Monday, May 23, 2011

Is US Exporting Climate Worse/Better Or About The Same

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OK, to the Question for this post:

Do you think the climate for US exporting is worse/better / substantively any different than when you wrote that blog answer Jan 2009? - Here is a link to that post:
Import Export Business And The Economy

The question was sent as a follow up to an email that asked: "Your best guess on how this could affect / not Exports from the US?" -
Specter of trade war looms as G-20 nations gather

My Answer To The Follow Up Question that is the subject of this post:

Every exporting business is different. Each deals with different products, each exports to different parts of the world. Each exporting situation has been affected differently.

1. I believe it is easier today to establish yourself as an export agent or broker or to get manufacturers to deal with you than it was two years ago because US manufacturing, what's left of it, is desperate, whereas before they were fat, dumb and happy and now they are competing with India, China, Brazil, Vietnam, you name it.

2. There is a car exporter who has advertised on our site for about 3 years now. I do not recall the exact numbers but when he first started advertising the Euro was about 1.60 to the dollar and he was exporting 20-40 vehicles a month (i believe that was the number) at a markup of $1000 per vehicle or a pro-rated basis if they purchased 5 or more down to $500 a vehicle.

In February of 2009 he called me to renew his ad and asked me if I had any idea how many cars he exported the previous month - I said 5 or 10 thinking it would not be that bad and he responded ZERO/NADA/ZIP.

The market in Europe had dried up not only because of the dollar improving somewhat but the fact Europe's economy was (and is) in a shambles.

In the interim, he began getting inquiries from China. Guess what? His business with China is booming. They want both new and used "luxury" cars and because he has been an established exporter, with exposure in the marketplace, they came to him. I have not really asked him about his Europe business but I know if it has come back at all it is a fraction of what it was.

Adapting. Exposure. Doing something and not allowing the government to freeze you in place waiting for them to save you. They won't, they screwed it up and business is what will bring it back.

3. In all the years I have worked with various vitamin manufacturers (about 12-13 now) the very best "long-term" customer for any of them came from a lead I generated from our website about 15 months ago during one of the worst parts of the past 24 months in the current economy. I mention in my blog post about adapting in dealing with 'how to pay' - this customer is in Thailand and they use 5 different credit cards to pay the manufacturer - whatever works.

4. I just received an email today from another company we work with for sourcing manufacturing in China. One of the leads we sent them, I cannot disclose their name but you would definitely know it as they are a old, long time brand name in a particular industry, has sent a sample to sourcing company's office in Beijing and for review of their engineers for pricing and they are very seriously working with the company on pricing the units out.

TRADE moves on and will find a way to adapt and there is always indirect exporting, meaning you do not need to export from the USA, you can export for a manufacturer in another country.

I think there was another post I did but I cannot remember the date in which I cited the number of LARGE brand name businesses that were started during the depth of the 1930's depression which are still in business today. International trade is either in your blood or it isn't and all I can say is move forward, adjust and continue to move forward, that is all there is to it.

Have a good evening.

Ron

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3 Comments:

Blogger Jim said...

Ron I'm thinking about getting into the exporting business strictly as a go-between for manufacturers and buyers but I have no idea where to start or even what to export.

Considering the fact that the U.S. has so few manufacturers and that agents are a dime a dozen I was wondering if you know where I might find more information about exporting products for manufacturers outside the U.S.?

Thanks,
Jim

4:28 PM  
Anonymous Import Export Business - Ron C said...

Jim,

What you are referring to is sometimes called 'indirect' exporting, but first let me address a BIG misconception you have about there being 'few' manufacturers in the USA. That is not true.

Yes, there are far less than there were 5, 10, 15, 20 years ago but the USA still has a huge manufacturing base and only a small % of them are exporting.

Agents or those who call themselves agents may very well be a dime a dozen but most of them have never invested in training and go about the business totally wrong. Quite frankly the most profitable relationships my business has contracted with in the last 15 years called me vs me calling them.

1:04 PM  
Anonymous customs clearance said...

Exports in most cases will grow with time,what i suggest for people who dont know too much about the business is to start out as a middleman or "agent",living off a comission of the total order.In about a years time,after you have done about 10 deals,you will learn immensely about the trade,and then maybe get into it ful lscale,provided you have the capital to do so too.

6:01 AM  

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