By Sam Thacker
Doing business around the globe is the new normal. Being able to sell to the growing number of consumers in foreign markets is the primary reason why small businesses in the United States must ramp up their global initiatives.
Growing Global Growth
Consumption habits are constantly changing. When domestic demand decreases, being able to sell to foreign consumers whose markets are still strong is crucial. While the United States is the largest economy in the world by far, with a population of over 300 million, the U.S. represents a small percentage of the number of total consumers in the world.
Emerging markets represent growth opportunities for all types of businesses. Major corporations are investing heavily in building global brand recognition. Small businesses are realizing the benefits of making inroads into global markets as well.
Exchange rates provide economic reasons for doing business in foreign markets. For U.S. companies, when the dollar weakens against a foreign currency, goods made in this country become less expensive for consumers overseas. Alternatively, when the dollar strengthens against a foreign currency, goods made in this country become more expensive for consumers overseas.
When the United States borrows trillions from foreign investors to finance domestic consumption and keeps interest rates very low to stimulate economic activity, the dollar is pressured. When the dollar depreciates, foreign markets get a good deal from American companies and want to buy more of our goods.
Low Global Barriers
E-commerce and international payment gateways are widely available, meaning there are really no significant barriers to selling goods and services outside the country. Consider some advice from James C. Roberts III, an attorney who helps companies set up global business operations.
Roberts firm, Global Capital Law Group, faced similar challenges when he opened an office in Milan, Italy. Roberts has a few tips for companies seeking to expand their business into foreign markets. Roberts recommends having global appeal. Don't be American centric. Foreign consumers will be more accepting of your goods and services if they appeal to that region's preferences. Develop products that appeal to global consumers. When working with companies and individuals in foreign countries, adjust to that market's preferences and customs.
Roberts also thinks that a business should establish global banking and finance relationships. Work with global partners that understand the complexities of foreign markets and can get you established doing business.
Foreign trade can open up a world of possibilities for business owners. It has never been more important to have a global footprint. Growing global demand, trends in foreign exchange markets, and the increasing ease of doing business overseas are all reasons to consider selling goods and services in foreign markets.
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