comes out of the relationship will be shared, so hedge your reputation risk by only working with companies that you can be reasonably assured will enhance your reputation, not be a liability to your brand.

Want to learn more about finding partners and distributors? Check out this video by Wade’s company IMM Financial

The post The best approach to finding and signing new partners and distributors appeared first on Trade Ready.

As members of this constantly growing international trade community, you’ve probably seen a lot of things happening at FITT over this past year.

We’re so grateful for your crucial role in making all of those things happen, because without you, none of it would have been possible.

It’s been exciting to see your passion and expertise shine through in so many ways, including our monthly #TradeElite Twitter chats, discussions of important trade issues on LinkedIn, Facebook, Twitter and TradeEliteClub, and as contributors on our TradeReady.ca blog.

In the spirit of reflection and celebration that the holiday season and New Year bring, we’d like to take this opportunity to give thanks for everything we’ve been able to achieve together in 2015, and give you a sneak peek of what we’re most excited about for the year ahead.

Jessica Thornhill – Coordinator, Products and Services:

One of the things I’m proudest of from the past year was the team effort that culminated with the successful launch of our new online course platform.

There are many new features and resources that will be helpful to those taking FITTskills online courses, and we’re excited to hear how our current students are enjoying the experience so far.

In the coming year I’m looking forward to working with the growing number of educational partners in countries all over the world.

We already have partners delivering our courses in Colombia, Malaysia, Romania and the UK, and recently offered a two-week training session in Indonesia.

I can’t wait to keep adding to that list in the future.

Ewan Roy – Content Marketing Specialist:

One of my favourite things from the past year has been our #TradeElite Twitter chats. It’s been a pleasure to help organize the chats and work with so many talented participants who are experts in their field.

It’s been amazing to see everything they have had to say on the various topics we’ve covered, from IP protection and freight forwarding, to market entry strategies and the TPP.

Next year, I’m looking forward to continuing to connect with our various CITP®|FIBP® designation holders to write Spotlight features of their careers and accomplishments for TradeReady.ca.

Seeing the many different ways import export professionals got started in the industry, and hearing the amazing things they’ve done during their careers, is always fun and a great way to help professionals celebrate earning their elite designation.

Caroline Tompkins – President and CEO:

We were thrilled that Global Affairs Canada (GAC) officially adopted FITTskills training as part of the career path for all Trade Commissioners in 2015, and then extended this to locally engaged staff.

This, combined with our continued long-standing strategic partnership with Export Development Canada (EDC) and our research project with Employment and Social Development Canada (ESDC), is representative of the importance the Canadian government places on building the capacity of international trade practitioners.

On a more personal note, I’ve also been very pleased with the excellent work of the entire FITT team, from our staff to our Board of Directors.

2016 will be a big year of planning for us, as we’re currently putting together plans to celebrate FITT’s 25th anniversary in 2017, and developing everything related to our strategic plan from 2017-2020.

We’ll also be focused on enhancing the awareness of the value that FITT’s CITP®|FIBP® designation holders bring to the international business community, and the importance of the designation for anyone working in import export as a whole.

Silvia Baptista – Manager, Products and Services:

Working with an increasing number of international clients has been one of the high points of 2015 for me.

The number of professionals with their elite CITP®|FIBP® designation in the U.S. and elsewhere around the world continues to rise, and we now have educational partners in four different continents.

Next year, launching our International Trade Competency Framework will be gratifying, as we feel it’s going to provide international business practitioners with a practical, relevant model to define all of the skills they need to succeed globally.

The implications for the project in education, hiring, business development, professional growth and a number of other areas are far reaching, and I’m looking forward to seeing how those develop.

Pamela Hyatt – Content Marketing Specialist:

Launching our new website, FITTforTrade.com, was a true highlight for all of us at FITT. It allowed us to bring the website into the future with a dynamic new design, easier navigation and new resources.

We hope you’ve all had the chance to discover the new look and features, and we’re always happy to hear feedback and suggestions.

In 2016, I’m looking forward to bringing even more exciting new people and content into FITT’s community through our blog, TradeReady.ca, as well as on social media at tradeeliteclub.com, and the monthly #TradeElite Twitter chats.

We’re working on some fun new ideas right now, and we’re always thrilled to collaborate with talented international trade professionals like yourselves.

If you’re interested in contributing an article or collaborating with us in any way, we want to hear from you!

Joan Desautels – Finance Manager:

I’m very pleased with the progress we’ve made on our technical integration project over the past year, with our new website and CRM, CMS and LMS systems, and with the energy and enthusiasm that our FITT team brings to the table.

In 2016, I am looking forward to all of the new opportunities and challenges that come with the continued growth and innovation of the FITT organization.

Connie Brigham – Coordinator, Products and Services:

It was wonderful to play an important role in organizing our International Competency Standards focus groups and validation sessions, as well as to personally attend the focus group in Vancouver, and validation session in Ottawa.

I got to meet several of our CITP®|FIBP®s, and many of those relationships are ongoing as we continue to collaborate with the Content Advisory Panel.

Being out in the field and understanding the details of what our international trade experts do, and how proud they are to contribute to the project was a great experience, as was witnessing the discussion and seeing the ideas unfold.

We’re very excited about the progress being made on the 7th edition of FITTskills over the next year.

Along with our new course platform, I think it’s going to create a fantastic client experience that’s very user-friendly and helpful for achieving career goals.

Alex Barankevych – Digital Marketing Specialist:

I’m a brand new member of the FITT team, taking on the role of Digital Marketing Specialist on December 7. I’m proud to have joined this company and am enjoying getting started in my new position.

I’ve got a lot of new ideas for FITT that I’m working on right now, and 2016 will give me the opportunity to start putting those into place and measure their success.

Creating more content geared towards answering the specific questions and needs for professionals in the import export industry is a major goal for the upcoming year. I’m looking forward to working together with the FITT team to provide content that will be helpful and practical in your everyday work.

Thank you for being an important member of the FITT community, and we wish you all the very best for a Happy Holiday and a prosperous New Year.

Cheers from all of us at FITT!

The post FITT’s launching into an exciting 2016, but first, let’s celebrate you! appeared first on Trade Ready.

For example, a strategic alliance with an international distributor might be sought to reduce transportation costs, or a joint venture with a local manufacturer might be used to enter a new market more rapidly.

Because of the expense and business risks of international trade, it is essential for companies to know whether their international business partners are providing the required benefits. In some cases, a partnership might actually cause more damage than it brings benefits.

Keep an eye on how your partners perform

To determine how successful their partnerships are, companies must be able to monitor and measure the performance of partners.

This is only possible if companies have a clear idea of the value the partner should be bringing to the partnership, which should have been specified during partnership negotiations.

For example, a company might have developed a partnership with a call center in a foreign market on the understanding that a specified number of customer calls would be handled every hour for a specified cost, or a partnership with a master franchisee might have required a set number of franchises to be set up in a target market within three years.

When establishing a partnership, companies must agree on what partners should achieve, define the performance criteria and develop a plan for measuring the criteria regularly.

Performance criteria can be qualitative or quantitative.

Crunching the numbers to quantify performance

Quantitative criteria are those indicators that involve measurements and numbers. Results for quantitative criteria can be shown numerically, for example by a graph showing levels of sales or time between deliveries.

Quantitative criteria for measuring partnership performance can include the following:

• Sales at established intervals
• Profits over time
• Reduction of marketing cycles over time
• Productivity increases or decreases over time
• Sales growth over time
• Percentage market share
• Returns on investment
• Levels of capital

Don’t forget the intangibles too

Qualitative criteria are also important to the assessment of a partnership. These criteria are ones that cannot be enumerated.

Measurement of qualitative criteria is often dependent on the opinion of the individual gathering the data because it relates to the quality or characteristics of something. Some examples of qualitative criteria include:

• Customer loyalty to a product
• A company’s strategic position
• A company’s relations with other businesses in a market
• The perceived level of product quality
• Product recognition

Set up a strong routine

When companies have agreed on criteria for monitoring a partner’s performance, they must establish a system for monitoring and measuring these criteria. This involves making a number of design decisions.

One of the most important decisions is the frequency of evaluation.

Because companies will be uncertain of how successful a partnership will be, new partnerships are usually assessed more frequently for the first few years, and then less often as time passes.

However, in times of rapidly changing circumstances, more regular evaluations might be instituted again.

Another important step is deciding who will perform the assessment. Evaluation might be carried out by a company manager, or it might require the participation of management teams representing the partners.

Special training might be required if staff are unfamiliar with evaluation procedures in complex organizations. For some criteria, such as financial figures or quality levels, outside companies might be needed to evaluate partner results.

The measurement design must also include a plan for communicating the results of assessments to key personnel. Measurement will be useless unless action can be taken based on the results.

What criteria are most important for you to assess with your business’s partnerships?

The post Ensure your international business partners perform up to your expectations appeared first on Trade Ready.

Big opportunities for exporters in Africa

There is no doubt that the continent of Africa is a land rich in opportunities for international businesses. With an abundance of natural resources, some of the world’s fastest growing economies, and booming demand for technological growth, it’s not hard to see why.

Yet it’s also plain why so many companies are hesitant to bring their business there. Africa is well-known for being as risky as it can be rewarding.

Corruption continues to be a rampant issue, on top of the risks associated with poverty and political instability. Yet, when New York Times Dealbook author Danny Hakim states that Africa is “a continent that foreign investors have long been wary of,” he then adds that “now that narrative is changing.”

What are the risks of doing business in Africa?

Anita Esslinger and Cara Dowling discuss the risks associated with doing business in Africa in their blog for Bryan Cave Attorneys as representative of markets “where corruption can be systemic and entrenched,” in part due to “dealing with governments or state owned or controlled entities, having regular contact with government officials, and depending on third parties.”

Exporters often come across a multitude of red flags spanning industries and African governments. But is that cause to abandon business development in Africa as impossible due to corporate ethics and anti-bribery regulation?

For companies of any size who are contemplating business investment in order to make major sales and earnings outside of traditional markets, Africa can look like an untapped treasure trove.

But business in Africa contains both tremendous upside and substantial risk.

Africa is very much a work in progress. We see signs, as demonstrated by the recent election in Nigeria, and calls for greater transparency throughout the continent. It’s clear that the citizenry is demanding more from its leaders, including greater access to education, goods and services, as well as work skills better suited to the demands of the growing global economy.

Western companies bring not only goods and services, they bring opportunity for local development. Thus, leaders are now left to choose between companies that want to “pay to play” which bring sub-standard product, versus those which bring long term opportunity but are not willing to “buy their way into the market.”

It looks like the awareness of those options among the local populous is causing a shift, even if we are not totally there yet.

Set the stage for business in Africa with thorough research

Sometimes the choice to invest needs to be carefully analyzed before committing resources, personnel or otherwise, to a country. Africa is in no way a homogeneous continent, and there are still some countries where corruption risk and opportunity are in plentiful supply.

I have seen this all too often, as business leaders who sit in their home-offices don’t understand the cultural and business nuances that distinguish one country from the next, not only in Africa, but on most continents.

Pay a visit to Africa, and one will quickly realize that Cairo, Lagos and Johannesburg might as well be on different continents. The cultural and societal differences could not be more pronounced. Treat them as “one continent, one market” and you are doomed to fail from the start.

Strengthen your business against corruption risks

Not every multinational has the financial resources to commit to the long term development needed to resist short term corrupt demands, as cash flows may dictate a faster return on investment.

Thus, when considering business strategy, organizations need to account for time lines, and realize the demands for bribes, especially small bribes, in the context of local procurement process, might abound.

To resist them, a long-term strategic plan, with incentives for front-line teams to match, need to be considered. If shorter return on investment is required, some parts of Africa should be avoided, so as not to be put in a position of greater risk once resources have been committed.

All too often multinationals commit resources in a country, and then start to see a proliferation of corrupt demands once a project is underway.

That has been my experience in many of these regions, and when that occurs, bribery becomes indexed to “not losing an existing gain” as opposed to winning a new opportunity.

How can you avoid this risk-reward scenario?

Get to know the market, through public reports and due diligence before putting your teams in harms way in such regions. The data is out there and quite accessible, so think about your appetite for long term return as opposed to short term gain, before committing and inserting a business team into such a country.

Be up front with local partners right from the start

So, with all of the risks especially third party exposure, is success possible? How can businesses remain compliant and successful when the requests for bribes are so ubiquitous?

Making the effort to engage with local companies as part of an effort to merge core values with local needs brings the opportunity for business development to each region. It gives businesses an opportunity to be up front about ethical business and messages, so there is no confusion once a project begins that bribery will not be a part of the process.

When local partners know that up front, there is less opportunity for risk later in the sales process.

Ok, so how?

Corruption thrives in an environment where there is a lack of manpower, skills, working systems and other serious governance challenges.

Indeed, in my experience, where I saw corruption (for the most part), I observed poorly trained procurement personnel who were tasked with executing procurement regulations that were deliberately confusing, include the requests for bribes into the procurement process.

Start by showing your commitment

Jonathan Berman, author of Success in Africa, points to companies like GE as examples who enjoyed success without compromising on their values. Jay Ireland, President and CEO, GE Africa, remarks,

“if you can be seen as a company engaged in the country’s long-term development, and explain the benefits you and your team bring to support that development, it shows real commitment. Most importantly, it shows that you’re here to stay.”

Sounds nice, but what does that mean in terms of business practice?

GE takes that process of engagement one step further by focusing their messaging not only on product benefits but on employment, economic development and building skills. And that goes beyond just its own workforce to benefit the national economy as a whole.

The takeaway is that participating in corruption just perpetuates it, but there is another way.

GE has found success in Africa by staying persistently and resiliently engaged in a way that, in the end, helps to create a better customer.

In Africa, partnerships mean collaboration

Perhaps Emerging Capital Partners (ECP) founder Tom Gibian best summarizes the potential of Africa,

You look at the numbers, you run through your analysis, and you simply conclude that Africa over time rewards honesty and punishes corruption.

And, as he adds, “maybe not in every single transaction, but over time.” Or, as Jeff Immelt, CEO of GE states: “If you want to be a good global company you have to know how to make money in a country for a country. If you don’t understand that, you’re never going to win.”

And your company doesn’t need to be as large as GE to play by the same rules.

Maybe we should look at his model of success and reflection that “Being in Africa doesn’t make us better in Africa. It makes us better everywhere.”

I think that statement is really worth elevating as it demonstrates that organizations can achieve business success in regions which have integrity issues by taking a long-term view of resource commitment, investment and return. When this occurs, not only is success well rewarded, it results in local development, power of example, and most importantly, sustainability.

Everyone in the organization, even those who are not part of the overseas team, can look with pride upon how strategy trumped corruption by a long-term business model and steady execution.

I have been in organizations where those pictures of front-line personnel shaking hands with local partners, in some of the least developed parts of the world, as frontier markets, hang proudly on the walls in the C-Suite.

Why not give it a try?

Would you consider doing business in Africa? If you have, what was the recipe for your success?

The post How to succeed in Africa by choosing partnership over corruption appeared first on Trade Ready.

To set the stage for an emerging markets deal, there is a lot of work that has to be done:

Understanding the market by analyzing data, arranging for focus groups and surveys, or working with an expert who understands industry dynamics. Assessing the regulatory climate and macroeconomic conditions. Defining a clear value proposition as well as a viable pricing strategy.

Even if all of these details are well-thought out and meticulously planned, signing a deal with the wrong partner can lead to spectacular failure.

Working with a partner translates to a loss of control, as all decision-making power is not housed under the same corporate structure. Incentives, however carefully aligned, can diverge, leading to friction and loss of profitability.

These issues arise in all business, but are dramatically exacerbated in the emerging markets environment, which is often defined by a weaker rule of law.

While the contract is the first and last step in maintaining a partner relationship in a developed nation, in the emerging markets context, the contract is just one piece of the puzzle. In this context, contracts should not be used as the sole point of compliance leverage, and very careful relationship management needs to be active, ongoing, and taken seriously.

Signing the deal with the right partner can lead to spectacular profits. The emerging markets partner has a lot to offer, including on-the-ground intelligence on the constantly shifting market, regulatory, and macroeconomic landscape of an emerging market.

They can leverage their local resources and relationships on your behalf, allowing you to maintain a leaner, more efficient operation at home.

So how can you find the right partner and make sure that the relationship functions profitably and smoothly?

1. Identify potential partners

Consider how your domestic networks translate into foreign networks – college alumni groups, World Trade Centers, Rotary Clubs, and various U.S. government resources are great places to start. Also consider engaging outside expertise that can bring their networks to your table- one of the main benefits of working with SH International is the access that we give our clients to our emerging markets’ networks.

Meet as many people as possible. For a recent deal we put together for one of our clients, we arranged for two weeks of meetings with various foreign companies. We came to our last meeting extremely frustrated, as we had not yet identified the right partner for our client. We were not even going to share this particular deal with the gentleman we met that day, since he was from a different industry.

However, at the last minute, we did, and he referred us to some connections of his. We ultimately inked the deal with this party that was not even on our initial radar.

2. Understand that face-time is critical

It is critical in emerging markets to meet people in person. It is entirely normal to see absolutely no interest or progress in any commercial transaction or relationship except when you are in the emerging market country itself.

As shared in our last FITT article, make sure to visit people with whom you have key business relationships in person at least once a year, and preferably more frequently. When your international trading partners have not seen you, they may start making business decisions without taking you into account. They may simply forget about you, or, more insidiously, figure that you will never find out about some of their decisions.

3. Conduct upfront due diligence on the partner

There are various services that can help you ensure that you know who you are doing business with, from services provided by the U.S. Commercial Service to private investigators. You can also ask the partner for references from clients, suppliers, or other third parties.

Finally, do not underestimate the power of a solid internet search. This due diligence is critical – you do not want to find out that you ended up doing business with a known thief, money launderer, or terrorist.

Your company may not recover from the reputation damage or associated liability.

4. Make compliance natural

While investing in top-notch local legal counsel will help mitigate the risk of unenforceability, it is critical to, as much as possible, provide the distributor with natural incentives to maintain compliance with the contract.

A simple, yet powerful strategy that we use on behalf of our clients is to build relationships slowly over time, and to consistently bring new value to the relationship.

For instance, we have promised to help the foreign partner with their own growth objectives in other countries where we have relationships. This reminds them that keeping the deal running smoothly can have benefits outside of the currently contracted relationship.

5. Look for early warning signs of trouble

We have seen great partnerships fail because the foreign partner has problems in their other business dealings that cripple their ability to effectively fulfill their contractual responsibilities. Some of the strongest early warning signals can be related to the foreign partner’s financial solvency.

Be aware of and monitor any such indications, such as increasing demands for more lenient payment terms.

Signing a contract is only the first step of a successful emerging markets deal. To ensure a functioning and profitable partnership, it is necessary to be active, dynamic, flexible and creative.

Emerging markets are constantly changing, so if you want to profit from the rise in emerging markets’ spending power, it is necessary to stay on your toes.

What’s your next step in finding or building successful emerging market partnerships?

The post 5 effective strategies for building successful emerging market partnerships appeared first on Trade Ready.

Northstar Trade Finance was founded in Canada in 1994, specifically to address the unique needs of Canadian SMEs and their international trading partners.

Outstanding strategic partnership model

Northstar first caught the US Ex-Im Bank’s attention several years ago with their strategic partnership model. Northstar works closely with many financial institutions and public sector partners, several of which are shareholders of Northstar.

They have also developed a series of alliances with world-class export credit and export insurance agencies, as operations expanded beyond Canada to the United States, United Kingdom, and continental Europe, among other markets.

The partnership approach, combined with the world-class technical competency of the Northstar team, led the US Ex-Im Bank, America’s export credit agency, to authorize them as a delegated lender.

That meant they were approved to make credit decisions and lending transactions on behalf of Ex-Im: a privileged role accorded to very few trusted organizations.

After several years as a Delegated Lender, their strong continuing efforts have been rewarded with this prestigious honor.

Scott Shepherd, CITP®|FIBP®, the President and CEO of Northstar, notes that “This recognition, by one of the top export credit and insurance organizations in the world, is a tremendous win for the Northstar Team.”

It’s an undeniable acknowledgment of the value and effectiveness of our partnership approach, as well as our single-minded focus on and commitment to SMEs pursuing opportunities in the global marketplace.

Addressing a crucial need for SMEs

International trade forms a significant portion of many nation’s GDPs, and SMEs are increasingly recognized as engines of growth, job creation and economic value. Yet access to trade financing to fund these activities has often been underappreciated or difficult to acquire.

More recently, the direct and critical link between trade success and access to financing – including traditional trade finance and emerging solutions in supply chain finance – has been recognized at the most senior levels of political leadership and by heads of key international institutions like the WTO and various multilateral development banks.

Many small and medium-sized enterprises pursuing opportunities in international markets, however, still have trouble accessing trade financing – including highly effective risk mitigation solutions – through traditional providers of trade and supply chain finance.

Northstar has therefore developed an effective business model aimed specifically at addressing the unique challenges and needs of SMEs in Canada and internationally.

Even as major financial institutions reduce their international exposures or exit lines of business like trade finance, Northstar is actively working to extend its footprint, both directly and through expansion of its international partnerships.

Shepherd, a long-time supporter of FITT and a CITP®|FIBP®, notes, “At Northstar, we have gathered a team of top-level credit, risk and international market experts.”

“In addition to developing and structuring effective financing solutions in support of trade, we are uniquely positioned to provide advice and support to SMEs operating in or aspiring to operate in international markets, from OECD economies to emerging markets.”

“Our network of partners and associates provides an additional resource-base upon which Northstar can draw to help enable SME trade activity.”

Providing excellence in trade finance with innovation and expertise

It is clear that no single bank, export credit agency, multilateral institution or other entity can meet all of the trade financing needs in Canada or internationally.

It is equally a reality that SMEs continue to experience disproportionate difficulty in obtaining adequate, affordable levels of financing – including trade financing – despite the increased rhetoric about the importance of this market segment.

In Canada, the clear directive of the federal government through the Global Markets Action Plan, to support SMEs in their pursuit of international opportunity, is consistent with similar priorities in many markets around the world.

The reality, however, is that 80-90% of trade activity is supported by some form of trade finance, yet SMEs continue to experience difficulty in accessing trade finance, and the traditional providers of this form of financing are now increasingly challenged by credit and capital constraints and by limitations in capacity linked to increasing regulatory pressure.

As trading patterns evolve and exporters expand and diversify beyond traditional trading partners, the needs of SMEs for expert advice and well-structured financing will increase exponentially, as will the need for alternate sources and additional capacity.

Northstar, however, is nothing short of a world-class innovator in the financing of international commerce, benefitting from strategic alliances with organizations like FITT, numerous shareholder financial institutions, and various top-tier export credit and international institutions.

The award from US Ex-Im reflects the technical competency of the Northstar team: a key element of international business and trade.

Through more than two decades of evolution, building a network of effective partnerships, alliances and collaborations around the globe, they have been able to serve a crucial need for SMEs at a time when access to effective and innovative trade financing is more important than ever.

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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!

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