The Leading Edge - Summer 2011 - PKF - 14

Experts talk about how to fly your business into the global marketplace
By Danielle Toth

ith the post-recession environment and President Obama’s goal of doubling exports by 2014 with the National Export Initiative, even more businesses are dipping their toes into international water. Companies already there are getting more deeply involved. The key to success, whether you are a newcomer or a veteran, is knowing both the opportunities and the caveats. Resources, demand, compliance Small and medium-sized businesses can greatly benefit from the National Export Initiative, which provides a platform for U.S. companies to go international. “This is a real opportunity for businesses that are not exporting or are afraid to enter international business to jump on the bandwagon,” says James Min, vice president of international trade law and corporate compliance at DHL Americas, which is one of the largest logistic supply chain providers in the country. “This initiative is coordinating the Department of Commerce and other agencies to provide support to these businesses so they can have a partner in international business,” Min says. Among the assistance provided through the National Export Initiative at www. export.gov: basic how-to and market information, educational webinars, financing resources and access to local trade specialists. Min says DHL has seen the recession global slump change as demand is back up. Businesses are ramping up and doing so efficiently, rationally and intelligently because they’re making sure their capacity meets their demand. Many countries also have stepped up their enforcement of imports to ensure they’re collecting the appropriate taxes, says Larry Harding, president and founder of international business services provider High Street Partners in Annapolis, Md. “They’re not necessarily increasing tax rates, but they’re taking extra steps to make

sure all of the taxes that should be paid are being paid,” he says. In addition, Min says, countries are stepping up enforcement for security reasons. After Sept. 11, 2001, the United States required companies to submit data on imports at least four hours prior to their arrival in the country. With recent terrorism activity, security regulations are even tighter. Now shipment data must be submitted before it is even loaded onto an aircraft to come into the United States. Min says other countries will most likely follow suit, and eventually it will become a global standard. Where’s hot? EU countries and BRIC (Brazil, Russia, India and China) are excellent places to conduct business now because the U.S. dollar is weak, Harding says. “To some degree, there is a little bit of a perfect storm pushing U.S. companies to look to overseas markets,” he says. “The BRIC countries, and recently South Africa, are getting a lot of publicity for their huge growth rates and continued increased spending on technology and infrastructure. The weak dollar is making U.S. goods and services comparatively cheaper to the rest of the world than they have been in a long time.” The weak dollar creates a favorable Eurodollar and pound-dollar exchange rate that makes U.S. goods and services inexpensive for EU countries, Harding says. Min says he thinks many second-tier, non-BRIC economies such as Mongolia, Turkey, Israel, Chile, Peru, Vietnam and Colombia are also excellent areas for business right now. “These economies are growing rapidly, and while they may not be as large as China or India, they have some great opportunities,” he says. “Mongolia, for

example, has had GDP growth surpassing 10 percent for the past couple years, and a lot of that is driven by their supplying of raw materials and commodities to China. These countries have seen some solid GDP growth, very strong export activities and an obviously very well-educated workforce.” Harding offers that the only markets he thinks companies should avoid are places like United Arab Emirates because they have not yet recovered from the recession. What’s hot? The best industries right now are technology and infrastructure, including architectural firms and building suppliers such as concrete companies, Harding says. “In India, China and Brazil, they’re building more buildings and roads,” he explains. “They’re also upgrading their telecom networks and adding more broadband capabilities and mobile wireless capabilities.” The extraction industry, including oil, gas, minerals and other deposits, is hot as well, Min says, because commodity prices globally are still volatile and increasing rapidly, combined with the fact that demand is high for energy-related and other types of ore commodities. Consumer-related IT has also seen a lot of activity, even with the recent tsunami and earthquake in Japan. “Many folks thought there would be a dampening in the IT sector, but we’re seeing an indication that the
SUMMER 2011

The Leading Edge - Summer 2011 - PKF

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