But as Sean Emmond, CITP, EDC’s Chief Representative for Indonesia, explained during a recent FITTskills Live session, opportunity is only the starting point.

“I think Indonesia is a fascinating market. Maybe not an easy market, but one of those markets where, if you invest in it, you can certainly find considerable success.”

That distinction was central to the session. A promising market is not automatically the right market. Businesses need to look past the headline numbers and assess demand, competition, regulations, buyer dynamics, local partners, payment considerations and their own internal capacity before committing resources.

For companies considering Indonesia, Emmond’s message was clear: success depends on doing the work before entering the market.

Start by understanding the scale and complexity

One of the first points Emmond emphasized was the size of the country itself. Indonesia stretches about 5,000 kilometres from end to end, roughly the distance across a continent-sized market. It spans three time zones, includes thousands of islands and is home to hundreds of languages.

That scale matters for international businesses because Indonesia cannot be approached as a single, uniform market.

Java, where more than half of the population lives, includes sophisticated urban centres with modern infrastructure. Other regions may have different levels of development, logistics capacity, customer behaviour and business requirements.

For businesses assessing the market, this means research must go deeper than national level statistics. A company needs to know where, specifically, its product or service fits. Selling into Jakarta may require a different approach than serving customers in another region. Bali, for example, has its own characteristics as a tourism driven economy, while Sulawesi is known as a major mining destination.

The actionable takeaway: define the geographic market before defining the market entry strategy. “Indonesia” is too broad to be the whole answer.

Look for opportunity in areas of national investment

Emmond identified four broad areas where international companies are seeing significant opportunity in Indonesia: infrastructure, cleantech and renewables, protein and agri-food, and digital industries.

Infrastructure has been a major driver of the country’s growth, with ongoing investment in roads, ports, airports, rail and logistics. Clean technology and renewable energy are also important areas of focus, especially as Indonesia looks to reduce its reliance on coal-fired power generation and invest in solar, wind and geothermal energy.

Agri-food remains a strong area of opportunity for companies with the right products, expertise or technologies. Food security is a critical priority for the country, even though parts of Indonesia, including Java, are highly fertile.

Digital industries are another major opportunity. Indonesia’s geography has made digital infrastructure especially important, helping connect the country across islands and regions. Investments in connectivity, e-commerce infrastructure and data centres are creating openings for companies with relevant technology, services or expertise.

The key lesson is not simply to chase high growth sectors. Businesses should look for the intersection between market demand, government priorities and their own capabilities. If a company’s offer aligns with national priorities such as food security, energy security or human capital development, it may have a stronger case for market entry.

Understand who really drives demand

In Indonesia, understanding the buyer landscape is essential.

Emmond explained that government and government linked entities play a major role in the economy. He noted that more than 50% of the economy is controlled by government or government linked entities, which means government priorities can have a direct effect on demand for certain products and services.

For companies selling into sectors such as electricity, oil and gas, mining or aerospace, working with state owned enterprises is likely. These buyers operate differently from private sector customers and may be influenced by national policy priorities, public sector procurement processes and state asset management decisions.

Private conglomerates are also significant. Emmond described Indonesia as home to large, sophisticated and well-run conglomerates that make up a substantial portion of GDP.

Selling to these companies may involve a very different process than selling to a state-owned enterprise.

The practical takeaway is to map the full buying environment:

• Who is the direct customer?
• Who influences the decision?
• Is the opportunity tied to a government priority?
• Are you selling to a private conglomerate, a state-owned enterprise or another type of buyer?

These questions should be answered before serious time and money are invested.

Prepare for strong competition

Indonesia’s opportunity also attracts competitors.

Companies entering the market may face strong local firms as well as regional and global competitors. Emmond pointed to the presence of Korean, Japanese and Chinese companies, along with firms from Western Europe and the United States.

That makes differentiation essential. International businesses should be prepared to clearly communicate why their product, service, technology or expertise is relevant to the Indonesian buyer.

A general value proposition will not be enough in a competitive market with established players.

Businesses should ask themselves what problem they solve, why their solution is credible, how it compares with local and international alternatives, and what proof they can provide.

Assess regulatory and certification requirements early

Regulation, documentation and certification are another important part of market feasibility.

Emmond noted that there can be a significant regulatory burden in Indonesia. While trade agreements can create preferential tariff opportunities, companies still need to understand the extent to which certification, documentation or compliance requirements apply to their specific offering.

For food exporters, halal certification is one of the clearest examples. Emmond advised companies looking at food exports to make sure they have access to halal certification before going too far down the path.

The broader point applies across sectors.

Before entering any new market, businesses should identify the certifications, documentation, approvals, tariffs, payment considerations and compliance requirements that apply to their specific product or service.

These factors are not administrative details to handle later. They can affect cost, timing, pricing, market access and feasibility.

Choose local partners carefully

Local partners, distributors and representatives can be critical to success in Indonesia.

“You will need a local partner,” Emmond said, describing this as a key element of market entry.

The right partner can help a company understand local conditions, engage with buyers, navigate business culture and build credibility. The wrong partner can create delays, misalignment or missed opportunities.

Companies should evaluate potential partners based on both market knowledge and their ability to work effectively with foreign companies. A partner should understand the local business environment, but also be able to communicate clearly, represent the company’s interests and support long term growth.

This is not a decision to rush. Partner selection should be treated as a strategic step in the market entry process.

Invest in relationships and presence

One of Emmond’s strongest takeaways was the importance of showing up.

In Indonesia, as in many emerging markets, a physical presence matters. Frequent market visits can help companies test assumptions, build trust, meet buyers, understand local dynamics and develop stronger relationships with partners, regulators and customers.

Emmond shared a comment he once heard from an exporter:

“If you don’t know the names of your business partner’s kids, it’s very unlikely that you’ll find success in the Indonesian marketplace.”

The point is not that every business relationship must become personal. Rather, trust is built through time, familiarity and repeated engagement. Companies that expect quick results from a distance may struggle. Those that invest in relationships are better positioned to build traction.

Emmond also highlighted the role of memorandums of understanding in Indonesia. While MOUs may sometimes be viewed in other markets as symbolic, he explained that in Indonesia they can function as a “license to engage.” They signal that two organizations know each other and are beginning a business relationship.

Investigate before you invest

Indonesia offers meaningful opportunities for international businesses, especially in sectors aligned with infrastructure, clean energy, agri-food, digital connectivity and national development priorities. But it is also a complex market where success depends on preparation.

The strongest lesson from Emmond’s presentation was that market entry should be grounded in careful assessment.

Businesses need to look at demand, regional differences, buyer structures, competition, regulations, certification, partners, payment considerations, political risk and internal capacity.

A large market can be attractive. A growing market can be exciting. But the right market is the one where a business understands the opportunity, the risks and the work required to compete.

For companies considering Indonesia, the next step is not simply to ask whether the market has potential. It is to ask whether the opportunity is a true fit and whether the organization is ready to pursue it properly.

Learn from more global trade experts

FITTskills Live webinars are free opportunities to explore timely international trade topics with experienced professionals. Browse upcoming FITT events and register for the sessions that can help you keep building your trade knowledge.

The post Is Indonesia the right market for your business? Lessons on smarter market entry from Sean Emmond, CITP appeared first on Trade Ready.

“…companies that export make 121% more money, grow faster, last longer, are better connected within supply chains, are more resilient to economic downturns, and are more productive, competitive and innovative.” 

It’s no wonder then, that the majority of Fortune 500 entities operate locations in foreign countries, according to research by CapRelo.  

Coming from a broader perspective, there is no bigger pool of consumers than the global one. Take the USA, for instance.

“More than 95 percent of the world’s consumers are outside of the United States,” notes the US ITA (International Trade Administration). “Your competitors are increasing their global market share, and you can too.” 

The story is the same for businesses in all countries around the world too. Whether you’re looking to expand operations or simply want to export your products and services to an international locale, the world is a big oyster for you and your business to take advantage of.  

So, the bigger question on your mind should not be why should I be expanding my business to global markets? But, instead, how do I expand my business into global markets safely and successfully? 

The answers are out there, and they require diligent decision-making processes and strategies that have been tried and tested by the most successful companies around. There is no secret recipe to it all, you just have to do the right research, have the right partners, the right training and the right team. Keeping in mind that female-run businesses often face more hurdles when building their companies, it’s especially important to think about expansion with this type of due diligence in mind.  

With that said, here are 5 important steps that female leaders can take to take their businesses beyond domestic boundaries.

Create a Highly Trained International Business Team 

In business, people do not encourage ‘going it alone.’ Yes, there are stories of renegade disruptors straying from the pack and doing their own thing to much-lauded success, but the reality behind many of these solopreneurs and their companies is that they had excellent mentors, staff members and partners who helped them become the success stories that they are today.  

So, when it comes to business expansion, you need a team that understands how to:

• Research target markets effectively 
• Manage international finance and FX intricacies 
• Navigate the complex landscape of international shipping, logistics and transportation 
• Engage in appropriate cross-cultural marketing and sales 
• Adapt products and services to the many regulations in international markets 

This type of team can be comprised of many positions, depending on your company’s size, operational model and needs. Many international business consultants offer-up global trade experience for doing business in international regions, as do import-export consultants, trade compliance specialists, and procurement and purchasing experts—on a more granular level.  

Depending on the size and breadth of your team already, you may want to hire a specialist in a niche area, such as logistics, or you may need someone who can do it all, from researching the right global markets to executing the expansion strategy on a daily basis—like a seasoned international business consultant, developer or manager. 

Regardless of the position, what is exceptionally important for the success of your team is the amount of professional experience and training they have.

For example, many companies that are focused on international trade often look for the Certified International Trade Professional designation (CITP®|FIBP®*) when sourcing top talent.

That’s because CITPs have the knowledge and skills needed to provide services in all of the areas noted above (and more). This type of designation can be extremely beneficial as it provides your clients with added confidence that your team members understand the complexities involved in global expansion and, more importantly, know how to avoid common mistakes that untrained and inexperienced individuals so often make. Just as you need to do your due diligence for your business, your teams also need to be properly equipped to do the same in their areas of expertise. 

Execute a Thorough Feasibility Assessment 

If you are going to expand your business into new markets the right way, then you need to do the right type of research to see if the potential opportunities are viable for your business—both its current and future state. That means you need to:

• Assess your organizational readiness to take on international trade initiatives 
• Understand the best import or export opportunities for your business using the right types of data (such as macroeconomic data) 
• Perform cost-benefit analyses for all of your expansion activities  
• Understand how to mitigate the wealth of risks that can occur day by day in an ever-changing global economy 

These aren’t small tasks by any means, but that’s why adding the right professionals to your business is of utmost importance. They know how to do it all, so you don’t have to. 

Find the Right Partners 

When entering a new international market, partners can help establish effective marketing and distribution systems, region-specific market and consumer knowledge, and important government or regulatory connections that are necessary for successful expansion. However, there are many, many instances where not doing the right research and understanding your liabilities or partner’s liabilities can create disastrous situations for both parties. So, it’s important to understand what type of partnership you need first (distributor, agent, business association, business associate etc.), and then how to ensure you negotiate an agreement that will not only benefit your business but protect it during unexpected scenarios too.  

Establish Strong Female Support Networks  

Female leaders need other female leaders to thrive in today’s business environment. The WPO is just one of many organizations that understands the importance of this notion, creating a network of peer-to-peer support for women who seek advice, experience and resources from women who have succeeded at doing business or, in this specific case, international business. Not only do female support networks offer mentors, conferences, expert advice and opportunities that otherwise would be difficult for female-run businesses to attain on their own, but they also lift up female leadership and diversity initiatives on the whole—continuing an essential growth cycle for the women-led businesses of today and tomorrow. 

Dig for Initiatives, Resources and Funding Opportunities for Women  

At first glance, it can be daunting for women to find resources, financial assistance and business guidance when growing and expanding their businesses. But now, more than ever, the world is ripe with opportunities for women to take advantage of, especially in the form of diversity initiatives. For example, many government sectors in Canada, the US and Europe actively seek female-run companies for events, start-up and incubator programs, and supplier diversity programs.

Many large companies do too; in fact, 97% of Fortune 500 companies have supplier diversity programs, according to EDC.

It may take a bit of digging for the right help, but the investment in time is more than worth it. Better yet, if you have already established the right team and networks, you may not even have to look for these opportunities. People will bring them right to you. 

Going global shouldn’t be daunting. On the contrary, it is exciting and ripe with opportunities for large-scale success—especially if you have the right teams, partners, networks and resources at hand. Luckily, for those who are members of the WPO network, you’re already part of the way there. 

* Certified International Trade Professional (CITP) is trademarked for use within Canada. FITT International Business Professional (FIBP) is trademarked for use internationally. Both reflect the same FITT certified designation. 

The post How to Take Your Business Global – 5 Important Steps for Female Leaders appeared first on Trade Ready.

For years now, FITT has been taking to Twitter to engage in lively discussions with our global trade community every month. Always focused on practical advice and trade-related topics, these chats have been a goldmine of wisdom and a great opportunity to network with thought leaders. Thought leaders we like to call, the #TradeElite.

So, after a short hiatus in 2019, and by popular demand, the chats are back in 2020! In December, as part of our holiday #FITTmas celebrations, we asked what you wanted to talk about this year. Partnerships! Partnerships! Partnerships! was the answer. Do we need them? How do we find them? How do we know when a partnership is the right fit?

• When should a business consider making a strategic alliance in their target market?
• How can you assess a potential partnership?
• What are the benefits of a strategic alliance for a small business?
• Who can help you identify potential partners across borders?
• What are the red flags and risks of partnerships and how can they be mitigated?

We assembled a crack team of experts to answer these questions and more. Read on for their answers. Have more questions? Leave them in the comments below!

Moderator:

Marcela Mandeville, CITP (@MsBrightIdea) , CEO of @AWEbusiness (Alberta Women Entrepreneurs) based in Edmonton, AB

Panelists:

Audrey Ross, CITP (@TresAudrey) Logistics & Customs Specialist at Orchard International Inc., based in Toronto, ON
Sarah Barnes, CITP (@bevictoryus) Supply Chain Expert, Entrepreneur and Podcaster at @LetsTalkSChain, based in Mississauga, ON
Kseniya Stogniy, CITP (@Kstogs) Export Advisor at Export Development Canada, based in Ottawa, ON

When should a business consider making a strategic alliance in a target market?

A1 relationships are key in business today so including connections from your target market in your online community as soon as possible #TradeElite

— Sarah Barnes (@bevictoryus) February 20, 2020

A1. You may not know specifically what you need yet, so best to build a variety of relationships early so they are in place when you figure it out.
In gen every biz usually needs local legal, accounting, hr, translation, gov’t & marketing services #TradeElite

— audrey ross citp|fibp (@tresAudrey) February 20, 2020

A1 when there is benefit to both sides and it aligns with your strategic long term goals. Otherwise the alliance won’t last. #tradeelite

— Ontario in Deutschland (@OntarioGermany) February 20, 2020

A1 #TradeElite There are no set rules when wanting to form a partnership. If you have an opportunity to explore working with another business, take it! If you’re new to your target market, you can leverage your partner’s knowledge, network & resources in that market! https://t.co/mUA9ZLR9gs

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

How can you assess a potential partnership?

A2 #TradeElite To build on my A1, it is all about commitment. If you have similar goals, similar values that is good. Has your partner set aside resources to make it work? Do you have a workplan? Do you have milestones?

— Ontario in Deutschland (@OntarioGermany) February 20, 2020

A2 – #Communication is key to assess who they are as people, as a company and if your #values align. It may take a few conversations and even an in person meeting but keeping your eyes wide open moving into a new partnership is critical to #success #TradeElite

— Sarah Barnes (@bevictoryus) February 20, 2020

A2 #TradeElite Assess it based on how it aligns to what you’re trying to achieve – is this the best fit for me? Will it bring me closer to where I want to be? Do your due dil. on their reliability & reputation – is this someone you want to be associated with?

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

A2. Referrals or word of mouth. Ideally this will be an intro through shared connection or they are so good at what they do, they are standing out.
Assessment is lining up your values & being clear on expectations, desired outcome & goals.

#TradeElite

— audrey ross citp|fibp (@tresAudrey) February 20, 2020

What are the benefits of a strategic alliance for a small business?

A3 #tradeelite Local knowledge is one benefit; don’t reinvent the wheel if there is a partner who can help you. Plus they are present there every day.
Complementarity is another. If you do X and they do Y, you can do Y for them in your market and they can do X in theirs. Win-Win

— Ontario in Deutschland (@OntarioGermany) February 20, 2020

A3. Sharing.
They
can do some of the costlier (either $ or time) items that are local market specific.
be an extension of your resources.
ensure last mile / tailored customer service
may have access to more customers
help avoid local risk
#TradeElite

— audrey ross citp|fibp (@tresAudrey) February 20, 2020

A3 #TradeElite There are many – increased competitive advantage by leveraging each other’s expertise, access to new technologies or filling gaps in skill sets that your company may have, risk sharing, leveraging their network… the list goes on and on.. https://t.co/VIqCTURCmt

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

A3 As I always say “Collaboration is the future of business” so there are so many benefits from shared growth – networks, revenue, online community – a true partnership will always look at ways where it is a win/win scenario for everyone #TradeElite

— Sarah Barnes (@bevictoryus) February 20, 2020

Any suggestions on how a business could research reliability and reputation?

#TradeElite – word of mouth, talking to other companies who also have partnerships with the came company, credit checks! Also check out @ExportDevCanada‘s Company InSight tool – it can help you find reliable & trustworthy info about foreign companies. https://t.co/G9DatP5uf1

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

Who can help you identify potential partners across borders?

A4

This may tie in! Through the EDC (@ExportDevCanada) Business Connection Program, Canadian companies are introduced to leading global companies interested in working with Canadian expertise and innovation.https://t.co/o92ZTHEgmd #TradeElite #CDNbiz #Export

— Barry Y (@yrraByrraB) February 20, 2020

A4 #TradeElite Leverage industry associations! They often have access to lists of companies through their members directory who can become your potential partners in market. Check out tradeshows. And work with the @TCS_SDC https://t.co/yZXPTVYQVI

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

A4. Start with your home gov’t resources & then check other countries embassies. They have consular services along with Trade services.
Hubs are going to be in city capitals but a lot are accessible online (like twitter).#TradeElite

— audrey ross citp|fibp (@tresAudrey) February 20, 2020

A4. The #TradeElite on twitter.
Honestly, I’ve asked for help with UK warehouses, importing cosmetics to South Korea, where do I find this tariff schedule, why is getting a POD so hard and my twitter connections have never failed to deliver.
Huge resource.

— audrey ross citp|fibp (@tresAudrey) February 20, 2020

What are the red flags and risks of partnerships and how can they be mitigated?

A5 #TradeElite Along with the benefits, come the challenges… Choosing the wrong partner can negatively impact your reputation. Partners can bump heads on ideas & you could lose some control of decision making. Also, when making an agreement make sure you #GetItInWriting https://t.co/cLH6ilwa0Z

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

A5 read the fine print, I think the risks are almost the same with any partnership, globally tho be careful of the jurisdiction of any agreement. If there is an argument you may be flying across the globe to go to court, each time $$ #TradeElite

— Sarah Barnes (@bevictoryus) February 20, 2020

And above all else protect your IP!!! #tradeelite

— Ontario in Deutschland (@OntarioGermany) February 20, 2020

A5 #TradeElite Again, #DueDiligence is key!

— Kseniya Stogniy, CITP® (@KStogs) February 20, 2020

A5. if things go badly – they can go very badly.
The key is to hash out your break up at the beginning. Of course you will be together forevah… but for fun, work out who gets what & who pays what into your agreement UP FRONT. ESPECIALLY JURISDICTION. #TradeElite

— audrey ross citp|fibp (@tresAudrey) February 20, 2020

Read the rest of the chat and join future discussions by following the #TradeElite hashtag. And stay tuned for the next #TradeElite chat, coming up Thursday, March 12 at 2:00-3:00PM ET, and if you haven’t yet, join us on Twitter at @FITTNews.

The post Forming strategic alliances in your target market appeared first on Trade Ready.

Stewart Henderson has travelled across Africa many times as the chairman of the Eastern Africa Association, a non-lobbying group of 400-plus investors based in Nairobi, Kenya who share information about politics and economics.

Over the course of his extensive travels, he learned that the best way for entrepreneurs are enter the East African market is to begin in Kenya and then fan outward with their offering to other states. More significantly, he says, they need to identify a niche market.

The latter point may seem obvious. Yet in daunting sub-Saharan Africa where, quite bluntly, it’s a “hell of a big challenge” to do business, it’s sometimes overlooked amid the market entry excitement.  The product or service being promoted must be “wanted and needed.”

“People will come to Kenya and say, ‘Wow, there’s a big market for shoes here,’ because they see all the children without shoes,” he said in a phone interview. “The reason they don’t have shoes is because they can’t afford shoes; it’s not because there aren’t any shoes.”

In another scenario, he said, foreign companies surveying the East African region for viable business prospects may venture to Ethiopia and see a massive banking opportunity to resolve time-consuming letters of credit. “But the point is, Ethiopians don’t want foreign banks. Full stop,” Henderson noted.

A tricky market with huge promise

Many countries are forecasting little to no population growth for decades to come. In contrast, according to Leland Clegg, president of the Africa Business Portal:

Sub-Saharan Africa is the new Asia of this century.

He says that the region represents a “huge opportunity in growth in markets and labour supply.” Africa is predicted to boost its portion of the international workforce from 10 percent to 37 percent by 2100, according to an IMF report issued this year.

Moreover, the major East African economies have strong GDP projections which are “much higher than the rest of Africa and much higher than in the developed world,” Clegg said. East Africa has not been as negatively impacted as neighbouring countries by the decline of commodity prices, he pointed out. And overall, Africa’s exchange rates have made it appealing for North Americans to import African goods.

For Canadian companies, the region is certainly worth exploring. In 2015, Canadian two-way merchandise trade with East Africa was $401.9 million according to Ryan Ward, a senior trade commissioner (Eastern Africa) based at the High Commission of Canada in Kenya. He noted that the IMF declared three markets in East Africa are among the 10 fastest-growing economies in the world: Tanzania (fifth, 7.2 percent growth); Ethiopia (sixth, 7%); and Djibouti (ninth, 6.7%).

East Africa’s prospects are greatest in the energy, construction, IT and agricultural sectors, with opportunities varying by country, Clegg added. Although oil is not as abundant in East African states as in other resource-rich areas of the continent, current investments in renewable energy sources such as solar, hydro and clean energy variations such as natural gas are likely to grow dramatically.

On the technology side, Clegg said Kenya has led the way in a continent that basically skipped telecom lines and moved directly to mobile, adding that the country is “much more advanced in mobile banking than the U.S.”

East Africa also offers possibilities for food manufacturers – but not for all players in the agricultural industry, cautioned Henderson. He said maize and other types of big farming are impeded by the lack of suitable land, especially in Kenya which is comprised mainly of desert.

Henderson is also involved with an organization that makes high-end cooking oil from avocado pears and sells it to Europe. He said food companies linked to specialist, niche markets requiring the high-altitude weather of Kenya to grow their crops are best positioned. He further noted that macadamia nuts are a promising product in the country, which are often grown by contract farmers with high literacy rates, no tolerance of pesticides, and the ability to satisfy European standards.

Kenya is a hub for all of Eastern Africa

 Without a doubt, Henderson argued Kenya must be the starting point for companies formulating a market entry strategy to East Africa. He adds that “if it’s going to work, it will work here.” He suggested setting up operations in Mauritius for tax reasons, creating a head office in the Kenyan capital of Nairobi for administrative purposes, and from there assessing whether the product or service may be exported to nearby Tanzania, Uganda or Rwanda.

The allure of Kenya is based on high growth, first-world infrastructure, banking and auditing systems, and the capitalist leanings of its largest ethnic group.

The country’s physical infrastructure has improved dramatically, with new highways and road improvements, a planned railway line, better internet connectivity and rising power generation capacity, he explained.

He also noted that the cost of power is declining as wind generation and other renewable sources come online, and these developments have created big opportunities for foreign firms involved in geothermal energy – from “consulting engineering all the way to on-the-ground operating.”

In other East African countries, opinion is mixed on the possibilities versus the roadblocks. Although gold projects in Tanzania, for instance, are established and faring well, “gas is very much in its infancy, with speculation in oil as well,” said Henderson. In his view, the major challenge is that socialist Tanzania is struggling with how to exploit its gas reserves and “make proper money out of it.”

Uganda, too, has its share of problems, he said. President Yoweri Museveni, at the helm since 1986, has been in power for too long and he and his family are interfering in the oil and gas industry. The country is considering building a pipeline to Tanzania, but that will take years.

Yet Ward said he spends much of his time attending trade shows in East Africa and offering Canadian companies a sense of how countries like Rwanda and Ethiopia have grown over the past decades, and deserve more attention.

How to compete without falling into the corruption trap

Global firms navigating Sub-Saharan Africa also “must decide what level of corruption they’re prepared to tolerate,” Henderson suggests. If local players believe a new entrant will pay, “they then have ways of delaying things.”

Companies embarking on a new venture in East Africa should dispatch expats on the ground to manage operations in a way that reflects their corporate culture.

Further, he dismissed the “half-hearted idea” of using a facilitator to move goods: “People say, ‘I can get a container out of the port; I can get a facilitator to get it out for me. I don’t bribe anybody.’ Rubbish. The facilitator bribed somebody in the port.”

There are some new channels available to help manage the local uncertainty, though. The aim of the Africa Business Portal is to connect North American small and medium-sized businesses wishing to enter the African market.

The organization has 100 advisers on both continents “who are committed to play by the rules,” and provide them with “large-company resources,” said Clegg, whose initiative was launched in October 2015 after seven years in development. The experts include multinational executives, former ambassadors, NGO executives and educators, as well as service providers such as attorneys, accountants, logistics people, and specialists in energy and agriculture.

Moreover, Canadian companies may turn to the country’s Trade Commissioner Service for free access to expertise and networks, added Ward. “At the most basic level, our trade commissioners help clients understand their potential in a given market, connect them with qualified contacts in the right organizations, and provide support if clients run into problems,” he noted, adding that his team also organizes business missions and trade shows.

Once set up in East Africa, Henderson said North American firms will vie with the region’s traditional trading partners of India, Europe and the U.K. Yet “China is the one you’ve got to watch,” he warned, as the Asian country is investing in large infrastructure projects such as railway lines and bringing in their own people. “You’ll often find your competition will have no scruples on bribery and paying people better deals.”

Canada, however, has a different take on China. “Rather than looking at Chinese companies as competition, we are increasingly seeing them as potential partners,” said Ward. The bulk of Canadian companies are SMEs and lack the capacity to take on major infrastructure projects.

This is why they should seek out subcontracting opportunities with “select Chinese companies already active in the region,” he advised. On the energy infrastructure side, for example, a number of East African states are interested in building major pipelines to facilitate the movement of crude oil – an opportunity for Canadian companies impacted by the downturn of the domestic oil and gas industry, Ward noted.

In Ward’s experience, the greatest impediments to Canada’s trade with the region are an outdated perception of Africa and a reliance on traditional markets. “The growth numbers speak for themselves,” he said. “If Canadian companies don’t take advantage of the opportunities presented by these expanding economies, other countries will.”

The post Navigating on-the-ground complexity to benefit from East Africa’s greatest potential appeared first on Trade Ready.

Effective partnering depends on effective networking. This is especially true for small businesses.

Formal and informal business links are important ways of developing contacts, securing business information, initiating co-operative activities, gaining access to new sources of capital and obtaining technology.

Business associates with experience in the target country are especially valuable, as a company can often hear about a potential international business partner when discussing other matters with a business contact.

Initial exploratory meetings with potential partners often produce much better insight into market dynamics, segments and competitors, which means that early meetings with other market insiders are often an incredibly valuable source of information. Here are five different sources you can explore to find the best partner for your international business.

1. Governments

In most countries, companies can approach the government department responsible for trade for information and resources. Trade departments will offer advice on exporting and other market entry strategies and will have databases of trade, investment and technology counsellors abroad.

European Union: The Enterprise Europe Network (EEN) is the largest network in Europe providing trade expertise and services for companies.

U.S.: The U.S. Department of Commerce provides many services to U.S. companies. Information provided includes listings of trade events, market research information for countries worldwide, a China Business Information service, a Middle East and Asia Business Information service and a fee-based Platinum Key service.

Canada: Global Affairs Canada provides a range of services for Canadian and non-Canadian businesses.

India: The Indian government’s Department of Commerce offers a wide range of trade-promotion services and assistance for Indian companies wishing to trade internationally.

South Africa: The South African Department of Trade and Industry offers an Export Marketing and Investment Assistance (EMIA) program that covers costs of travel to foreign markets, attendance at trade shows and establishment of pavilions at local and international trade fairs.

The foregoing list is far from exhaustive, providing instead a view of the types of assistance and resources available in certain markets. In some countries, including the United States, the United Kingdom and Canada, the national export credit agencies (Export Development Canada, or EDC, is Canada’s agency) possess extensive expertise and resources related to international commerce, from country risk and analysis, to financing and risk mitigation solutions, among others.

Many jurisdictions also provide export or trade-related resources and assistance at the subnational level, even down to municipal or provincial/state jurisdictions that are increasingly engaged in trade-related activity, such as the Saskatchewan Trade & Export Partnership (STEP).

2. Foreign embassies and trade commissioners in foreign markets

Many countries have trade counsellors attached to their diplomatic posts overseas, including embassies, consulates and high commissions. Those same counselors may also be present in key markets in the home country, as is the case in Canada, to assist companies with local support prior to their engagement in international markets.

3. Business associations

Business associations include chambers of commerce, boards of trade, industry associations and bilateral business councils set up to develop trade with specific target countries. All of these associations can provide contacts and business information.

Chambers of commerce and industry associations in target countries are also good sources of information. In many countries, industry associations maintain industry statistics as well as membership lists.

Business advisors: Companies should consider using consultants and specialists, such as lawyers and accountants, to search for potential partners. Although this can add to the expenses of market entry, business advisors can use their experience to set up new networks rapidly and speed up the introduction of contacts.

For smaller companies that are new to international trade, such services can greatly decrease the time involved in establishing an effective partnership. Some venture companies with investments in a group of local firms might seek partnerships with companies that have invested in a complementary group of firms, as a means of helping their clients expand and develop.

Financial institutions: Banks, individual traders (brokers) and trading companies are all useful sources of information about a potential international business partner in a target market. A company’s bank has a vested interest in the company expanding its business successfully, and if a company’s bank has a branch in the target country, that branch will usually provide a broad range of local business information.

Commercial databases: There are a variety of commercial databases that provide business information, including contact information. There are also services that are more specifically geared to partnering. Some of the best places to start looking for commercial databases, especially if you live in a medium-size or large city, are the business section of a library or local business centres. Other organizations to contact for information on commercial databases are local chambers of commerce, boards of trade or university business department libraries.

The World Chambers Network provides many services for international companies. One of the most helpful is the official Chamber Directory. This has 12,000 entries representing 40 million Business members and is a network for establishing new business contacts and obtaining helpful market information. The directory can be browsed for validated business partners, public tenders and trade fairs.

4. Expos and trade shows

Companies can also use trade shows to connect with potential partners as well as determine the market potential for their goods and services. There are many different kinds of trade shows or fairs. World expositions (also known as expos or world fairs) are the most important and impressive. Expos are more cultural fairs than industrial trade shows, but there is always a strong commercial component. Each expo is held in a different city and aims to showcase the best of the hosting nation.

There are two types of expo: registered (previously known as universal) and recognized. Registered expos are the most extravagant of the expos, with pavilions built by the attendees. The next registered expo is to be held in Astana, Kazakhstan in 2017. Recognized expos are smaller in scope, with pavilions provided by the organizers. The last recognized expo was the 2015 international expo held in Milan, Italy.

5. Published studies and books

A variety of research institutions and government agencies conduct economic and market research and publish studies on their results. For example, GAC in Canada publishes a wide range of sector profiles and studies. These studies can be accessed online, sometimes for a fee, or can be ordered from a university library. The business section of a good bookstore contains books focused on specific markets, and often include sources of business information.

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In its report card, The Council of Councils, a global initiative to connect leading foreign policy institutes, has identified ten global challenges that every nation should consider in order to build a better world. These challenges range from mitigating climate change and combating transnational terrorism, to promoting global health and expanding global trade.

Although each of these ten challenges deserves special attention, expanding global trade is particularly important because it represents a unique opportunity to contribute to local wellbeing and economic development.

To date, there are 277 regional trade agreements (RTAs) registered with the World Trade Organization (WTO) which might seem like enough. However, there is still room for greater socioeconomic improvement by promoting and implementing more RTAs and other initiatives to facilitate and expand trade among nations.

Rohinton P. Medhora, President of the Center for International Governance Innovation (CIGI) in Canada, said that “Global trade is sputtering, but has not degenerated into damaging protectionism.”

Likewise, Jaime Zabludovsky, President of the Mexican Council on Foreign Relations, pointed out that expanding and liberalizing global trade are key elements “to provide better access to globally significant markets, diversify the investment relationships between states, and promote the growth of regional supply chains.”

Everyone can participate and benefit from global trade

Despite the benefits of international trade, there are misconceptions that promoting global commerce is against the principles of sovereignty, or that it is an activity accessible only to countries at an advanced stage of economic development.

However, international trade is an inclusive activity that allows any nation or business potentiates to expand its growth, regardless of economic size, and link its domestic economy to global opportunities. Promoting the effective use of global trade should be a priority, not only for governments or economic development agencies, but also for educational institutions and business associations.

We need to create more awareness about international trade in society as an essential component to achieving economic development and welfare locally. Countries resistant to promoting global trade are losing opportunities to boost their economies and businesses.

Thus, the challenge of expanding global trade should be embraced by everybody, keeping in mind that this is an activity that demands having a global vision, a lot of planning and strategic execution.

One of the most important recent RTAs is undoubtedly the Trans-Pacific Partnership (TPP), signed on February 4, 2016, by 12 Pacific Rim countries after seven years of negotiations.

According to the World Bank, the TPP is a mega-regional trade agreement (MRTA) with the potential to have such a significant impact on global trade that it will change the path that international trade has been following. In its final text, the TPP has upgraded and integrated issues and opportunities that had never been discussed before. The cutting-edge approach of the TPP addresses topics such as intellectual property, the environment, transparency and anti-corruption, small and medium enterprises (SMEs), government procurement, state-owned enterprises (SOEs), cooperation and capacity building, and e-commerce, among others.

To understand the relevance of having these themes integrated within the TPP, consider the data provided by the World Economic Forum (WEF) stating that “bringing the internet to the four billion people not currently online would add $6.7 trillion to the global economy and lift 500 million people out of poverty.” Thus, integrating rules for e-commerce within TPP nations has been a very important step of this new agreement.

As for traditional themes, the TPP has eliminated close to 18,000 tariffs on goods, ranging from agricultural to manufactured products. This will benefit both producers who might export their products to new markets, and consumers who will have access to a broader range of products.

The TPP brings new opportunities to bolster collaborative relationships

Some people believe that the TPP is just another RTA, or that it won´t add any value because several of those countries already had an existing trade relationship. However, even the closest trading partners in the TPP will benefit from expanded economic benefits, thanks to the depth of the agreement in different areas.

Particular attention has been given to the participation of NAFTA partners in the TPP: Canada, Mexico and United States. These three nations will not only be preserving their common interests through their participation in this new trade pact, but also increasing their trade relationship.

The TPP will allow them to strengthen their integration and collaboration to the benefit of several industries that share capacities such as aerospace, automotive, mining, agriculture, advanced technologies, financial services and more. The agreement will allow NAFTA partners to expand their markets and work together throughout the Asia-Pacific region.

According to the report “The Road to a Reinvigorated North American Partnership,” these three countries have the opportunity to increase their productivity. This productivity has been estimated to represent as much as $7.3 trillion USD to North America’s region.

To achieve this, they should solve common issues enabling them to compete together in international trade. These issues include harmonized cross-border standards for trucking, harmonizing regulations in a tripartite manner, improving rail, road, port and airport infrastructure, and solving migration issues.

Trade deals can help business, but you must make your own destiny

It’s important to underline that the TPP, or any current or future RTA, will not create these benefits by themselves. Every single nation and company needs to plan, research and “plant the seeds to harvest their crops.” The mistake that some have made in the past has been believing that RTAs will ensure success and that they just have to wait to reap the benefits.

RTAs set frameworks, rules and parameters, but it’s the responsibility of governments, businesses and stakeholders to prepare to compete in these new conditions. Sometimes people blame free trade agreements for their losses, but they don´t realize that the cause of their losses was their lack of planning and execution.

A key factor to succeed in international trade is building partnerships, in combination with finding new clients or purchasers. Partnerships are long term relationships where you and your partner can support each other in an infinite number of ways. The governments of Mexico, Canada and the United States have the opportunity to strengthen their partnership and growth capacities together within the TPP; I would suggest companies do the same for this new trade pact.

Finding partners abroad helps businesses overcome the main challenges that companies face in global trade such as product quality, customs, delivery, logistics, risk management, costs, foreign exchange fluctuations, and social, cultural and political issues. International trade practitioners must adapt their global thinking in terms of local actions. As an entrepreneur running my own international trade company and promoting partnerships, I can testify that free trade agreements offer tremendous advantages to compete and obtain positive results even if you are a small or medium enterprise.

Arriba Mexico Food Company and CMX Partnerships work hard every day to build bridges between Canadians and Mexicans in business making use of NAFTA and other initiatives.

Working with these companies, I have seen the power of bilateral collaboration when you build alliances with institutions from private and/or public sectors. These types of collaborations, often made possible by RTA’s, produce joint initiatives and can ultimately benefit society. International trade, supported with global partnerships, offer endless opportunities to promote economic growth.

The Council of Councils is positive about the global progress that international trade can achieve worldwide in 2016.They have ranked this challenge second in terms of opportunities for breakthrough because “the momentum of the TPP may propel progress for other regional and interregional trade.”

There are currently discussions happening about new agreements such as the Transatlantic Trade and Investment Partnership (TTIP), the Regional Comprehensive Economic Partnership (RCEP), and hundreds of other bilateral agreements between trade blocs and nations. These agreements can offer a promising future and the opportunity to create economic prosperity in regions and communities around the globe.

Promoting international trade as a tool to create wellbeing in society is the responsibility of all of us. Nations, provinces and companies should create their own strategies to participate and succeed in global markets. Finding your own niche and the right partnerships are fundamental in your strategies to participate in international trade. Finally, I recommend you consider the savvy words of Steve Jobs: “Think Big, Start Small and Move Fast.”

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In a recent conversation with a Canadian company wishing to expand internationally, I learned some of the questions that potential exporters face.

In this case, an expert in automation has two very successful automated tooling systems: one used in the automotive industry, and the other in the nuclear industry.

In both cases, he enjoys domestic success, differentiation and the support of his local customers to go abroad.

While he can successfully grow sales for both systems through exporting, he nonetheless faces an interesting dilemma.

This is because, while both products can be successful, the plans required for each product to do so must be very different from one another.

Choose the best path – single or multi-country approach

The automation tooling system for the nuclear industry has certain advantages that make it very attractive for export.

Firstly, the technical and regulatory requirements in the nuclear industry provide a huge barrier to entry, allowing for higher margins to fund global expansion.

A second advantage is that, as a niche industry, the potential number of competitors is limited when compared to other industries.

In this particular case, a single country approach may be more difficult to implement. Mexico, for instance, has only one nuclear power generation plant, and one research facility. The reactors in the existing nuclear plant are not of the same CANDU type used where the tool was originally designed.

A multi-country approach is therefore more suited to expand sales leading with this automation tool.

The export plan in such a case should look first into the usability of this tool in other types of reactors, as it will expand the potential for export. It should also look into the installed base of CANDU reactors in the world (South Korea, China, India, Argentina, Romania and Pakistan).

A proper market entry study must review in detail the economic effects of export regulations, tariffs and importing duties, issues that are non-existent when exporting to Mexico or countries that signed free trade agreements with Canada.

Go local with boots on the ground

Additionally, the variety of countries with potential customers requires different kinds of in-house resources.

A local approach, relying on the use of independent, on-the-ground sales representatives with established business networks in nuclear power plants, is the best way to enter the market.

In the case of the automotive industry, the automated system is used by car manufacturers in Canada. Aside from expanding into the U.S., this represents an opportunity in Mexico, where the automotive market is booming as more assembly plants are opening up, including a new Audi plant in the state of Puebla.

A recommended approach would be to complete a market entry plan to sell the automated tooling system to all the assemblers in Mexico, which would include some big names like Ford, GM, Nissan, VW, Honda, BMW, etc.

A further refinement would also show that all these plants are located in three distinctive zones of the country, allowing for a single country approach.

Due to the low number of potential customers and the high value of the tooling, it is better to sell either directly or through a local representative.

Understanding the tradition in the auto industry to drive costs low will be an important factor in determining the feasibility of one approach versus the other.

Make the extra effort to build trust with your local partners

Selling directly may also mean hiring a local sales or business development manager to work exclusively for the exporter.

Finding an independent representative is not easy; it requires building trust and that takes time. The representative usually carries other non-competing lines that dilute the sales efforts and the exporter has limited control on the sales function.

However, there is a low initial cost, and you gain immediate access to the professional network of the representative.

Recruiting a professional locally also has the advantage of complete control of the sales functions, 100% of the sales efforts and a better personality match between the exporter and the local manager.

It could furthermore include a lower sales commission if the compensation package includes a base with a higher upfront cost until the sales revenue increases.

In either case, new market expansion requires exhaustive market research, a good understanding of the cultural aspects of each market, and a refined export plan. An experienced international trade professional accredited by FITT is always a good start.

Have you ever marketed two similar products using very different strategies in separate markets?

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For example, you may find that somewhere within your existing customer base or through your online brand presence, you’ve already attracted interest from other countries, some of which are likely considered part of the emerging markets category. But have you ever really pursued these connections?

There is often an opportunity through a simple follow up with your existing connections to grow a rich dialogue that can lead to unique opportunities for conversation and collaboration.

So what, exactly, are emerging markets? As the name implies, these are countries where the economies are not yet front page news, but are slowly growing.

The multinational take on emerging markets

These markets are often seen as another form of competition, as global technologies and innovations enter the marketplace. Currently, typical examples of emerging markets include the BRIC countries – Brazil, Russia, India and China – already participating in global business at various levels.

In addition to products and services, these countries have emerging labor markets, something larger multi-nationals see as a resource to be tapped, along with an expanding middle class of new consumers, a customer base to be exploited.

How about changing that perspective? Big opportunities aren’t just for big businesses

But there is another way to look at the term “emerging market” and a different opportunity for the nimble small business owner. In my opinion, emerging markets defy easy explanation.

Rather, emerging markets, from the perspective of small or micro business, can be any foreign region with an untapped potential market segment.

For example, while the big cities in China regularly make headlines, there is a much larger segment of the population in rural China that has not had as much media attention – which one could consider a completely different “emerging market”. These “under the radar” segments of the population may very well house a viable labor market, able to support small business collaboration, and a unique opportunity to foster a new customer base.

This means that the potential for economic growth is just getting underway, and small businesses can create their own opportunity.

Your relationships are the key to emerging market success

Many emerging markets are occupied by small companies just beginning to expand their own entrepreneurial ventures and looking for meaningful ways to grow their business, identify new customers and connect with businesses from abroad.

This is where you come in. But why partner when your product or service is ready to compete?

The real question is: Why not?

Enter new markets by finding the right partners

First, in many smaller markets, customer loyalty to the understood local brand can be difficult to overcome. Finding a reputable retail outlet and distribution channels are another challenge in countries where the system may look quite different from what you are used to.

Why not look for more than just another potential customer base – why not look for unique ways to collaborate and create a business opportunity that can be mutually beneficial?

By aligning yourself with an existing or new business in another country, you can create a co-branded or cross-promotional opportunity that can get you customer recognition and more quickly establish credibility through the right associations.

Start with your existing contacts

One of the many examples of this technique being used successfully was promoting a family entertainment product abroad. With incoming interest from many countries, but a small staff, we followed up with the most promising and persistent inquiries; our contact in Trinidad being one great example.

When we looked into our contact in Trinidad, we discovered he not only owned a successful online store that was a perfect match for our product, but he was also interested in working with education – another arena our product had done well in. With his ability to meet directly with the Minister of Education, we were able to promote our product through Skype calls, emails and eventually, in-person visits. Our successful product launch overseas was as beneficial to our contact as it was to us and a lasting relationship was formed.

So, where to begin? You can start with the contacts you already have, via LinkedIn and other social media. Then assess like-minded individuals of similar interests and start a conversation.

There’s more than one way to grow your business – you may be surprised at how open small businesses in emerging markets are to hear from you, and you may just find a conversation turns into a unique collaboration.

Strong relationships will help outweigh the challenges

There are challenges to be weighed, without question – from political and legal environments, to banking institutions and credit-worthiness, identifying talent and maintaining quality control – but these need not be strict deterrents.

At the end of the day, any good global business venture starts with relationships and it is no different in emerging markets – in fact, one could argue, relationships are even more important in this realm.

A solid relationship with your emerging market contact can help you mitigate frustrations and give you an insider’s look at how business is done in their home country. With that in mind, allow yourself time. Relationships take time, as do the efforts of many entrepreneurial efforts.

If you are willing to invest in the time and effort, you may find it not only plays to your advantage, but it plays to the advantage of others as well.

Who are some of the contacts you have in emerging markets? How can you build those connections to discover potential partnership opportunities to break into emerging markets?

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