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Global markets have been treading water for several weeks now
due to the uncertainty in Western economies and a general
slowdown in most emerging markets of the world. Europe and the
United States must come to terms with their debt and deficit
issues and start generating favorable growth dynamics in their
respective domestic markets. As consumer spending lags,
everyone is focusing on an export strategy to achieve their
various national objectives.
While governments and large industrial companies work to
increase exports, this ongoing strategy can also apply on the
grassroots level. From a funding perspective, you may need
small business loans to cover extra inventory, but for
working capital, unsecured loans work best to cover
short-term cash flow requirements. Small businesses can engage
in global commerce, but there are a number of basic issues that
must be addressed. Here is a brief list:
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Brand Presence:
Cyberspace knows no borders, but having a website does not
guarantee that foreign buyers will notice or want to do
business with you without some modifications. A simple brand
name that does not require confusing translation is a good
thing. A separate tab that explains your "rules" for
international shipments is helpful, and even more helpful if
translated into the languages for the markets you have
targeted. It is "OK" to be in English everywhere else, but
you can leave further translation efforts until later, after
revenue success occurs;
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Developed Countries First:
There is a lot of fraud in international commerce, much due to
underdeveloped address and postal systems. There are
websites
that can help with promotional activities and suggest where
fraud is more prevalent. Developed countries tend to have
educated consumers that feel comfortable buying over the
Internet. People around the world still want to buy
"American" for many reasons;
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Pricing Conventions:
Studies demonstrate that the more you address local market
conditions, the more favorably your offering will be received
in foreign markets. Language issues have been discussed
above, but pricing in local currency is another way to gain
appeal. There are merchant services that will accommodate
these conversions, but remember that in this case, you will be
assuming foreign exchange risk unless you continually change
prices or include some protection in your price markups.
Since the Dollar has weakened considerably over the years,
many consumers may actually like to see prices in Dollars
because they understand that currency buys more today;
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Payment Instructions:
Pricing is one thing, but receiving payment is an entirely
separate topic. The transaction value for a single shipment
will determine how you proceed. Shipments valued over a few
thousand dollars should be prepaid via a wire transfer. Do
not give credit across a border unless the customer is well
known and trusted. Smaller shipment values can be paid with
the PayPal payment service that facilitates cross-border
payments without the risk consequences of general credit
cards. Plastic fraud is much more prevalent on an
international basis. PayPal will also pay you in Dollars and
perform any conversions for you;
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Shipping Provider:
Select a major shipping country and utilize their extensive
global shipping network. Proof of delivery is mandatory,
tracking services add value, but import/export services will
take the hassle out of shipping overseas.
With over 96% of the world's consumers living outside of the
United States, it is easy to justify an attempt to sell to this
market. There are a number of key issues to consider, but there
are support services available for whatever strategy appeals to
you and your company.
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