CHAPTER 12
Utilizing Resources: Where to Find the Information and Connections You’ll Need

If you look within your own organization, you might find a strong finance team or a strong operations team. When you’re looking to grow, you wouldn’t turn your back on those strong teams within your own organization, so why would you turn your back on strong resources outside of your organization?

I don’t mean your financial resources when I talk about utilizing your resources, although these are very important. What I’m talking about here is knowing what resources are available to you for your own growth. For example, have you reached out to your city, state, and federal government offices? Have you reached out to the foreign government offices in the region or country? To an America, this may seem like a strange approach, but if you were Asian, your government would be your first call. In this chapter, I’ll be discussing a number of different resources available to you, what they can offer, when you should reach out to them, and how best to utilize their information and resources.

In the United States, we often think back to the story of someone making it on their own, putting the world on their shoulders, and carrying it forward. These are great stories, but they’re just that; they’re stories. More often than not, the story of someone doing this omits all the people that helped the person along the way. Mark Zuckerberg didn’t build Facebook on his own; Bill Gates didn’t create all of Microsoft on his own; nor did Steve Jobs create all of Apple on his own. Don’t mistake leadership for doing everything on your own. Make sure you know what resources are out there and utilize all the resources at your disposal.

The most common “ask” throughout is for introductions. Getting to know more and more people that have some connection to your market of interest is indispensable to your growth. With that said, here’s a list of several resources that are readily available as you look to grow into foreign markets.

City Governments

City governments (outside of a few major metropolitan areas such as New York City; Washington, D.C.; Los Angeles; San Francisco; and Chicago) tend to be more limited in their ability to assist with growth. Oftentimes, there’s an Economic Development Commission (EDC) or a local chamber of commerce within a city or metropolitan area that can be of some assistance, but beyond some peripheral relationships such as a sister city or trade partner, these EDCs usually have limited resources and don’t have the capacity that the state or federal government may have. Getting them to see beyond their current limited relationships may also be difficult. For example, going to your local EDC and asking for a banking relationship in Vietnam they may say no, as opposed to their saying we don’t, but the sister city may be able to provide further information or contacts. Oftentimes, there’s no strong bond between the cities and the limited introduction may go no further than that.

But often these are the organizations that care the most about their constituents and can, at the very least, make the introductions you need to organizations and people at the state and federal levels.

  • The key ask of city governments should be focused around introductions at the state and federal level, as well as any introductions to businesses currently operating in the market you’re considering.

State Governments

I’ve always enjoyed working with state governments on international opportunities. Full disclosure, the majority of my work has been with the State of Colorado. State governments and, more specifically, the Economic Development arms of the state governments, have a very distinct objective, which is to grow jobs within the state that, in turn, grows tax revenues (not a revelation, I know). For this reason, they can be an extremely useful resource as you explore foreign opportunities. Many states have foreign offices in different parts of Southeast Asia as well as sister states in many countries, which can yield relationships. Additionally, they frequently have area representatives within the state that can be a point of contact.

State governments regularly organize trade delegations, host foreign visitors (another great way to meet potential clients or initiate government relationships in new markets), and cohost educational activities about foreign markets.

  • The key ask of your state government should be if there are any delegations going to, or coming from, your area of interest, what events are being held around your area of interest, as well as for introductions.

Federal Government

The United States Commercial Services is a great resource for initial market research at a very low price. Most people do not know that U.S. Commercial Services exists, but they are the “trade promotion arm” of the U.S. Department of Commerce’s International Trade Administration (www.trade.gov). They operate out of embassies and consulates in over 100 U.S. cities and more than 75 countries around the world.

The U.S. Commercial Services offers several assistance packages, including trade counseling, business matchmaking, market intelligence, and business diplomacy. Their services, especially when dealing with foreign governments, can be critical, and you should engage them early on if you know foreign governments will be an obstacle. The U.S. Commercial Services also will help in developing trade finance and insurance strategies for your business to help protect your business interests.

The U.S. Commercial Services is a great piece to the puzzle, but it isn’t going to do everything for you. It works with companies across the United States, helping them engage in markets around the world; this work obviously keeps them very busy and doesn’t allow for long, drawn-out processes with a lot of handholding. You might think of this office as something like the IRS; they verify your taxes are correct; they don’t prepare the taxes for you (and if they do, you’re in a lot of trouble).

  • The key ask with the U.S. Commercial Services is for market intelligence and business introductions in the foreign market. This matchmaking can be great because, as I’ve said, of the notion in Asian countries of the value the government brings to a relationship.

Accounting Firms

Accounting firms are one of my two favorite resources for relationship building. Even if you work with a small local or regional firm in your area, they more than likely belong to a bigger network, such as DFK International (www.dfk.com). These larger networks allow your small or regional firm to garner knowledge that they may not have in-house, effectively giving them access to specialties that they don’t need in their everyday practice. One such benefit is their country access. Of course, if you’re a client of one of the Big 4 accounting firms (or some of the other large firms), these services are accessible in-house, which can be a true benefit.

I’m a firm believer that before you do anything major you should speak to your accounting firm and your law firm so that you can understand how changes will affect your organization. If you don’t know the implications of what you’re doing, you cannot make an informed decision and thus you may not make the best decision. For instance, if the Trans-Pacific Partnership1 passes, you may be much better off from a tax perspective to set up operations in Singapore, as opposed to Indonesia, despite a much higher wage rate in Singapore. Your accountant should be able to look at issues like this and walk you through the opportunities and the tax implications.

  • The key ask of accounting firms is for tax implications and introductions, either to their offices abroad or partnerships they may have in your market of interest.

Law Firms

Here comes the other person you should speak to before doing anything in your business—your lawyer. They should be able to give you credible information that can help you make informed decisions about your company’s growth. If you use one of the major international law firms, they can even provide potential relationships for you in your new endeavors.

I also find that law firms within your target country can be a great resource. Finding ways to use them for parts of your market entry, such as setting up your company in a new market, may allow you to gain access to their numerous clients. I’d also note that in-country representation tends to be much cheaper than enlisting an international firm, but you need to understand the tradeoffs for that cost savings. A small local firm may provide some great relationships, but do they understand all of the legal implications of what they’re doing on your behalf as it relates to your home market?

  • The key ask of your local legal counsel is to help you understand the legal implications of working abroad with your specific products or services, including which markets you can sell into. A good law firm will be able to make strong introductions to either their partners in foreign markets or friends that may have gone abroad.
  • The key ask of a foreign law firm in your new market, revolves around introductions for sales as well as the other business services you need to operate your business.

World Trade Center

Contrary to popular belief, there isn’t one “World Trade Center.” There are, in fact, 330 world trade centers around the world that can offer connections to almost any country and region. World trade centers tend to work in conjunction with their local governments and businesses and, thus, have a wide variety of information at their fingertips. For a minimal fee, you can have instant access to information about who in a particular U.S. state is exporting, where they’re exporting to, what regulations are in place there, connections to the local world trade center, and more. I also enjoy the many seminars and conferences they sponsor, attended by informative speakers and like-minded individuals, who can help expand your knowledge of an area.

  • The key ask of your world trade center is for information and research, as well as introductions to both like-minded individuals in your local market and the world trade center in the Asian market you’re interested in.

Foreign Trade Consultants

I may be biased, but I think growth consultants, especially those focused on foreign markets, are essential (at least the good ones are). Their ability to know the difference between a good local law firm or accounting firm and a bad one will not only save you thousands of dollars; it can save you immeasurable hours and frustration. The same can be said of their ability to know how to best utilize local and foreign governments, as well as the proper trade organizations. They can add immense value to the scope of your work.

The work they do not only helps you in building strategy; it also helps you in its execution, which I consider just as critical, if not more so. Having someone with experience in the market who can tell you when to stop and when to go, or how to adjust a product to meet market demands, is extremely important and can be the difference between success and failure.

However, it’s important to ensure the person you’re dealing with actually has the experience you need. Reviewing their past work, industries in which they’ve had experience, and other topics before hiring them is crucial, as there are a number of “consultants” out there that have minimal or no actual international experience and are capitalizing on Google searches and social media websites to get them clients.

  • The key ask of a foreign trade consultant is similar to what you’d ask if you were hiring this team in-house. They need to be able to deliver on your strategy, plans, and execution. Like everyone else, they need to have the relationships in place to provide opportunities in sales and marketing as well as providing for your supply chain, if that’s needed.

International PEO

It’s probable that you don’t know what a PEO is. A few years ago, neither did I. Simply put, a PEO is a professional employer organization, an outsourced hiring firm; they allow you to hire someone and keep them on their payroll instead of your own payroll, but the employee works directly for you instead of a consulting firm or a short-term hire arrangement. Internationally, they allow you to hire someone in-country (a local or an expatriate) who works for you prior to setting up operations. There are often time restrictions on how long you can use a PEO in a foreign country without setting up operations first. They afford you many luxuries including managing payroll, taxes, and human resources for your in-country people.

Sending over one or two current sales representatives (or hiring in market) to build your sales pipeline and letting that finance your in-country setup and growth can be a great initial step into a foreign country. International PEOs tend to operate in many countries and can help grow a sales team very quickly across many borders without significant upfront capital and setup times. Finding an international PEO in your home market allows you to work with someone locally who can manage the human resources in a foreign market.

  • The key ask of international PEOs revolves around speed and efficiency, as well as potential introductions to some of their other clients in the foreign markets you are interested in.

International Trade Councils

They go by several names: chambers of commerce, business councils, institutes, etc. There are some great ones and some lacking in quality. These organizations tend to charge little cost to join, but be careful about what you’re purchasing. I find their matchmaking services or conferences are great. I also really enjoy events where they bring in foreign dignitaries. Where you may run into an issue is when organizations (these are almost always nonprofits) try to push too many services on you and act like more than they are. Their passport services are very useful, but their market entry strategy services typically are a waste of time. To many of these groups, a market entry strategy is making a few introductions and accompanying you on a trip(s). This is important but not to be mistaken for a strategy.

  • The key ask of international trade councils is how frequently they hold events, who attends the events, and what introductions you might need in your foreign market.

Five Common Mistakes Businesses Make When Dealing with Trade Organizations

These groups listed below are great reference points and, when used appropriately, make life significantly easier when your business is going international. When dealing with some of these organizations, once someone gives you a lead, don’t stop there; ask, “Who else?” For instance, if you’re working with your lawyer or accountant on your growth strategy, ask them who else you should be talking to and working with to improve the process. This question often leads to more referrals to good, strong organizations, not just those that come out on top of a Google search.

1. Not Understanding What the Organization Can and can’t Do

There is a time and a place to reach out and use each of these organizations. But you can’t expect any one of them to do everything for you. The closest you might come to an all-inone solution is your foreign trade consultant, and even they will need your help and support. At the end of the day, every organization has its pitfalls, and it’s important to think of each of these as a supplement and not a solution. Even when I sell a Strategy, Plan, and Execution to someone, we supplement our own services with people from inside our client’s organization, perhaps an international PEO, international trade councils, governments, and others. Knowing what each of these organizations can and will do for you is necessary to finding solutions to your questions.

2. Not Knowing Which to Use and When to Use It

It seems obvious, right? When you need to hire someone in a foreign market, you reach out to an international PEO and hire someone through them. How about which government entity to reach out to? Is it the federal or state government?

Is it the foreign federal or local government? Your accountant or your lawyer? Perhaps it is both, or all of the above. Going with an “all of the above” approach for everything gets both expensive and time consuming. You must know who to speak to and when to speak with an agency in order to get the answers you need so you can move forward efficiently. This not only revolves around which organization, but, when time and efficiency are in play, you need to know which person in the organization is the right one to access. Reaching out to the “top dog” may work well most of the time, but if you reach out to the ambassador in an effort to get an answer from U.S. Commercial Services, you may wait a while to hear back while the message trickles down to the person who can answer your question.

3. Thinking Only about Your Own Market

As private one word in the United States, we typically don’t think of reaching out to our government; but in foreign markets, especially in Asia, people work with and through the government every day. By not utilizing the same resources available to other firms in the market, you’re actually placing yourself at a disadvantage. Make sure you think not only of how you’re accustomed to doing business; instead make sure you’re pairing that knowledge with how others in the market do business.

The best example of this occurred when I set up Gallagher & Associates in China. At the time, I knew three or four people in all of China. I started out by going to each of them and asking them to suggest a good lawyer and a good accountant. I walked into a very large HSBC bank branch and met with a random bank representative, set up my banking, and operated in this way for almost the entire setup period. Had I had the knowledge I have today, I would have known to utilize the U.S. Commercial Services, Chinese government relationships, and many others, which would have made my life exponentially easier.

4. Communicating Poorly with the Organization

We all make mistakes in the way we communicate with different people and organizations. This is no different. I can recall my own experience with the U.S. Commercial Services. When I first contacted them, I used their online resources to reach out to specific people in Shanghai and Beijing; I inquired about their Gold Key Services and wanted to learn more. I got absolutely no response and, for a while, thought nothing more about the organization. Then, through other contacts, I began to work with the U.S. Commercial Services in Denver. They were able to connect me in to foreign markets and assist me with the information and connections I needed. It wasn’t that the initial contact was intentionally ignored, but with so much work going on at any one time, the random email sometimes gets lost. You will need to find the best means of communicating with each organization or individual.

  • The takeaway: As a consultant, I love it when someone reaches out by email because I can do some quick research on them and set up a follow-up phone call for more in-depth discovery. The blind phone call is more difficult because I’m typically in the midst of several other things and have to run through the process of figuring out who I’m dealing with in real time. Obviously, with all that has been said about relationships, meeting people in person is best. But it’s also the most expensive and time-consuming manner of finding what you need to know and can be like “finding a needle in a haystack” at times.

5. Not Knowing These Organizations Exist

I think this is perhaps the biggest pitfall all businesses encounter. Think of my story about setting up Gallagher & Associates in China and my ignorance about what was out there to support me. I made my life so much harder because I didn’t utilize all the contacts available to me. Many of these groups would have been ecstatic to help me get us set up and operating in China, which would have saved time and money, and perhaps would have improved our operations. Additionally, at times I could have allowed my in-country team to focus more on work and less on running around searching for answers.

At the end of the day, the organizations listed above are there to help, typically for a fee, but still there to help. It’s wise to use the help that is available; it’ll make your life easier.

Notes

  1. 1   It is important to note that at this point in time the Trans-Pacific Partnership has been signed, but has not yet been implemented.
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