American businesses buy trillions of dollars’ worth of products and services every year. If your company is not American but is looking for a piece of that marketplace, what are the best ways to break in to the American market?
Balancing Money vs. Time
Ideally we would all have limitless capital resources. If that were true, then you could acquire the company with the largest American market share. Or, you could quickly expand into every major American geographic market with local representation. On the other side, there are low-cost ways to enter the U.S., including distributors, local reps, strategic partnerships with companies selling related products and e-commerce. These channels do take time to establish and develop, so will not bring success as quickly as capital-intense approaches will.
Don’t Settle on the First Representative Option
The American market has many freelance sales representatives, distributors and business services professionals. If one learns that your company is looking to enter the American market, you will likely be approached for your business. This may or may not be the right resource for helping you enter the American market. Instead, talk to several potential partners, reps, distributors and suppliers. Ask the same questions and see where the differences exist. In many business cultures, new business relationships require an introduction from a mutual colleague. This is not the case in the U.S. The goal is to find the right resources that will make strategic sense and reinforce your company and products’ brands in terms of quality, values, and service.
Art of the American Fast Deal
Compared with the rest of the world, Americans make buying decisions and business deals very quickly. It is not necessary to have a previous relationship or even a current one to sell to American clients. This can make many non-American companies uncomfortable since they are doing business with a company and its representatives who are unknown and untested. When doing business in the U.S., you need to hire a local business transactions lawyer to write and review any contracts. Americans will expect any signed contracts will be enforceable in an American judicial court. Your American lawyer will help to keep language out of your contracts that increases your business risks.
Business Loyalty has a Price
I was recently talking with a client about possible companies that could acquire them. Since this is my client’s exit plan, we rolled through several names. But the most likely buyer was also a company that might shut the company down after purchase and eliminate the current staff. My client wanted to avoid this option until I asked him how he felt if he walked away from such an acquisition with US$3 million. His answer immediately switched. The truth is that American business leaders are heavily motivated by financial returns. For companies doing business with Americans, this means that if another supplier comes along offering a lower price or other incentives, you may lose that client before you ever knew that the relationship was in peril. The way to keep clients and business partners loyal is to periodically stop and ask them how the relationship is going. If someone is trying to underbid your company’s prices, your partner/client is likely to tell you when asked. Also, keep track of competitors in the American markets as to what incentives they are giving potential clients to switch away from your products.
I hope this article helps you in your business expansion. If your company needs assistance to expand into the United States and you have technical products or services, please feel free to contact me.