Chapter 7: MAKING CONTACTS

After a company has identified its most promising markets and devised strategies to enter those markets, the next step is to actually locate a buyer. If that buyer is the end user of a company's product or service, a relatively simple transaction may result. In many cases, however, U.S. exporters need an in-country presence through a representative or distributor to reach the eventual buyer. Alternatively, the firm may identify customers through attendance at trade shows, trade missions, direct mail campaigns, and advertising.

Regardless of how the exporter makes contacts and develops sales leads, the exporter faces many questions:

In this chapter U.S. exporters will find the means to answer these questions. The marketing techniques described are by no means exhaustive. However, the chapter describes sources of assistance in locating buyers, evaluating trade missions and shows, and conducting other programs designed to make contacts.

DEPARTMENT OF COMMERCE CONTACT PROGRAMS

The U.S. Department of Commerce can help exporters identify and qualify direct leads for potential buyers, distributors, joint venture partners, and licensees from both private and public sources. Along with its various product, country, and program experts, the Department of Commerce has an extensive network of commercial officers posted in countries that represent 95 percent of the market for U.S. products.

Services and publications available through the Department of Commerce are listed in this section. Exporters should contact the nearest Commerce district office (see appendix III) for more information or contact Export Promotion Services, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, DC 20230; telephone 202-482-2505.

Export Contact List Service

The ECLS provides mailing lists of prospective overseas customers from Commerce's automated worldwide file of foreign firms. It identifies manufacturers, distributors, retailers, service firms, and government agencies. A summary of the information on the company includes name and address, cable and telephone numbers, name and title of a key official, product and service interests, year established, and additional data. The lists are drawn from an on-line search of Commerce data on the basis of the market or company criteria specified by the exporter. The information is available either as cheshire or gummed mailing labels or as a summary printout of company data. Cost is 25 cents per name, with a minimum order of $10.

Trade Opportunities Program (TOP)

This service provides timely sales leads from overseas firms seeking to buy or represent U.S. products and services. U.S. commercial officers worldwide gather leads through local channels. Lead details such as specifications, quantities, end use, and delivery and bid deadlines are telexed daily to the computer center in Washington, D.C., reviewed, and then immediately posted on Commerce's EBB. Users can retrieve the TOP files (and all other files) from the EBB each day through a personal computer and modem. Subscribers may use, edit, or redistribute the leads in any way they wish. A subscription for all files on the EBB is $35 per year.

TOP leads are also published each day in the Journal of Commerce. Other trade information services such as TradeNet, Intellibanc, Commodity Developers Trade Group, state trade development agencies, and world trade centers also distribute TOP leads and leads obtained from their own services.

Agent/Distributor Service (ADS)

The ADS is used to locate foreign import agents and distributors. It provides a custom search overseas for interested and qualified foreign representatives on behalf of a U.S. exporter. Officers abroad conduct the search and prepare a report identifying up to six foreign prospects that have examined the U.S. firm's product literature and have expressed interest in representing the U.S. firm's products.

The U.S. company is given the names and addresses of the foreign firms, names and titles of persons to contact, telephone numbers, cable addresses and telex numbers, and brief comments about the agent or distributor and its stated interest in the proposal. A fee of $125 is charged for this service.

ADS application forms may be obtained from Commerce district offices. Trade specialists at these offices can help with preparing applications and can provide guidance if there are any factors barring the desired relationship.

World Traders Data Reports

The WTDR service provides a background report on a specific foreign firm, prepared by commercial officers overseas. WTDRs give such information as the type of organization, year established, relative size, number of employees, general reputation, territory covered, language preferred, product lines handled, principal owners, financial references, and trade references. Each WTDR also contains a general narrative report by the U.S. commercial officer who conducted the investigation concerning the reliability of the foreign firm. A fee of $100 is charged per report. Further information on this service is available from any Commerce district office.

Commercial News USA (CNUSA)

CNUSA provides worldwide exposure for U.S. products and services through an illustrated catalog-magazine and electronic bulletin boards. The catalog-magazine is distributed through U.S. embassies and consulates to business readers in 140 countries. Copies are also made available to international visitors at trade events around the world. Current hard-copy distribution averages 110,000 copies, with 10 issues per year. Information in CNUSA is further disseminated by US&FCS posts or local organizations that reprint all or part of the publication. CNUSA's electronic distribution in key overseas markets reaches an additional 130,000 business readers. It operates through private sector and government electronic business bulletin boards in 15 countries.

Listings in CNUSA describe the major features of an export product or service. The name, address, and telephone and fax numbers of the U.S. manufacturer or distributor are included along with a photo or illustration. Several size formats are available. A standard one-sixth page lists an average of 40 to 60 words and costs $250; larger formats may contain longer descriptions. The electronic versions of CNUSA transmit the complete text of the magazine listings, without illustrations, to EBB subscribers.

The CNUSA program covers more than 30 industry categories and focuses on products that have been on the U.S. market no longer than three years. Companies may also market services and trade and technical literature through CNUSA. Only pharmaceuticals, raw materials, agricultural commodities, and items on the Federal Register Munitions List are excluded from CNUSA. All products in CNUSA must be at least 51 percent U.S. parts and 51 percent U.S. labor.

CNUSA also profiles up to three industries per issue with high export potential. In these special industry sections, U.S. firms may promote established products as well as new models. Participants may purchase up to three separate listings per issue, each focusing on a single product model. A new product may be listed four times per year. CNUSA does not feature descriptions of entire product lines or accept camera-ready advertisements.

The trade leads generated by CNUSA help U.S. firms identify potential export markets and make contacts leading to representation, distributorships, joint venture or licensing agreements, or direct sales. Overseas inquiries come directly to participating U.S. firms and are address coded to allow for tracking and program evaluation. Interested firms should contact the nearest Commerce district office for information.

DEPARTMENT OF COMMERCE TRADE EVENT PROGRAMS

Some products, because of their very nature, are difficult to sell unless the potential buyer has an opportunity to examine them in person. Sales letters and printed literature can be helpful, but they are certainly no substitute for an actual presentation of products in the export market. One way for a company to actually present its products to an overseas market is by participating in trade events such as trade shows, fairs, trade missions, matchmaker delegations, and catalog exhibitions.

In today's international market, trade fairs are "shop windows" where thousands of firms from many countries display their wares. They are marketplaces where buyer and seller can meet with mutual convenience. Some fairs, especially in Europe, have a history that goes back centuries.

Attending trade fairs involves a great deal of planning. The potential exhibitor must take into account the following logistic considerations:

There are many excellent international trade fairs, both privately run and government sponsored. A trade magazine or association can generally provide information on major shows. Because of the many considerations facing exhibitors, a company may wish to attend a Department of Commerce-organized U.S. pavilion overseas. For additional guidance, contact the local Commerce district office (see appendix III) or US&FCS International Operations regional director (see appendix II).

Certified Trade Fair Program

The Department of Commerce Certified Trade Fair Program is designed to encourage private organizations to recruit new-to-market and new-to-export U.S. firms to exhibit in trade fairs overseas. To receive certification, the organization must demonstrate that (1) the fair is a leading international trade event for an industry and (2) the fair organizer is capable of recruiting U.S. exhibitors and assisting them with freight forwarding, customs clearance, exhibit design and setup, public relations, and overall show promotion. The fair organizer must agree to assist new-to-export exhibitors as well as small businesses interested in exporting.

In addition to the services the organizer provides, U.S. exhibitors have the facilities and services of the Department of Commerce available to them. Commerce can also

Foreign Buyer Program

The Department of Commerce encourages foreign buyers to attend selected U.S. trade shows. US&FCS selects leading U.S. trade shows in industries with high export potential. U.S. firms are assisted in fulfilling their international business objectives through their participation in selected U.S. trade shows where they can meet foreign buyers, distributors, potential licensees or joint venture partners.

Each show selected for the Foreign Buyer Program receives special promotion through overseas mailings, U.S. embassy and regional commercial newsletters, CNUSA, Business America, foreign trade association and chambers of commerce journals, and trade journals overseas. US&FCS works with U.S. companies exhibiting at these shows by helping U.S. firms match their products, marketing objectives, and geographic targets with the needs of the international business visitors.

Through the Commerce district offices, international trade specialists are ready to take exhibiting U.S. firms through the exporting process and provide counseling to them before the trade show. In addition, an international trade specialist is available at each show to provide on-the-spot export counseling. The Foreign Buyer Program is also an excellent means for experienced exporters to penetrate new markets.

For additional information contact a local Commerce district office or U.S. and Foreign Commercial Service, Export Promotion Services, Room 2118, Washington, DC 20230. For an application and additional information telephone the Foreign Buyer Program manager at 202-482-0481.

Matchmaker Trade Delegations

Matchmaker trade delegations, organized and led by Commerce personnel, enable new-to-export and new-to-market firms to meet prescreened prospects who are interested in their products or services in overseas markets. Matchmaker delegations usually target major markets in two countries and limit trips to a week or less. In this way, U.S. firms can interview a maximum number of prospective business partners with a minimum of time away from the office. Participants also take advantage of group-rate hotels and airfare as well as on-the-spot U.S. embassy support. Thorough briefings on market requirements and business practices and interpreters' services are also provided. Delegation members pay their own expenses and a share of the operating costs of the event.

Trade Missions

Department of Commerce trade missions are planned visits to potential buyers or clients overseas. Missions can be undertaken by firms individually or in an organized group. Like trade shows, trade missions require careful planning and attention to scheduling. Much of the planning and coordination is done for participants.

Commerce-sponsored trade missions are carefully organized and planned to achieve maximum results in expanding exports of U.S.-produced goods and services. They are usually composed of fewer than 12 but more than 5 U.S. business executives. Markets to be visited and products to be promoted are carefully selected on the basis of relevant market research and consultations with US&FCS officers abroad. The primary objectives of Commerce-sponsored trade missions are to introduce U.S. firms to appropriate foreign buyers and to establish representation, joint ventures, and licensing agreements.

Several types of trade missions have been developed to help U.S. exporters penetrate overseas markets:

These missions are also published in the Export Promotion Calendar, available at local Commerce district offices (see appendix III).

Catalog Exhibitions

U.S. firms may test foreign markets, develop sales leads, and locate agents or distributors through catalog exhibitions sponsored by US&FCS, in some instances in conjunction with the Department of State's foreign service posts. These exhibitions feature displays of a large number of U.S. product catalogs, sales brochures, and other graphic sales aids at up to 10 U.S. embassies and consulates or in conjunction with trade shows in a region. Commercial staff provide each participant with sales leads and a visitors list of all foreign buyers attending the event.

Because it requires the exporter to make a much smaller investment than a trade mission or other personal visits, this program is particularly well suited for use in developing markets. For more information contact a local Commerce district office or the Marketing Programs Division, Room 2119, Export Promotion Services, U.S. Department of Commerce, Washington, DC 20230; telephone 202-482-3973.

OTHER DEPARTMENT OF COMMERCE PROGRAMS

Export Development Offices (EDOs)

EDOs in seven cities overseas provide a variety of programs and services to U.S. exporters. Staffed by US&FCS commercial officers, the EDOs are the principal U.S. export promotion facilities overseas. The primary role played by the EDO (in conjunction with the US&FCS in the local U.S. embassy or consulate) is threefold:
  1. It conducts or assists in market research in the country, helping to identify specific marketing opportunities and to determine which products have the greatest sales potential.

  2. It conducts export promotion events in its region that have been organized on the basis of market research findings.

  3. It helps organize participation of specific U.S. exporters in these events.
Located in Tokyo, Sydney, Seoul, Milan, London, Mexico City, and Sao Paulo, these offices organize and coordinate a range of export promotion programs, including on-site trade shows, U.S. pavilions in international trade fairs, solo U.S. exhibitions, trade seminars, trade missions, catalog exhibitions, video and catalog exhibitions, and special promotions. Each EDO performs these functions only in the country in which it is located.

When not being used to stage trade exhibitions, EDOs with exhibit and conference facilities frequently are made available to individual firms or associations. Facilities can be used for sales promotions, seminars, and sales meetings. For a nominal fee, EDOs and some commercial offices overseas also provide use of limited office space for traveling U.S. business representatives as well as local telephone use, a market briefing, use of audiovisual equipment, and assistance in making appointments.

Major Projects Program

This program helps U.S. firms win contracts for planning, engineering, and constructing large foreign infrastructure and industrial systems projects, including equipment and turnkey installations. Assistance is provided when requested by a U.S. embassy, a prospective foreign client, or a U.S. firm, either to encourage U.S. companies to bid on a particular project or to help them pursue overseas contracts.

Speed and flexibility in developing a strategy for each case are essential elements in the assistance given U.S. firms. As circumstances warrant, the Office of International Major Projects mobilizes and coordinates appropriate support from other U.S. government agencies, including foreign service posts abroad. For further information, contact Office of International Major Projects, Room 2015B, Trade Development, International Trade Administration, U.S. Department of Commerce, Washington, DC 20230; telephone 202-482-5225.

Textile and Apparel Export Expansion Program

In recognition of the increasing importance of textile and apparel exports, Commerce has created this program to encourage and assist U.S. manufacturers in initiating or expanding export sales, and to improve foreign market access for these products. To achieve these goals, the program does the following: The program is administered by the Market Expansion Division, Office of Textiles and Apparel; telephone 202-482-5153.

DEPARTMENT OF AGRICULTURE FORIEGN AGRICULTURAL SERVICE

Through a network of counselors, attaches, trade officers, commodity analysts, and marketing specialists, USDA's FAS can help arrange contacts overseas and provide promotional assistance. The programs and services offered are described in this section.

Commodity and Marketing Programs

The Commodity and Marketing area of FAS handles inquiries for specific commodity-related information. Each division provides support for analysis of consumption, trade, stocks, and so on, and marketing information. The six divisions and their telephone numbers are as follows.
  1. Dairy, Livestock, and Poultry Division, 202-447-8031.
  2. Grain and Feed Division, 202-447-6219.
  3. Horticultural and Tropical Products Division, 202-447-6590.
  4. Oilseed and Oilseed Products Division, 202-447-7037.
  5. Tobacco, Cotton, and Seed Division, 202-382-9516.
  6. Forest Products Division, 202-382-8138.

High-Value Product Services Division

The High-Value Product Services Division's purpose is to expand overseas markets for U.S. agricultural and food commodities and products through a wide range of services, which are described in this section.

AgExport Connections

AgExport Connections provides information services to help expand and promote agricultural exports. It offers the AgExport Action Kit, which describes services available from USDA to help U.S. food and agricultural exporters. Other AgExport Connections services are as follows:

Trade Shows

The High-Value Product Services Division also organizes U.S. pavilions at major international trade shows and exhibitions. These events provide a cost-effective way of testing a market, checking the competition, meeting foreign buyers and consumers, and establishing new contacts. The Trade Show Coordinators Office can assist U.S. exhibitors with obtaining a booth, advance publicity, product shipment, and customs clearance.

Trade Assistance and Planning Office (TAPO)

The USDA's TAPO provides a single point of contact in the FAS for agricultural exporters who need foreign market information, as well as for those who believe they have been injured by unfair trade practices. TAPO can help U.S. agricultural exporters contact the appropriate offices of federal agencies that administer trade remedy laws, and it may be able to provide supporting data and information. The office prepares several annual reports that may be of interest to U.S. agricultural exporters. Contact Trade Assistance and Planning Office, Foreign Agricultural Service, U.S. Department of Agriculture, 3101 Park Center Drive, Suite 1103, Alexandria, VA 22302; telephone 703-756-6001.

AGENCY FOR INTERNATIONAL DEVELOPMENT

AID administers most of the U.S. foreign economic assistance programs. These programs offer export opportunities for U.S. suppliers of professional technical assistance services and commodities (goods, products, equipment, and material). Professional technical assistance services generally offer opportunities for consultant and expert capabilities in agriculture, nutrition, and rural development; education and human resources; health and population; and energy and environmental assessment. Opportunities to export commodities are available through the commodity import programs that AID operates in select AID recipient countries, and through AID's direct procurement of commodities. In addition, AID funds may be available to finance developmentally sound projects in certain recipient countries involving U.S. capital goods and services. U.S. exporters are best positioned to obtain orders by making the local purchasing agencies aware of their products at an early stage. For information on available funds, projects under consideration, and contacts, exporters traveling to developing countries where an AID program is in place may wish to visit the AID mission in the U.S. embassy.

For the most part, AID advertises export opportunities for both professional technical assistance and commodities in the Commerce Business Daily, available through paid subscription from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402-9371. Notices of intended procurement of AID-financed commodities are also advertised in the AID Procurement Information Bulletin, available through free subscription from AID's Office of Small and Disadvantaged Business Utilization/Minority Resource Center (OSDBU/MRC), Washington, DC 20523-1414; telephone 703-875-1498.

TRADE AND DEVELOPMENT PROGRAM

TDP is an independent U.S. government agency that funds feasibility studies, consultancies, training programs, and other project-planning services in middle-income and developing countries and in Eastern Europe. Contracts funded by TDP grants must be awarded to U.S. companies, thus helping position potential U.S. suppliers of goods and services for follow-on contracts when these projects are implemented.

Most TDP funding is granted for feasibility studies in sectors that are of high priority to host governments: agribusiness, educational technology, electronics, energy, minerals development, telecommunications, transportation, and waste management. To ensure a satisfactory and useful study, the host governments play an active role in awarding and managing the contract. This cooperation also engenders a cooperative relationship between the host country, TDP, and the business community.

In addition, opportunities for technical consultants also arise in connection with definitional missions to investigate the scope of a project, develop a scope of work for a feasibility study, draw up a budget estimate, and make a recommendation concerning TDP support for the study. TDP selects qualified consultants through use of a consultants data base, for which U.S. small businesses are encouraged to register.

TDP-funded activities have generated approximately $3 billion of U.S. exports through fiscal year 1990, with an additional $20 billion in direct U.S. exports projected over the next decade. More than 400 companies in 40 states and the District of Columbia have benefited from activities supported by TDP, both through direct exports and through long-term enhancement of their market position.

TDP's programs are carried out by a Washington-based staff in close coordination with the Department of Commerce, AID, and other government agencies. TDP also maintains close contact with multilateral and regional development lending institutions to ensure an ongoing exchange of important project information and to keep TDP apprised of critical opportunities for U.S. companies. Projects evaluated for TDP funding must meet the following selection criteria:

For more information on TDP contact U.S. Trade and Development Program, SA-16, Room 309, Washington, DC 20523-1602; telephone 703-875-4357.

STATE AND LOCAL GOVERNMENT ASDSISTANCE

Most states can provide an array of services to exporters. Many states maintain international offices in major markets; the most common locations are in Western Europe and Japan. Working closely with the commercial sections of U.S. embassies in these countries, they can provide assistance in making contacts in foreign markets, providing such services as the following: Increasingly, many cities and counties are providing these same services. Appendix III lists contacts at both the state and city levels.

BUSINESS AND SERVICE ORGANIZATION CONTACTS

Contacts made through business colleagues and associations can often prove invaluable to U.S. exporters. A colleague with firsthand experience in an international market may give a personal recommendation for an agent, distributor, or potential buyer. Conversely, the recommendation against the use of a representative for credit or reliability reasons may save the firm a number of problems. Attending export seminars and industry trade shows is an excellent method of networking with business people who have international experience. In addition, trade associations can provide a valuable source of contacts with individuals who may wish to share their experience of identifying and selling to buyers and representatives in foreign markets.

Banks can be another source of assistance in locating overseas representation. The international departments, branches, or correspondent banks of U.S. banks may help locate reputable firms that are qualified and willing to represent U.S. exporters. In addition, freight forwarders, freight carriers, airlines, port authorities, and American chambers of commerce maintain offices throughout the world. These service firms often have contacts with qualified representatives and can make recommendations to the U.S. firm. Foreign embassy and consulate commercial offices may also be able to provide directories and assistance.

PROMOTION IN PUBLICATIONS AND OTHER MEDIA

A large and varied assortment of magazines covering international markets is available to exporters through U.S. publishers. They range from specialized international magazines relating to individual industries such as construction, beverages, and textiles, to worldwide industrial magazines covering many industries. Many consumer publications produced by U.S.-based publishers are also available. Several are produced in national-language editions (Spanish for Latin America, and so on) and also offer "regional buys" for specific export markets of the world. In addition, several business directories published in the United States list foreign representatives geographically or by industry specialization.

Publishers frequently supply potential exporters with helpful market information, make specific recommendations for selling in the markets they cover, help advertisers locate sales representation, and render other services to aid international advertisers. For an extensive list of these international publications see the International Section of Business Publication Rates and Data, a book published by Standard Rate and Data Service, 5201 Old Orchard Road, Skokie, IL 60077. Another publication, The Gale Directory, contains an even more complete list of foreign periodicals, but it provides less detailed information on circulation and rates. These directories may be available at libraries; Commerce district offices; or in the Department of Commerce's Reference Room, Room 7046, Washington, D.C. State departments of commerce, trade associations, business libraries, and major universities may also provide these publications.

Television, radio, and specially produced motion pictures may also be used by a U.S. business for promoting products or services, depending on the country. In areas where programs may be seen and heard in public places, television and radio promotions offer one of the few means of bringing an advertising message to great numbers of people. In many countries, particularly in Latin America, various forms of outdoor advertising (billboards, posters, electric signs, and streetcar and bus cards) are widely used to reach the mass audience.

Because of the specialized knowledge required to advertise and promote successfully in foreign markets, U.S. firms may find useful the services of a U.S. advertising agency with offices or correspondents abroad. Some U.S. agencies handle nothing but foreign advertising, and some marketing consultants specialize in the problems peculiar to selling in foreign markets. The International Advertising Association, Inc., 475 Fifth Avenue, New York, NY 10017, can provide names of domestic agencies that handle overseas accounts.

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