Regardless of which entry option that you select, it is essential to proceed with any partner or contact in the new market with care, knowledge, tact and accuracy. Remember you have only one opportunity to make a good first impression, but many chances to destroy a good business relationship. The key to a good first impression is good communication, and we will focus our discussion on this issue now. The following are some tips on understanding foreign customers, and suggestions on how to develop and maintain this essential relationship.
It is a reality in the world of international trade, particularly so in rich, fully developed markets, that an overseas buyer is seldom short of contacts with good manufacturers that can offer the product they want at competitive prices. Buyers have little time or patience to deal with poor or ineffectual communication. They quickly lose interest in an exporter, no matter how competitive and attractive the product, if they are less than fully professional in maintaining good and businesslike communications and relations. They are, however, willing to pay a premium for product shipped from a reliable supplier. The companies that are able to gain their attention and, potentially, their business are those that best communicate, right from the start, what they have to offer in terms of their product, and a solid long-term relationship based on mutual respect and professionalism.
Let us now examine some key ways to ensure that your first impression (and the relationship you hope to follow it) is created in a competent and professional manner.
Samples/Presentation
When meeting a potential client be sure to have the best sample representation of your product line with you. Be very careful of even minor flaws in samples – a buyer will automatically assume that a company that can not manage quality control in their sample line will have a poor record in commercial shipments. Be fully familiar with all technical and manufacturing aspects of your product range. If you have an extensive collection accompanied by a presentation, ensure you have someone with you to work the mechanics of the presentation while you carry the discussion.
Pricing
Be clear and unambiguous about your initial price. Build in a reasonable profit, but do not start out negotiating. Later on, you may explore ways to reduce costs or improve value, but during the first meeting the buyer wants to know your competitiveness and will walk away if confused about your pricing. Prices should be in US dollars or the currency of the customer.
For certain items such as garments and some other consumer goods, you may wish to prepare up to three prices. The importer will probably want to know the manufacturing cost, the cost of materials (this can vary significantly and may also warrant different prices), and the cost of preparation of the product for retail sale.
Frequently the buyer will already have imported from your region and will know the available shipping services and costs, but you too must be familiar with this subject and be able to quote a price both at your port and at the preferred port of the customer. However, given that shipping costs vary according to quantities involved, you will not necessarily be expected to have these available at the first meeting. It is important to be able to talk knowledgeably and to respond with such information quickly.
Note: In the next section you will find a Quick Guide to Making a Business Offer Offer which can be used when you are following up more formally in terms of price, etc.
Follow-Up
If the meeting is going well, the buyer will probably ask you to provide additional information and possibly provide additional samples. Before you agree to these requests, ensure that you can do so in the specified time frame. If you anticipate delays for such reasons as locating new sources of supply for materials, explain your situation immediately. This will cause no difficulty at the time, but if this advice comes later it will be viewed as unprofessional and possibly an indicator of how you would manage future commercial orders. Remember, how you manage yourself during these first exchanges, is how you are being judged as a potential reputable supplier.
If you are called upon to make a visit to the market, be prepared in every way, including how to negotiate in a foreign environment. It is extremely important to understand the culture of your target market when negotiating sales. For example, here are a couple of very different cultures that require very different approaches:
Japan: Traditional, polite, consensus decision making.
Mexico: Traditional, family orientated, social aspects important, like to do business
with friends.
Canada and USA: Non traditional, value individual and personal achievement, impatient, “can do” mentality.
Europe: Different characteristics in individual countries such as France or Germany.
In order to succeed in any culture, the key is to approach it with respect, modesty and awareness. Here are some of the keys to dealing successfully in a foreign culture:
Be polite, formal or sociable as environment suggests
Be relaxed, friendly, non-confrontational. Smile!
Adjust pace to suit other party
Be patient. Build rapport and trust
Focus on buyer’s need first
Be enthusiastic (and knowledgeable) about your product or service
Ask questions – listen. Don’t interrupt. Questions help control
Understand the cultural differences, different negotiating practices
Be fluent in the negotiating language
Avoid piecemeal concessions: Go for package deal
When making initial offers, leave yourself room to manoeuvre
Have ability to respond quickly to offers
Persevere
Ongoing Communications
The importer will want to know who is going to manage the relationship on a day-to-day basis. It is preferable to have the person who will be directly involved, participate in the meeting. If this is not possible, introduce the name of the person(s) who will be handling the account and other relevant arrangements. Those persons should also be fluent in the language of the customer or an international business language. Where you must work in a language other than your own, buyers do not expect perfection but they do demand clarity and no misunderstandings.
If an agreement flows from the meetings, the follow-up communications should be smooth and timely. E-mail communication is becoming the norm, but telephone and fax continue to play an important role. The technical capacity of the Internet and telephone/fax is crucial. Ensure that you have the best possible equipment installed. Pay attention to the internal routing of phone calls, ensuring that it does not place your overseas caller struggling with an operator who has limited proficiency in their language of choice. Also if the local telecommunications system is less than perfect, your client should be fully briefed on the situation and advised on how best to communicate with you. For example, perhaps there are certain times of the day that are most suitable.
Single Corporate Identity
The importer will want to know who is going to manage the relationship on a day-to-day basis. It is preferable to have the person who will be directly involved, participate in the meeting. If this is not possible, introduce the name of the person(s) who will be handling the account and other relevant arrangements. Those persons should also be fluent in the language of the customer or an international business language. Where you must work in a language other than your own, buyers do not expect perfection but they do demand clarity and no misunderstandings.
Some buyers have a difficult time remembering names that are foreign sounding to them. You should clearly indicate your family name and the name you wish them to use in addressing you. Also ask the same of them. Some individuals choose to adopt a name that is more familiar to foreign buyers. Similarly some thought should be given to how complex your company name may sound to foreign ears. Anything that can be done of this nature to make the foreign buyer more comfortable is a low cost means to develop the relationship.
No surprises
Foreign customers do not like surprises. Last minute surprises are a near certain means to damage a relationship with a valued overseas customer. For most consumer goods, the commitment importers have made to retailers is for very specific products delivered at an agreed time. If they do not meet these obligations, their own reputations will suffer badly, and they stand to lose their own customers. Thus unless they can fully trust their overseas suppliers, they will not continue the relationship. It is extremely important to keep the relationship between your foreign client and their customers in mind and strive to meet your obligations in all respects and on all occasions.
It bears repeating that if for some reason it will be impossible to meet a deadline or other commitment, let the client know of the situation immediately. They will, in turn, be able to advise their customers and thus minimize the difficulty. For example, if one of your own suppliers lets you down on a delivery of an essential component for your production, immediate notification of this fact will not necessarily be welcome, but probably will be understood if this is a rare occurrence. If you delay and only advise of the situation at the time when shipment should have taken place, the buyer will lose confidence in you as a supplier.
First impressions go two ways. If you are not convinced, after the first meeting, that the company/person you met with has the potential to be a good business partner then do not continue the relationship. Remember that a few overseas buying connections managed very well will yield better returns than trying to keep more customers satisfied than you have the capacity to take care of in a satisfactory manner. Every client relationship requires time and money to maintain. Use your limited sales and marketing resources to your best advantage.
Finally, remember the friendship element of any relationship. However, when a foreign visitor arrives, remember they are probably short of sleep and in a different time zone. Respect this in your initial sincere wishes to be helpful and friendly. Yes, they too will wish to socialize and perhaps take some time for tourism and will appreciate any assistance and companionship you can provide. Culturally, there is little difference here. They will, however, appreciate a practical discussion on how the two of you can share any non-working time together. Respect their views and do not feel slighted if they wish to be left alone part of the time.
Above all, treat the relationship with a foreign client with respect, a good business approach and common sense. You should expect them to do the same.
