If you own a company and are considering making it an international endeavor, Derek Miller has some words for you: Too late.
That's because, Miller asserts, all companies are affected by activities around the world.
It’s certainly the case for a farm owned by Miller’s family. When family members gather to talk, world events are at the forefront, Miller, the president and chief executive officer of World Trade Center Utah, said at last week’s Weber County International Business Forum.
“When we talk about this farm today, we talk about what’s happening in the Middle East, because what’s happening in the Middle East has a direct impact on the success of this farm. We talk about what’s happening in China, because what’s happening in China has a direct impact on the success of this farm. We talk about what’s happening in the world, because what’s happening in the world has a direct impact on the success of this farm,” he said.
{mprestriction ids="1,3"}“I’m telling you this because if this farm, in the middle of rural Idaho, is an international business — and it is — then your business is an international business. It is whether you think it is or not, it is whether you want it to be or not, it is whether you understand that it is or not. It is that way because this farm and your business are impacted by what happens around the world.”
Miller urged companies to expand their views and think about international opportunities. Seventy percent of the world’s purchasing power, 85 percent of its growth and 95 percent of its consumers are beyond the U.S. borders, he said. Utah currently has 3,544 companies that are exporting, with 85 percent being small businesses.
During a panel discussion at the forum, Joshua Aikens, chief marketing officer at iGlobal Stores, said many U.S. retailers that iGlobal works with have perhaps 75 percent to 80 percent of their online sales occurring domestically. IGlobal provides technology for international e-commerce.
“It’s not a major focus,” Aikens said of those clients’ international activities. “It’s not where they’re spending their marketing dollars and all of their time, but it’s also not something to be ignored.”
Many want to grow that international piece of the pie, he said.
“American retailers are trying to tool up to capture that demand because it’s going to grow and it’s going to go somewhere,” he said. “So there is increased interest and increased opportunity. … The growth in in e-commerce is eclipsing the growth in domestic e-commerce right now, and for the foreseeable future it will continue to grow at a great rate, offering a greater opportunity for U.S. retailers.”
For InstaFire, which sells fire-starter and fire-burning products, going international occurred when it sent products to an orphanage in the aftermath of an earthquake in Haiti. TCR Composites saw an opportunity for growth in Europe about 20 years ago. Scott Lindsay, TCR’s president and general manager, said the company “found international companies more receptive to new ideas, to change, to new technologies.” International activities now account for 65 percent of TCR’s business.
Panelists acknowledged that international expansion has some potential hazards, including regulations that vary from nation to nation and issues with getting paid.
“The biggest challenge I see is technology — the speed and the advancement of technology and marketplaces,” Aiken said. “I see people going out and becoming successful using the Amazon marketplace or using eBay or using their website and Amazon, and then having something else crop up that’s new, faster, better, shinier, more exciting, more accessible on a mobile phone, and the market changes. And the people that tooled up and grew up in one channel can’t anticipate the shift quickly enough to where it’s going to go,” he said.
Still, Aiken said, new exporters should not “overthink” things. If they’re selling items across a border, a partner like UPS, FedEx or DHL can charge the exporter for the duties and taxes incurred.
“So it’s not altogether that complex to start selling to someone across the borders,” he said. “There are a lot of complexities … but I think the ‘analysis paralysis’ is probably the worst thing that holds people back from getting started and starting to sell their products internationally.”
“I hate even think about where we were 20 years ago, had we not taken the steps to go international,” Lindsay said. “Fortunately, our particular business, the composites industry, sees about 15 to 20 percent growth a year, which is pretty remarkable. … But had we not gone overseas at a time when we found open minds interested in new technologies, new philosophies and looking at new product, we probably wouldn’t be where we are today, bottom-line.”{/mprestriction}
