What Does it Take to Go Global?

Courtesy of www.temenos.ac.uk

By Carl Weiss

Going global is kind of like the weather.  Everyone talks about it, but almost nobody does anything about it.  The thought of going global mystifies many would-be international entrepreneurs. When you think  about this quandary in our Information Age, it’s kind of strange.  After all, we call it the “World Wide Web ” for a reason.  That’s because it’s the one medium that can put any company’s products and services in front of consumers worldwide.  That’s the good news.  The bad news is most small to mid-sized online businesses still limit their sales to their nation of origin.  Due to language and cultural differences, shipping regulations, customs requirements, tariffs and other red tape, many US companies restrict the size of their potential market. 

English: A typical mailroom and kitchenette (Photo credit: Wikipedia)

Without a doubt, the reason many companies shy away from doing business beyond their own nation’s borders is because a number of fledgling and even experienced exporters have been caught in judicial nightmare.

$15 Mailroom Mix-up Results in $90,000 Penalty

Lee Specialties, a Canadian manufacturer of oilfield equipment, found itself in hot water when it shipped rubber O-rings to the Middle East in 2012.  Most of the order for $6,054 worth of O-rings was being shipped to an address in Dubai.  But through a clerical error, $15 of O-rings was addressed to Tehran, Iran.  This not only caused the Canadian Border Service Agency to seize the entire shipment, it also resulted

in Lee Specialties being fined $90,000 for violating international trade sanctions.

“While it was clear that Lee Specialties made a mistake, that mix-up still cost the Alberta company $90,000, not to mention the legal fees they racked up during their two-year court battle.

“‘It seems like an innocent thing,’ noted Judge Allan Fradsham, approving the settlement and adding that the fine was ‘perfectly appropriate given the circumstances.’”  http://www.worldtradewt100.com/blogs/18-compliance-blog/post/90262-mailroom-mix-up-15-export-results-in-90000-penalty

And if you think shelling out $90 grand, plus court costs and legal fees for an innocent mistake is galling, wait until you hear about the Netherlands firm that was fined $10.5 million for violating US trade sanctions by exporting jetliner spare parts to the Sudan, Myanmar, and Iran between 2005 and 2010. 

   

Aircraft Parts Sales to Iran and Others Results in Fokker Being Fined

“‘Fokker Services VB, a Dutch company, flagrantly violated U.S. sanctions laws and this illicit activity will not be tolerated,’ said Adam Szubin, director of the U.S. Treasury's Office of Foreign Assets Control (OFAC).” http://www.cnbc.com/id/101735591

So it’s obviously dicey to ship goods to certain Middle East countries. No big surprise. But this isn’t the only region where exporters have been caught in the crosshairs of international intrigue.  There are currently US export restrictions on a number of countries including Russia, Cuba, North Korea, and Burma, among others. And the list changes all the time. 

An enlargeable map of the Islamic Republic of Iran (Photo credit: Wikipedia)

What this means to US e-tailers is that any time you export products internationally, you have to provide more information to government agencies than you do when shipping domestically.  You or someone whom you trust must know about the current and constantly changing rules and restrictions pertaining to selling and shipping goods overseas. Fortunately, there’s a document prepared by the Commerce Department that’s designed to guide you through the bureaucratic red tape.  “Preparing Your Business for Global E-Commerce,” is a 66-page e-book designed to walk you through everything — from the paperwork involved in exporting goods and services, to export controls, to shipping and returns, to insurance, and avoiding fraud.  http://export.gov/missouri/static/E-Commerce%20Guide_Latest_eg_us_mo_032053.pdf

While this is a good start at getting a handle on the ins and outs of international trade, it’s by no means the only steps you’ll need to take if you intend to sell and ship your goods to foreign shores. Not by a long shot.  Aside from the reams of red tape, two of the most daunting aspects of going global have to do with foreign languages and dealing with customs.  Some firms have learned the hard way that what works in the US sometimes loses something in the translation when attempting to sell their products abroad.

GM’s Chevy That Didn’t Go

You may have heard the story of how Chevrolet had a tough time selling its Nova sedan in Latin America back in the 1970s.  While the word “nova” means an exploding star to those of us north of the border, in Spanish speaking countries, “no va” translates to “it doesn’t go.”  Purportedly, Chevy was forced to pull the car from the market until a name change could be made. While this is an amusing anecdote about the vagaries of language, any would-be exporter should take it to heart before they trust their product’s future to translation software.

Chevy Nova (Photo credit: Chad Horwedel)

Technology is the hallmark of the Internet. Hence, there are numerous software packages

 that purport to translate any website into a number of foreign tongues. “Great! Bon! Bueno!” you say? Not so fast. Languages can also differ in dialect.  Just because you’ve translated a webpage or document into Spanish, for example, it doesn’t mean the Spanish used in Mexico is precisely the same as the Spanish spoken in Spain or Puerto Rico.  (I found this out during a videotaping session when the woman who was doing the voiceover informed the Cuban-American script writer that a particular word he wanted to use meant something completely different to anyone living in Puerto Rico, where he was planning on airing his ads.) My advice is to have an expert look over your translated website, blogs, as well as any and all verbiage before you wind up with huevos (“egg” in English) on your face. 

An article in the “Atlantic Monthly” entitled “Lost in Translation” goes even further in decrying the difficulties inherent of relying exclusively on translation software upon which to hang your exporting hopes. The article begins:

“In one famous episode of the British comedy series, Monty Python, a foreign-looking tourist clad in an outmoded leather trench coat appears at the entrance of a London shop. He marches up to the man behind the counter, solemnly consults a phrase book, and in a thick Middle European accent declares, ‘My hovercraft ... is full of eels!’”
 https://www.theatlantic.com/past/docs/issues/98dec/computer.htm

Even though translation software has become much more sophisticated since the “Atlantic Monthly” article was written, the point taken should be one of caution.  Just as it takes time to master a foreign tongue, so too does it take time to master all you need to know about exporting.  And if you think that transshipping your goods to the far side of the planet is tough, take a gander at the cautionary tale of a Washington state entrepreneur who tried to save a few bucks by driving his parcels into Canada himself instead of using FedEx.

How NOT to Stuck in Customs When Importing Goods into a Canada

English: A Canadian Customs and Immigration service sign (Photo credit: Wikipedia)

“Five minutes later I pull up to the US Customs and Border Protection booth.

CBP: ‘How long were you in Canada?’ Me: ‘Actually, I've never made it into Canada. I have commercial goods and I didn't know you weren't supposed to cross at Peace Arch.’ CBP (Eying all the Open Beam tubes in the back seat of my Accord): ‘What's in those tubes?’ Me: ‘It's, uh, a construction toy.’ CBP: ‘Construction toy?’ Me: ‘Yeah. Like Legos. For engineers.’ The CBP guy starts scribbling something fast and furious onto a bright orange sheet of paper. I can't read it, but I doubt it's a drug prescription.CBP: ‘Okay, go talk to that officer over there — he'll tell you where to go’ and slaps the orange sheet of paper on my windshield.

“I drive around to a very humorless and bored looking CBP officer. CBP2:’Where do you think you're going?’ Me: ‘They said I was supposed to talk to someone. I guess you're it.’ CBP2: ‘What you are *supposed* to do is to go inside that building over there. And take that orange slip with you.’ Me: ‘Ok.’

“Now, for those of you who've never had the pleasure of a CBP secondary inspection — these guys make post office workers look like type-A workaholics in a startup. For about 45 minutes, I watched as they typed away like trained chickens at a computer keyboard, asked a few questions, stamped the little orange sheet of paper — then walked away from the counter with said stamp over to a row of desks, took another seat, and proceed to type away at a different computer keyboard.

UP Sault Ste Marie MI SOO LOCKS LAW ENFORCEMENT Handsome Canadian Mounties BOARDER PATROL looking very NAUTICAL1- (Photo credit: UpNorth Memories - Donald (Don) Harrison)

“Finally, after about 45 minutes (with just one party of three kids in front of me) it was my turn. For the next three minutes or so, the CBP officer would stare blankly at his screen and click a few keys here and type a few sentences there. Suddenly, sirens sound. Over the intercom I hear, ‘Lane 2! Lane 2!’

“And, for how lethargic the CBP officer had previously been, he immediately bolted out of his chair and, along with a coworker, rushed out of the side door. I look over at the next booth to the 19-year-old visiting the US for the first time and he looks back at me with the same bewildered look on his face. I think we were both expecting to hear gunshots. Minutes went by, then as suddenly as the alert had begun, it was over. The CBP officer calmly walked back over to the counter.  Me: ‘What was that about?’ CBP3: ‘Don't worry about it.’” http://www.openbeamusa.com/blog/2012/07/31/stuck-in-customs-how-not-to-import-goods-into-a-neighboring-country

The author goes on to detail the harrowing ordeal, including having to wait while his entire vehic

le was run through an X-ray machine. Worse still, after being made to feel like some kind of international smuggler, the writer lamented he never made it through the Canadian border, and wound up turning back to the US in exasperation. He ends the story saying:

“I'm happy to report that by the time you are reading this, all of my Canadian orders have now shipped out along with almost all of the European, Australian and Asian orders. In light of the experience with importing goods into Canada — the extra $15 per parcel doesn't seem like too bad of a hit.”

The moral is you want to proceed with extreme care before you endeavor to sell your products on

 foreign shores.  Instead of running off half-cocked, you’d be well-advised to seek the advice of ex

Logo of the U.S. government's Small Business Administration. (Photo credit: Wikipedia)

perts in the field of exporting, as well as those of business persons who are already successfully their exporting goods overseas. 

The Small Business Administration (SBA) offers free resources and assistance for any business looking to start exporting.  Here’s a link to four resources that can help: http://www.sba.gov/community/blogs/interested-exporting-these-four-resources-can-help

Global Edge, http://globaledge.msu.edu/reference-desk/export-tutorials , offers a series of free online tutorials covering:

·         Is your company ready to export?

·         Government Regulations

·         Financial Considerations

·         Sales and Marketing

·         Logistics

Amazon.com has a book entitled, “Basic Guide to Exporting – The Official Government Resource for Small and Medium-Sized Businesses.” http://www.amazon.com/Basic-Guide-Exporting-Government-Medium-Sized/dp/0160869536

As you can see, the promise of profits is tantalizing enough to consider taking the time and trouble to learn about exporting. The moral of this story? In the exporting game, a little knowledge and $15 can make you … or break you.

In this article, I discussed the benefits and pitfalls of taking your product or service global via the World Wide Web. I’ve shared some actual stories where companies were heavily fined because they did not take into account current laws, or lost sales because of translation issues.

If you like this article, you can find more by typing “advertising" or entrepreneur” in the search box at the top left of this blog.

If you found this article informative, share it with your friends, family and co-workers. If you feel you have something to add or just want to leave a comment below. I look forward to reading your comments.

Until next time.

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Carl Weiss is president of Working the Web to Win, a digital marketing agency based in Jacksonville, Florida.   You can listen to Carl live every Tuesday at 4pm Central on BlogTalkRadio.

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