In the world of international trade, there’s simply no substitute for a business network. Here’s how a strong business network can work for you.
Cultural IQ and language:
Understanding business etiquette and the culture of the market you’d like to do business in is critical to success and it’s something many business leaders fail to adequately appreciate, says Omar Allam, CEO of Allam Advisory Group. Doing business overseas may be different from doing business in Canada for a variety of reasons. Your company may have the right product or service at the right price, but if you inadvertently offend your prospective customer or local partner by bringing up business too quickly, you lose credibility and risk future business.
It’s also important to understand that there are cultural differences within countries. Indian states are often compared to individual countries. For instance, the State of Kerala has a population that’s roughly the size of Canada's. Even in Canada, the corporate culture in New Brunswick is quite different from that of Toronto.
Partnerships can open doors:
In many countries, having a local partner is the key to success. It’s important to find partners who understand your prospective customers— including who has the decision-making authority and how they make those decisions.
Knowledge of international markets:
Members of your network will give you insights into doing business in the market. You want to understand the culture and how business is done. Nova Scotia’s Acadian Seaplants, a Nova Scotia-based company that sells a rare seaweed product, exports to 70 countries and has locally-engaged staff in 13 of those markets. When it was looking to enter Ireland through an acquisition, it had to be patient with its would-be sellers. “We are extremely flexible in dealing with new cultures. This may mean giving terms, extensive travel to that country and involve the use of our people resources,” said Senior Vice-President Kevin Hamm. “We are determined to bring value to every market we enter. We are not afraid to invest in partnerships.” In the case of the Ireland acquisition, the team developed good relationships with bureaucrats and politicians alike, but it took seven years to complete. As Hamm says: “We were patient and we played the long game.” In that sense, Ireland was very different from Latin America, where Acadian Seaplants also does business. “In Latin America, everything and everyone moves fast,” Hamm says.
Building trust overseas for business:
As a Canadian company, you automatically have the country’s brand as a reputable and reliable supplier. But it’s important to understand how best to align your own corporate culture to a new market.
Make sure your business network is diverse:
A diverse business network will help you navigate your way through the local market. It’s a good idea to come up with a strategy so you can leverage your network effectively by mapping out who you know and when to call on them. “A lot of companies just rush to the gate without understanding what their local networks can do for them,” Allam says.
Industry contacts are key:
Having connections in your sector will keep you apprised of global opportunities and offer chances to collaborate with companies that offer complementary services. You might even find a way to align with your competitors in cases where you can team up to offer more bandwidth or product. Industry associations will prove valuable, as will chambers of commerce and business councils. For example, if you want to do business in China, think about joining the Canada-China Business Council. Finally, sector experts at organizations such as the Canadian Trade Commissioner Service and EDC can also prove to be good sources of knowledge and information.
Social media provides opportunities:
Staying on top of a well-curated social media feed— think LinkedIn for example—will connect you to sources you never knew existed. If your feeds are effective, they can point you to the captains of your industry, as well as news about it.
Trade rules, regulations and compliance:
Newcomers may miss the nuances of anti-corruption and bribery. For example, any company that’s looking to do business in the U.S. has to understand and fully comply with the Corruption of Foreign Public Officials Act (CFPOA) and Foreign Corrupt Practices Act (FCPA). If you run into a gray area, it’s prudent to consult experts in that field. In addition, consider investing in training on bribery and corruption issues, including taking courses such as those offered by the Forum for International Trade Training.
Building new supply chains:
A network is a good gateway to supply chains you may not otherwise know about. Building relationships with the biggest players in your industry will get you access to those supply chains. If you’re in aerospace, for example, use your networks to get you meetings with the big three— Boeing, Airbus and Bombardier—and tell them why your airplane part is more reliable and cheaper than the one they’re using now.