Why making connections abroad matters for emerging companies
Louis Ho, the director of the Hong Kong Trade Development Council’s seven offices in North and South America, freely admits he didn’t know that much about Wisconsin until a recent visit to Minnesota’s Twin Cities persuaded him to look across the border.
The New York-based Ho is glad he made the return trip.
Wisconsin expertise in water technologies, aerospace, biotechnology, information technology, and energy found its way onto Ho’s itinerary during a mid-October trip to Wisconsin, during which he and others from the trade council met with company and tech sector representatives in Milwaukee, Madison, and the Fox Valley.
Their message: Wisconsin companies with research, production, or logistical needs in Asia should look to Hong Kong as a secure, cost-effective, and relatively “red-tape-free” portal into emerging markets in China and the Pacific Rim.
Trade representatives from other nations boast competing messages, of course, but the larger point is that Wisconsin is steadily improving its standing in the global marketplace of trade and foreign direct investment.
Simple demographics should tell U.S. business owners all they need to know about the size of the opportunity: About 95% of the world’s population lives outside the United States, and a rising percentage of those people are “middle class” consumers.
American exports are projected to grow 4% annually over the next four or five years, outpacing overall U.S. economic growth estimates.
Less obvious to many business owners, especially smaller firms and startups, is how to efficiently and safely break into that global marketplace.
Wisconsin’s exports have been steadily climbing in recent years. They hit a record $23 billion in 2012 (good for 18th among the 50 states) and are on pace for another record in 2013. Still, there are still plenty of companies that could be exporting goods and services but have yet to do so.
A blend of routine business pressures in existing markets, awareness of market potential overseas, and fear of the unknown — languages, red tape, and economic espionage — are primary barriers. There are ways for companies to begin clearing those hurdles, however, often without leaving home.
- The Wisconsin Economic Development Corp., through its international division, has developed export mentoring programs, events, and grant programs for small to mid-sized companies to cover some of the costs related to developing an export strategy and growing sales over time.
- Organizations such as the Madison International Trade Association and the World Trade Center in Milwaukee work with importers and exporters alike, often providing market intelligence and seminars on specific markets and topics.
- The UW System is an often-overlooked source of help for businesses in need of market intelligence, business assistance, or help navigating language, cultural, and protocol issues. The presence of thousands of UW graduates abroad creates networks in many of the world’s leading markets, and the university has established offices in places such as Shanghai.
- Finally, many countries are represented as nearby as Chicago. The Chicago International Trade Commissioners’ Association has about 50 members representing 40 countries.
Nothing helps like firsthand stories, however. At next month’s Wisconsin Early Stage Symposium in Madison, one speaker will talk about his company’s growth in markets that might seem remote to many in Wisconsin — but which hold enormous potential.
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Mark Schmitz, whose state-based ZEBRADOG creative firm is working on projects from Saudi Arabia to South Africa and from Ireland to the Bahamas, will speak during the Nov. 5 luncheon for the Small Business Innovation Research awards.
Schmitz will talk about how one of Wisconsin’s leading outputs — intellectual property — is coveted by companies and institutions in emerging economies that increasingly have the capital, the infrastructure, and the expertise to put it to work. His international clients include Saudi Aramco, Kerry Ingredients, and the Qatar Foundation.
Wisconsin companies cannot sell all they produce at home, in the Midwest, or even nationally. Cracking into foreign markets that may want to buy what Wisconsin offers is a logical business plan for many.
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