Tara Kelly is a self-described “serial innovator” with a passion for using technology to help people—and with a little assistance from a program to help Canadian exporters, she hopes her software will change lives around the world.

Kelly is president and CEO of SPLICE Software, an Alberta-based company that also has offices in Chicago and Toronto. SPLICE is an artificial intelligence (AI)-based software suite with the ability to deliver personalized messages via multiple channels, including phone, short message service (SMS) messaging, and speech-to-speech technologies like Alexa and Google Home.

Growing with the help of CanExport

SPLICE Software has seen an impressive amount of success since its inception in 2006, and Kelly credits the Canadian Trade Commissioner Service (TCS)—part of Global Affairs Canada (GAC)—with being tremendously supportive and helpful in identifying opportunities to help her achieve success outside of Canada. Kelly networks through the TCS’s Business Women in Trade (BWIT) group. She says GAC’s CanExport program is a particularly valuable tool for Canadian companies looking to do business abroad. Her company received funding from the CanExport program in 2017.

CanExport is a five-year, $50-million program providing direct financial assistance to small and medium-sized enterprises (SMEs) seeking to develop new export opportunities and markets, especially high-growth emerging markets. The CanExport program reimburses up to 50 percent of eligible expenses to participating companies, contributing up to $99,999 in matched funding.

“If you know you’re getting 50 percent back, that helps a lot,” Kelly says, adding she found out about the CanExport program from a Canadian trade commissioner in Los Angeles, CA. “It’s nice that they are supportive of the commercialization, not just the development of the technology.”

Finding opportunities to expand internationally

In order to become a global leader in the industry, SPLICE must compete with other businesses from known technology hubs around the world, including California and Eastern Asia. GAC—through its CanExport program and its network of trade commissioners around the world—has been extremely helpful in her efforts to find more opportunities to expand SPLICE in the international market, Kelly says.

One of the first things the government does a really great job of, is just creating a network of colleagues and peers that are doing business abroad. The matchmaking services that they offer are pretty sophisticated.The CanExport program is really awesome if you’re looking at expanding into a new country that you haven’t done business with in a significant way.

Kelly previously worked in health services, creating reminders for doctors and health practitioners, where she found that such highly personal relationships should require highly personalized reminder services.

“Any organization that’s committed to a strong brand relationship with their customer really should be using a more personalized approach,” she says. SPLICE Software specializes in insurance, finance, and retail, focusing on large enterprise with the goal to humanize the digital experience.

One of SPLICE Software’s advantages, Kelly says, “is the data security of our platform and the ability to offer customers access to the right information at the right time without putting their private information at risk.”

Harnessing the power of AI technology

AI technology is rapidly becoming a regular part of everyday life. It is becoming more normal to be able to speak to your car, your refrigerator, your dishwasher, and other household appliances and have them speak back to you. SPLICE is on the forefront of this new technological movement, she says.

“We’re unbelievably excited about what the future holds,” Kelly says. While some people may worry about potentially negative impacts of AI technology, she is confident that computers will only be as smart as humans train them to be.

“I think that artificial intelligence is going to require human assistance for a significant period of time,” Kelly says, adding she believes AI technology is very valuable in healthcare and in many other fields, “as long as there’s a human factor present.” Society need not fear AI technology, but rather should embrace it, she says.

The post How a tech business is growing and going global with help from CanExport appeared first on Trade Ready.

The fastest growing type of exports is services. Although it makes up a smaller share of cross border trade, the current growth rate of international trade in services exceeds that of trade in goods.

A service export is any service provided by a resident in one country to people or companies from another.

Many companies are already exporting services without realizing it. Some types of services that are exported from the North America every week:

• Know-how supplied to a foreign franchisee (think of McDonald’s providing its operating template to a franchise in China)
• Architects and engineers designing a project in Asia (even if they never physically leave their offices in North America)
• A team of consultants traveling to a foreign destination to assist with an installation or trouble-shooting equipment
• Call center support provided to users from outside the country
• Tax advisors in North America providing advice to foreign companies
• Internet & Cloud-Based Software Cloud service providers whose platform is used by companies based outside their home country

4 types of service exports

1. Cross border trade: The service itself crosses the border, e.g. online delivery of website design, architectural drawings, translation
2. Consumption abroad: The consumer travels to consume the service, e.g. tourism, foreign student, medical tourism
3. Commercial presence: The service provider establishes a presence in the target market, e.g. setting up an office, an affiliate, subsidiary or representative in the market
4. Presence of natural persons: The service provider travels to deliver the service, e.g. trainer, consultant, performer

Introducing your service into a new market

If you are exporting services, you may wonder if there is anything you need to worry about. Some of the challenges associated with service exports include export compliance, VAT and income tax, work visas and immigration, tariffs and duties, and data privacy considerations. Whether these issues will be a major concern or not depends on the service you’re exporting and how you provide it.

Bringing a new service to a foreign market can be challenging. For smaller or new service providers that are inexperienced in new international markets, they may need to make significant investments in market research and marketing plans.

If the target market has different regulations, legal systems, cultures or ways of conducting business, these conditions will be challenging for an organization that is inexperienced in global trade. Service providers must check the regulations for business operation in the target country:

• Domestic regulations, e.g. labour standards, business regulations, finance and banking regulations
• Export requirements or a schedule of commitment limitations, e.g. ownership and entry restrictions

Businesses need to ensure that the type of service, the technologies being used and the mode of delivery are not restricted and are compliant with domestic laws and regulations. Anyone providing services–including third-party technology providers–must have the standards, qualifications and any licences required to operate within the target market.

Want to learn more about how to make your services more useful, usable and desirable for clients? Check out the FITTskills Service Development online workshop!

Use these strategies to minimize the risk:

• Research laws and regulations, scheduled commitments, dispute resolution mechanisms and unwritten business practices in potential markets, especially regarding customer rights and intellectual property protection in target markets
• Research domestic laws and regulations to determine potential liability of providing services in other countries, e.g. restrictions in exporting technology and data offshore
• Research processes and costs of exporting services to target markets
• Consider financial safeguards such as insurance and performance bonds
• Negotiate detailed codes of conduct, acceptable practices, key performance indicators, and penalties and incentives as part of the contract

5 quick tips to export services

Use these 5 tips from Marie-Elaine Beaudoin, BDC’s expert on exporting services.

1. Understand your client

Do your research. Consider visiting the country where you hope to do business to get a full picture of your new target market.

You really need to learn about your client—understand how they think, what their needs are, their culture and how they do business.

Marie-Elaine Beaudoin

2. Adapt your product, sales and marketing material

Consider how you will communicate your unique value proposition to your target market. Your marketing and communications, including your website and brochures should be tailored to your new clients. Account for the need to translate materials and also take different time zones into account.

3. Watch out for visa issues

Doing business in a new international market may require travel. Make sure that you are adequately prepared, including making complete travel arrangements. You may need a temporary business visitor visa and perhaps other documentation as well. Every country has its own entry requirements. Consider checking with a lawyer who is familiar with the country you want to do business with.

4. Understand the tax implications

“Depending on which country you are selling your services in, you’ll sometimes pay taxes on your profits and sometimes pay a value-added tax (VAT), as is the case in the EU,” Beaudoin explains.

Consider checking with a finance expert to determine how exporting your services will affect your taxes.

5. Anticipate the risks

Before travelling to deliver services in another country, inform yourself about any potential risks before you go. You can find travel advisory information by consulting  Global Affairs Canada’s website. Don’t forget to check and see what is covered by your health insurance and look for further coverage if needed.

The post 5 tips to grow your business with service exports appeared first on Trade Ready.

Services are the fastest growing exports just about everywhere. According to the International Trade Centre (the joint agency of the World Trade Organization and the United Nations), they grew 27% worldwide between 2010 and 2014.

Who’s leading the way in service exports?

The U.S. exports more services than any other nation in the world, more than $700 billion in services each year.

Canada also exports around $90 billion in services annually, making North America the single largest region for service exports, after the EU which trades mostly within its own region.

The U.K. is the world’s second largest service exporter, and despite its much smaller economy, provides about $350 billion in services – about half as much as the entire U.S.

The U.S. exports many of its services to Canada and the U.K. Surprisingly, Canada doesn’t export a high volume of services to the U.S. The country’s largest services trading partner by far is the U.K., with France and China nearly tied for a distant second place.

Thirty-one percent of U.S. exports are services. Canada’s service exports were only about 21% of total exports, but the sector is staged for growth.

And while the U.S. is the largest services exporter, it accounted for only about 14% of the world’s services export market.

With the huge focus on the service economy in North America (an estimated 70% of U.S. GDP is service-related), these numbers show that both countries are missing huge opportunities to increase their service exports.

What types of services are exported from North America?

The number one service that both Canada and the U.S. export is travel.

Around 25% of the services exported from the U.S. and 19% from Canada are travel-related.

Second for the U.S. (but much smaller for Canada) are royalties and other intellectual property payments.

This would include payments to foreign companies for the use of intellectual property based outside the U.S.

Some of this may be franchise fees (think Christian Dior), but a large proportion is actually intercompany royalties paid by a U.S. operating company to a foreign subsidiary where the company’s intellectual property has been parked.

Transportation-related services are a huge and growing part of service exports from North America, making up close to 13% of the U.S.’ service exports and 14% of Canada’s.

This speaks to the fact that many North American goods are exported and require transport to their ultimate destination.

Other types of services that both the U.S. and Canada export frequently include: financial services, telecommunications services, and a giant catch-all category of “other business services.”

All of these numbers should be considered directional only because of the huge measurement problems related to services.

Not all countries report their services the same way, and there are many, many types of services that are currently not captured – an issue we’ll delve into in a future article.

3 current megatrends leading service export growth into the future

The growth of service exports worldwide is forecasted to continue, and will likely outpace product exports.

Some of the identifiable trends that will contribute to the growth of service exports include:

1. Growing innovation and integration of technology incorporated into physical products.

Automobiles; they were never simple products, but are now chock-full of electronics that a simple car mechanic can no longer diagnose or repair.

Home appliances; exporters of these products must now think about how all of the electronic components can be diagnosed and repaired.

In some cases, this results in the need for additional training for local distributors (one type of service export).

In other cases, it may necessitate training and contracting separate local or regional service providers, or even having company repair experts hop on planes (creating more service exports).

Cloud-based services; the cloud is making it ever-easier to provide the sharing of music, ideas, designs, and data of all kinds virtually across borders.

Services will be provided as software incorporated into Bluetooth technologies, wearables, robotics, and the Internet of Things. Self-driving cars and 3-D printing over long distances will be possible because of the cloud.

Interestingly, the printed item is a product, although whether it actually is deemed an export or not will be open to interpretation and debate, but the technology that makes it possible will be cloud-based software services.

The real issue here isn’t the explosion of services, but whether or not laws and regulations (about such things as data privacy and data security, licensing of encrypted technology, and export and import controls) can be passed to keep up.

For example, if there is a data breach, from what country are the cloud services even provided?

Without these laws, one could argue that national boundaries are becoming increasingly irrelevant, which will be an advantage to service providers in emerging economies.

Another aspect of this trend is the shift from services that have a linguistic component to those that are purely data or algorithmic.

In the past, it is not surprising that a large volume of services trade occurred among the U.S., Canada, and the U.K. – all three share a common language and a common legal system.

These elements are important when the service requires person-to-person communication, such as troubleshooting computers remotely, arranging travel and financial transactions, and designing buildings and golf courses.

However, the shift to cloud-based data transmission will make these aspects of technology-driven services that are important on the front-end design to be less important for the delivery, which will occur in data packets.

2. Continued rapid growth of global e-commerce

Online purchasing is booming worldwide, with more and more people able to access and purchase items from anywhere.

This is resulting in an increase in distribution service exports tasked with moving e-commerce goods across borders. It is also a key reason distribution-related service exports are growing rapidly.

3. Enormous demographic changes

The middle classes in many emerging markets are exploding. This will mean more disposable income for both products and services.

Studies consistently show that once basic living needs are met, middle class people everywhere will be purchasing music downloads online (a service export), surfing the internet (more service exports), and buying more things online (yes, the products may be traditional exports, but the applications facilitating buying and paying for these items will be service exports in many cases).

Similarly, these rapidly developing economies will require massive investments in infrastructure, leading to many architectural, engineering, and construction service opportunities.

It’s also been shown that emerging economies shift more quickly towards services than developed economies.

The post Why services are the fastest growing exports worldwide – and are about to gain momentum appeared first on Trade Ready.