Archive for September, 2010

September 23rd, 2010

U.S. Customs Series: Tips for corporate gifts …

The Christmas season is fast approaching and your marketing department has already chosen the corporate gifts to send to your best customers in the U.S without thinking how the gifts will be shipped.

The worst corporate gifts are food and alcoholic beverages, clothing or textile articles.

To export chocolates, candies and maple syrup to the U.S., you must be registered with the FDA (Food & Drug Administration). The producer, packer and your customer also need to be registered. You will need to make a special statement (prior notice) to the U.S. Department.For alcoholic beverages (spirits, wine or cider), you need to make a report to the Alcohol, Tobacco & Firearms department for special labelling and additional taxes.

For clothing and textile goods, you should check the label and verify that there isn’t any quota that could block your shipment.

For watches and clocks, the U.S. requires that movement, watch casing and bracelet to be marked separately from their country of origin. In addition, you need to enter their value separately because the rates of duties vary depending on movement, watch casing and battery.

The best way to send your corporate gifts is by mail (except tobacco and alcohol) addressed to your client at their home address. Any American citizen can receive a gift worth less than $100 without paying duties or taxes. If you send a gift by courier companies or directly on behalf of the company abroad, you should use a division in the commercial sector.

Please take note that this information comes from the website of Formation en Douanes Louise Chevanelle inc.

If you are interested in knowing more about the U.S. and international customs do not hesitate to contact me. If enough companies show interest, we will consider providing training sessions.

Caroline Bouchard

September 18th, 2010

Combining exports and foreign investments – a winning model

Seventeen American biopharmaceutical firms participated in the North American Bio Forum 2010, created with a view to furthering alliances between five CROs in the Biotech City – Algorithme Pharma, Cirion, Corealis, LAB and Warnex – and the U.S. biopharmas.

This event was developed together with our five CROs. In fact, it was during a conversation with one of them that the idea for scientific conferences with buyer meetings was conceived. We then approached the others to gauge their interest in the project, whose overriding objective was to further alliances between our CROs and U.S. firms.

This is a unique event because by inviting companies to Laval, we also help increase foreign investment. The fact is that every dollar spent by the U.S. biopharmas in a Laval CRO is a dollar invested in R&D in Laval and in Quebec. The investments are extremely important because they lead to wealth creation in Laval.

The initial results are already encouraging. Not only have the participants written to tell us how satisfied they were with the event, particularly the solid meetings with potential R&D partners, but negotiations are underway to formalize partnerships. I believe concrete sales will soon follow. Finally, some firms have already expressed an interest in setting up operations in the Biotech City.

To see organizations like the International Business Centre combine exporting and investments is rather unusual. The tendency is to work on each aspect separately but the truth is you get more synergy by addressing them together.

I’m convinced that our strategy will lead to a winning economic development model. Time will tell if I’m right.

Véronique Proulx, MBA

September 16th, 2010

U.S. Customs Series: You will need to show more information to cross the border!

Everyone knows that a passport is now required to cross the U.S. but from a commercial perspective what does it mean exactly?

We all know that, customs requires electronic information BEFORE the goods reach the border. Today, no carrier can cross the boarder without being registered in the customs system: barcode, truck coordinates, transport equipment, plate numbers, full description of goods, etc. This declaration must be sent one hour before arrival at the border. Your broker must also encode all information electronically: HS code numbers for all products, identification (ID) of the purchaser, manufacturer, importer, etc.

However, in the near future, you will need to send even more information:

Regarding new 10+2 regulations in the U.S.

Regarding modification of Lacey Act

Regarding new CPSIA regulations

None of these new measures will facilitate the exchange of goods between our two countries.

To learn more, I suggest consulting the website of Formation en Douanes Louise Chevanelle inc.

If you are interested in knowing more about the U.S. and International customs please contact me. If enough companies show interest, we will consider providing training sessions.

Caroline Bouchard

September 9th, 2010

Why intercultural awareness is important in international business?

In today’s global marketplace, the chance of losing business due to cultural misunderstandings runs high.

Many specialists use the iceberg model to explain the culture. In everyday interaction we see only the surface level of culture, i.e books, film, food, fashion and language. It is the underbelly of the cultural iceberg that poses the problems. Their are fundamentals such as attitudes, beliefs, assumptions, world views, communication styles and values. If people are unaware of such differences when it comes to such fundamentals, the potential for misunderstandings, poor communication and failed relationships are increased.

For the last two years I have organized meetings and trade missions with people from all over the world. Too often, I meet people who don’t understand why they didn’t get a deal in a specific market. When I start talking to them, I realize they have no idea of cultural differences and this is probably one of the reasons why they didn’t close the deal.

You will find below the main areas posing particular cross cultural barriers. I will use as an example Arabic culture based on my observations during our trade mission in the UAE.

Body language: Men and women would not greet each other in public. Women only kiss their close friends.
Etiquette: During a meeting, not answering a phone call is considered to be impolite.
Establishing trust: Business and personal life are not separated. Knowing a person on a personal level is crucial.
Religious beliefs: The Islamic world places much more importance on the spoken word than anything else. It is important to keep our promises. Broken promises will lead to broken relationships.
Social habits: Decisions usually come from the top. If you are negotiating with a middle-man, you are most likely wasting your time.

Other more cross cultural barriers could be invoicing and payments, credit terms, customer preferences, packaging – i.e. sizes, colours, typeface, etc.

Being aware of those differences will certainly help you do business abroad. In addition, as the competition comes from all over, one of the most effective ways of getting ahead is to use language and cultural knowledge at your advantage.

I suggest that you visit the following websites to access useful tips about cultural differences:

Executive Planet: http://www.executiveplanet.com

Kwintessential: http://www.kwintessential.co.uk/resources/country-profiles.html

I would like to conclude by saying that these tools act as an introduction to basic and general information about doing business with different cultures. Please keep in mind that every country and culture will have its nuances. It is impossible to suggest a uniform approach to understanding these subtleties.

Caroline Bouchard

September 8th, 2010

Choosing the right foreign partner is the key to success

The theme of the International Business Centre Export Network’s last meeting was international partnerships. The participating entrepreneurs had an interesting discussion comparing theory against their experiences in the field. Here is a summary of the takeaways from that meeting.

When choosing a partner, keep these tips in mind:

Know your target market well so you can define the profile and role of the ideal partner and once you find that person, propose a strategy and explain how the product will be positioned;

Meet with several candidates, ask questions about their references, market knowledge and technical skills;

Do extensive research yourself to verify the candidate’s market knowledge, reputation and financial situation and make sure he’s not already distributing competing products;

In the early stages, visit customers together to see, for example, how your partner works, his customer approach, and the types of obstacles encountered;

Be careful about offering exclusivity and have an exit strategy – a partnership doesn’t always work out or perhaps some market leaders suddenly express interest in your products.

To be successful, you must then:

Ask for a detailed action plan or help your partner define one by providing a sample or template;

Provide your partner and his team with technical and sales training, including paying for all or some of their travel expenses based on performance.Set quarterly objectives in terms of sales or steps in the sales cycle in order to avoid unpleasant surprises;

Provide uncomplicated control forms that are easy to use and complete so that you can track performance and quickly take action if problems arise;

Offer competitive compensation and clearly set out what you expect in return;

Be patient; it usually takes a number of years to achieve profitability.

One last tip: in order to avoid misunderstandings and disputes, you should always hire a lawyer with expertise in international law, regardless of the type of agreement.

To learn more, please read our fact sheet titled Export successfully with manufacturers’ agents. Although it deals specifically with manufacturers’ agents, most of the principles apply to all kinds of partners. Another recommended article from MercadexPress also provides helpful pointers on how to choose a foreign partner.

Bruno Séguin