Unsurprisingly, this year’s top stories included several focused on technology such as digital trade and AI. There was also a lot of interest in sustainable practices, tips for women leaders and the value that immigrant-led businesses can bring in Canada and beyond.

Enjoy this year’s top international trade articles.

1. 10 global trade trends we’ll be watching in 2023

10 global trade trends we’ll be watching in 2023

2. Why digital trade should be a cornerstone of Canada’s Indo-Pacific Strategy

Why digital trade should be a cornerstone of Canada’s Indo-Pacific Strategy

3. 7 emerging cleantech suppliers that can help you create a more sustainable supply chain

7 emerging cleantech suppliers that can help you create a more sustainable supply chain

4. Unpacking the Digital Transformation of Trade

Unpacking the Digital Transformation of Trade

5. How to Take Your Business Global – 5 Important Steps for Female Leaders

How to Take Your Business Global – 5 Important Steps for Female Leaders

6. Investing in immigrant founders to unlock the next generation of Canadian innovation

Investing in immigrant founders to unlock the next generation of Canadian innovation

7. 8 common global procurement mistakes made by small and medium sized businesses (SMEs)

8 common global procurement mistakes made by small and medium sized businesses (SMEs)

8.Top 10 things we learned at the WPO 2023 Entrepreneurial Excellence Forum

Top 10 things we learned at the WPO 2023 Entrepreneurial Excellence Forum

9. 5 ways AI is transforming international trade

5 ways AI is transforming international trade

10. Top 10 fastest growing international trade jobs in 2023

Top 10 fastest growing international trade jobs in 2023

As every year comes to a close we like to take a moment to look back at the key trade issues people were talking about – and therefore, reading about. It was another year of changes and uncertainty, which is likely why two of our most-read articles were about risk.

But it was also a year for plodding ahead and looking to a brighter future. People were reading about business planning, investment and negotiations in a changed global business environment.

What was also heartening to see was the interest in articles about investing in your personal and career growth. Two of our most-read articles were about career success and upskilling.

So without further preamble – here are the top 10 most-read articles of 2022. Read on, enjoy, and let us know what you think most people will be reading about in the year ahead in the comments.

1. 10 Global trade trends we’ll be watching in 2022

10 Global trade trends we’ll be watching in 2022

2. The most common forms of foreign direct investment (FDI), including ownership-based investments and investments based on strategic alliances

The most common forms of foreign direct investment (FDI), including ownership-based investments and investments based on strategic alliances

3. A Guide to Preparing an International Business Plan

A Guide to Preparing an International Business Plan

4. Identify and mitigate the 4 types of financial risk: commercial risk, foreign currency risk, country risk, and bank risk

Identify and mitigate the 4 types of financial risk: commercial risk, foreign currency risk, country risk, and bank risk

5. The 11 political risks that could sink your imports and exports

The 11 political risks that could sink your imports and exports

6. What should be on every bill of lading

What should be on every bill of lading

7. 5 Canadian Trade Commissioners talk about their career success

5 Canadian Trade Commissioners talk about their career success

8. Pros and cons of using subcontracting as a market entry strategy

Pros and cons of using subcontracting as a market entry strategy

9. Top 7 reasons to become a CITP according to CITPs

Top 7 reasons to become a CITP according to CITPs

10. 10 tips for negotiations in a virtual meeting environment

10 tips for negotiations in a virtual meeting environment

Whether you sell goods or services or both, there may be tremendous opportunities for you to grow your business outside of the domestic border. In fact, going global can make you more efficient, make you more competitive and make you stronger.

However, if exporting were easy, every company would do it, so it’s crucial to understand what’s involved.

During this series, we will provide an outline of some of the risks of going and growing globally, as well as a high level “A to Z” of exporting – everything from assessing your company’s export readiness to planning and researching market entry, finance and marketing.

FITT experts:

Daniel Lewis CITP, Founder – Daniel’s Chai Bar, Author, International Speaker

Marvin Hough CITP, President – MIRA Limited

Lora Rigutto Vigliatore CITP, Loyalty and Engagement Manager – FITT, International Business Instructor

Assessing your company’s export readiness

Feasibility of International Trade

When we talk about feasibility of international trade we’re principally referring to three broad components:

• Export readiness – does your venture have the resources required to venture into foreign markets?
• Choosing your target market – where should you start?
• Suitability of your products and services – is your product or service suitable for your target market, or do you need to modify it in some way?

The first step in assessing your export readiness is to do a SWOT analysis – you must assess your strengths and weaknesses and figure out your gaps.

The second step is asking yourself those tough questions – why are you exporting, who is going to get the work done, and are you really ready?

Daniel, can you tell us about your company’s journey to importing and exporting, and how you determined when you were ready to go global?

The thing I like to say is that we started exporting accidentally, and then we learned how to do it the right way, so a lot of what I learned was by mistake.

When we started our company, our focus was on how we could positively impact the community that we’re in, which was working. But then it got to a point where the people that we were impacting in our local market well, they have family that visits from international locations, and when they would experience our brand and our products we started to hear the questions like “do you ship to the U.S., to Australia, Japan?”

When you keep getting those questions then you start to ask, is there business potential elsewhere? That’s what started to happen for us. We started to sense a demand, especially from the U.S., for our teas and we had to start thinking about how to get it there. So we had to figure out packaging and how to ship it – what were the documents that we needed.

We made a lot of mistakes in those early stages, until we started to learn from those experiences and get our feet on solid footing.

We also started to learn that in the U.S., which became one of our big markets, it’s very different than Canada. People are different, the buying decisions and motivations are different, and we couldn’t just copy paste what was working with our Canadian market. Eventually we tapped into resources like FITT to learn and refine that process.

What were some of those gaps that you had to address before you could make that leap to a new market?

 One of the biggest gaps for us was, from our company’s inception, we branded ourselves as a company who uses tea as a tool to impact people’s lives in a positive way, so in our marketing we put our mission before our product. And that resonated very well here in Canada.

But when we went to an international market, like the US, they didn’t really know us, and that connection was not the same. We had to find a strategic way of turning that around and creating a product focus. It was the complete opposite of how we were branding and marketing ourselves originally.

Marvin, how do you assess or help your clients evaluate their own export readiness?

You know in Canada, we have about a million SMEs and only about 4% are actually exporting. And out of those about three quarters sell into the United States. Going global for an entrepreneur or startup SME is really challenging, but it’s also really There are three pieces of good news I want to share:

1. There are more groups available now to help entrepreneurs than ever before. FITT and Startup Canada are both excellent examples.
2. The digital revolution has created an easier path into markets.
3. Startups can be very flexible and agile and being able to pivot and change the way you’re operating is really, really important.

I put my clients through a readiness checklist that can be quite extensive. I’ll mention some of the points that I think are really important that companies look at. Number one is management’s commitment to the export field.

I’ve seen companies say they’re ready and they want to go at it, but two months later, they come back and another project has taken priority. To tackle international markets, companies have to be sure they’re committed from the very top.

The second part is foreign market research. You can do a lot of this online now, which makes this much more accessible.

Thirdly, having the financing setup and support is important, whether you have to adapt your products or just completing an order. So many companies I’ve seen are stretched too thin, and they’ve got an export order but they lack that risk management.

As you enter a market you’ll often be relying on an agent, partner, or distributor. It’s so important to do the full analysis and fully vet your partners.

There are many other items on the export readiness checklist – from getting the right freight forwarder to understanding the promotional material requirements in your target market.

A great resource I’ll point out is on the Trade Commissioner website  – there’s an export readiness quiz that you can complete to assess all these readiness factors.

And if you don’t have an answer to some of those questions, or the answer is no, then consult with consultants, and CITPs, and seek training resources like the workshops and courses provided by FITT. The Situational Analysis workshop and Feasibility of International Trade course in particular can help on the preparedness side.

EDC, is also a good resource for companies that are assessing if they’re ready to export.

But as mentioned, sometimes an export order comes out of the blue and all of a sudden there’s an order coming in from a new market. That can be an exciting and overwhelming situation, but it’s also a great learning experience because startups have the agility to learn and adapt quickly. Daniel and his company are a great example of that.

You’re never too small to start exporting, you just have to know where your gaps and tap into the right resources that can help you.

How do you determine which markets to start exporting to?

I caution companies to get focused on their target market and don’t take on too many markets at the same time. That can often be a recipe for disaster.

As mentioned, many companies start exporting to fulfill orders that have come to them through e-commerce or a random request in their inbox. But there can be a tremendously steep learning curve.

The vendor may not be set up to ship internationally and may not understand customs procedures or local requirements for labeling and packaging.

So, if we take that strategic approach to market expansion, are there certain types of markets that are good testing grounds for first time exporters?

Many Canadian businesses start their international expansion in the United States where there’s cultural affinity and we conduct business in similar ways.

One resource that comes to mind is called the New Exporters to Border States (NEBS) program run by the Ontario government which helps businesses who are exploring the U.S. market. If a company is going through the readiness stage, they can go to the U.S. for a two day program and get all of the details about crossing the border from currency exchange to tax and legal issues.

Through this program the businesses can gain that knowledge firsthand, they can for example, go to Buffalo for two days and meet with all of the officials who can help facilitate the logistics in that market.

There’s a plethora of information online through government websites here in Canada, and I find industry associations have really good information on foreign markets for companies looking at getting into a sector.

But then there’s always those unexpected orders that come and companies have to evaluate them. Having somebody focused on the research is very important, whether that’s an internal employee or engaging a consultant to do that.

Hiring a research consultant can be extremely important, in my experience, for a smaller company.

Daniel, you mentioned, you started your company’s exporting journey in the United States because of unplanned opportunities to fulfill orders from word of mouth.

Was exploring that market also a strategic choice or was it just because of that unexpected demand coming in?

I was not strategic at all, I was just reacting to those opportunities. And that’s a place you don’t want to find yourself in when it comes to exporting.

So often in business, you have this checklist and this plan, and then boom! Something else just side tracks it. That’s what happened to me in many cases, and I was not necessarily ready.

For example, I’m also an author and with my book sales, I said “I’m open to the world!”

I learned you have to be careful of just saying that you’re open to selling internationally, because I was selling my book for $9 and I got an order from Vienna. Long story short, by the time I shipped that and got it to the customer it cost me $85. It was either that, or they had to wait like five months to get the book.

Logistically for you, you need to know if you are entering the best market from a sales and marketing standpoint. Explore where there are trade agreements between your home country and that market or that country that you’re trading into.

We didn’t know about the HS codes that we needed to declare and put on our packaging, and we got hit so hard with this influx of information that we weren’t prepared for.

If I was to do it again, I would have found people who have experience – and I would have started with FITT courses and the Trade Accelerator Program.

These kinds of resources have helped to make me aware of the things that I don’t know about exporting and importing.  And that’s what I didn’t do before, so if I was to do it over again, making that commitment from a management standpoint to do the research, learn about the shipping logistics.

Start by getting training, attending workshops virtually, doing your online research, reading books – it will all make you feel so much more ready and give you a psychological confidence to start exporting.

Before I did that, I was getting to a place where I didn’t want orders to come in anymore, because I felt like I was just going to mess it up. But once you feel ready, you get more aggressive in doing business and getting sales and facilitating those orders. Then your customer service kicks in and that’s when business starts to thrive.

Something that sometimes happens when companies enter big markets – it’s that idea that a big country like the U.S. or Mexico is one market. It’s a fallacy, I’ve seen so many companies think that they’re into the market and really they’ve only got a little bit of a foothold in a particular city. We have to realize that there are difference markets within these big countries from region to region and different cities. That has to be explored as part of your analysis.

I’ve been teaching here at the Telfer School of Management and in the MBA programs in many universities. Within these types of programs the students often undertake international research projects for companies as a learning experience. These can be a sort of a free service, and a great resource that I would highly recommend to assist with your market research and analysis.

Stay tuned for the next article in the Ready. Set. Export. series – “Adapting your products and services”

Even when conditions indicate that a potential market might be suitable, certain political and legal issues—such as import restrictions or lack of copyright protection—could make the market less attractive. When trading with another country, organizations are directly influenced by the political, legal and business conditions of that country. A crucial step in deciding whether a new international market is a feasible one for your business to enter is to identify and analyze any possible political risks. The first step in analyzing political risk is to collect and review as much of the relevant data related to this target market.

Review historic and current data related to political risks

The following 11 potential political risks can be identified and evaluated through research:

1. Political instability: A country’s level of political instability is determined by the likelihood that its government will be destabilized or overthrown by violent or unconstitutional means, such as terrorism and civil war. This instability can include a rise in nationalism, civil unrest and labour issues. It can result in frequent changes to the legal requirements, destruction or appropriation of property or goods, inflation volatility, rapid price rises and a decrease in the quality of life for the country’s inhabitants.

2. Political cycle:  The timing of the election cycle may have a bearing on the launch of a new international trade initiative, especially if there is the potential of a change in the type of political leadership, such as from dictatorship to democracy.

3. Hostility to foreigners, foreign trade or foreign investment: Some countries openly welcome foreign trade and investment by offering incentives or beneficial tax reductions. However, in other markets, discriminatory legislation, trade barriers, “buy-national” procurement policies, quotas and tariffs are applied to foreign organizations.

4. Corruption and control over commerce: In some countries, control over commerce can lead to situations in which organizations feel pressured to befriend, persuade or even bribe officials in order to secure the permits required to conduct trade. However, gift giving and bribery can result in severe criminal and civil penalties.

International trade research helps identify markets in which organizations are likely to face trade barriers unless they or their representatives act in an illegal manner.

5. Weak legal protection for property and Intellectual Property rights: In countries with weak protection for property rights, there is an increase in black market activities (e.g. where illegal copies of products are being manufactured, distributed and sold in a foreign market with the consent of the intellectual property owner). Organizations are wary about investing in such countries because of the possibility of large property losses when property is stolen or misappropriated without recourse or when contracts are not honoured. Intellectual Property rights are also important. The degree to which Intellectual Property is protected influences the flow of innovative ideas and creation of new products in a  country, which impacts creative and economic wealth. Intellectual Property includes inventions, literary and artistic works and symbols, images, names and designs used in commerce.

Looking to determine if your new trade opportunities are viable? Check out the FITTskills Feasibility of International Trade online course!

6. Legal restrictions on trade: These restrictions can apply to both the import and export of goods and services.

In 2021, Pacific Gateway Holdings,  a  seafood  importer  in  British  Columbia,  was  fined  CDN  163,776  for  importing  endangered  eel  species  products  from  a  supplier  in  Xiamen,  China.  The  company  had  declared  that  the  shipping  containers  contained  American  eel,  but  five  of  seven  containers  that  were  inspected  were  found  to  also  contain  a  percentage  of  European  eel  meat  (which  is  not  legal for importation). The shipment, which was valued at roughly CDN  400,000,  was  also  seized  by  the  Crown  at  the  border  and  ultimately scheduled for destruction.

7. Legal requirements for business registrations, incorporation, local partnering or other types of  performance: Because a company’s legal structure has an effect on liabilities and taxes, it is important to consult with a tax accountant and legal expert to investigate each form of legal structure before making a decision. Organizations must also ensure that they adhere to all legal requirements and payments.

8. Tax regimes: Tax rates on identical items vary from country to country and sometimes even between regions within the same country. A country’s tax practices might be unusual or complex. If tax treaties between a foreign country and a company’s home country are not established, a foreign company might have to pay tax twice (i.e. they may have to report, and be taxed on, earnings in both countries).

9. Relationships with other countries: It is important that an organization is aware of the relationships the target market has with other countries, including alliances and conflicts. For instance, if an exporter sells a product to a country that is known to then trade that product to a country with international sanctions against trade in that product, the exporter may face legal consequences.

In 2021, Biomin America, a company based in Kansas, U.S., agreed to  pay  a  penalty  of  USD  257,862  to  the  Government  after  being  found  to  be  in  violation  of  the  U.S.  Department  of  the  Treasury’s  Office  of  Foreign  Assets  Control  (OFAC)  regulations.  Although  U.S.-based  companies  can  sell  food  to  importers  in  Cuba,  the  United  States  carefully  regulates  and  monitors  all  shipments  to  the  country  so  a  permit  is  required.  In  this  case,  the  shipments  to  Cuba  were  actually  made  by  subsidiaries  that  Biomin  America  owned  in  other  countries  and  the  goods  were  not  produced  in  the  United  States.  However,  since  the  companies  involved  were  owned  by  the  U.S.  parent  company,  a  permit  was  still  required,  and since it had not been obtained, the company was penalized.

10. Infrastructure failure: It is important to consider the potential of infrastructure failure for government-owned assets such as electric power and transportation.

11. Cultural misunderstanding: Organizations must always be aware of the potential for cultural misunderstanding in business dealings.

This information will have been collected in the research phase. An excellent source for this type of information are country reports, many of which are free or available at low cost.

Organizations, especially larger companies involved in complex trade deals, may also hire specialists in the political risk analysis to complete the research and target market analysis. These specialists provide reports and recommendations that inform business planning decisions.

It is critical that organizations identify the requirements of the target market and their own countries. Misinterpreting these requirements can lead to difficult situations – for example, you could be required to remove a product, such as veterinary products and live animals, from a foreign country that cannot be re-admitted to your own. Once  the  information  is  collected,  you can identify  the  key  areas  of  concern and measure the probability of occurrence of each risk and the potential impact your  business  activities.

This factor distinguishes them from indirect investments in securities, bonds, funds, or currencies. Understanding these different investment options is critical to researching which ones best suit a given organization, target market, and/or venture.

Ownership-based investments

One type of foreign direct investment is based on establishing an ownership position over an asset or assets. The following are some of the most common types of ownership-based investments:

Greenfield

The investing organization establishes a completely new operation in a target market, building it from the ground up.

Brownfield

Similar to Greenfield, this is an aggressive market entry strategy. Brownfield investments are an acquisition of existing facilities in the target country. Often this strategy involves some site remediation, such as the clean-up of soil chemicals.

Acquisition

The investor purchases an existing operation in the target market.

Joint venture

The investor identifies a partner with complementary capabilities, and they set up an entirely new operation in the target market, each of them owning a stake proportional to the value of their original contribution. The original founding organizations continue operations as entities distinct from the newly formed joint venture.

Merger

The investor identifies an operation with complementary capabilities, and the two organizations abandon their original distinct identities to join forces into a single, combined new firm. Situational Analysis

Looking to determine if your new trade opportunities are viable? Check out the FITTskills Feasibility of International Trade online course!

Investments based on strategic alliances

This is a category of investment in which resources are contributed directly but do not create a distinct asset. Usually, such investments create partnerships in which the relationship is the only real asset. Investments based on strategic alliances are as follows:

Supplier alliances

Many organizations are investing in stable long-term relationships with suppliers of parts, technology, equipment, or other key inputs. Such investments require more than simply entering into a long-term supply contract. In many cases, they involve harmonization of standards, agreements on quality control, and integration of manufacturing and delivery processes. In technology-driven industries, supplier alliances can include agreements to share research and development (R and D).

Research consortium

There is a growing number of organizations in particular sectors pooling their R and D efforts to improve their ability to face related challenges. In some cases, such consortia focus on developing common standards that allow products to interconnect and interact. In others, they organize something akin to a division of labour by apportioning research tasks to the consortium members best able to carry them out. This can be significant internationally if organizations from different countries bring different kinds of expertise into a relationship.

Co-marketing alliance

Some organizations enter into an agreement to market each other’s products or services as part of their own set of offerings. They do this to fill out product lines and to provide consumers with a comprehensive offering. When the two organizations operate in different countries, this type of arrangement allows one to sell its products in the other country without setting up its own marketing organization. Such arrangements are not cost-free; partners must invest not only in making the relationship work but also in costs such as relabeling and rebranding.

Co-production alliance

Just as organizations exchange marketing services, they can also exchange production facilities. Rather than shipping finished products to a distant market, an organization can enter into an alliance with a local manufacturer to assemble components or manufacture a complete unit according to original specifications. Again, this can be a cost-effective way of entering a market, but it requires an investment in the relationship as well as in the transfer of knowledge, skills, and design.

Bidding consortium

Perhaps the loosest form of strategic alliance occurs when organizations enter into a consortium to bid on a project that none of them could carry out individually. Such consortia are very common in large international infrastructure projects. Even though the organizations retain their distinct identities, entering into a consortium does require some longer-term commitments, especially if the bid is successful and the winners are obliged to work together for several years. The simple fact of participating in a bid can require a significant investment of time, human resources, and money, especially if bid bonds are required.

One of the most important skills to learn in business is negotiating. It’s an art that you must master to gain partnerships and clients, and conduct business well. However, when it comes to doing business with companies in other countries, or international negotiation, you’ll have to take your negotiation skills to a whole new level.

International negotiation can feel daunting and uncomfortable at times. One small, innocent mistake or misunderstanding due to cultural differences can jeopardize an entire deal. Fortunately, there are specific ways you can avoid these mistakes and prepare for international negotiations, so you can successfully close your business deal.

Educate yourself on the culture

Before you step into the meeting room to start negotiating with an international client or company, educate yourself on their culture. This world is beautifully diverse with different people and customs, and it’s important to be aware and considerate of them. Not only does this broaden your mindset, but it also shows that you respect others when you acknowledge their culture.

The first things you should learn are their traditions, etiquette, mealtime rituals and customs, greetings, and overall mannerisms. This is especially important when enjoying a business meal or hopping on a Zoom call with an international client, as some things that may be traditional in your culture are seen as offensive in others. Knowing this essential information will put you far ahead of other businesses dealing with international relations.

Learn more about conducting business in international markets with the online FITTskills course Feasibility of International Trade.

Body language does most of the talking

Have you ever noticed that you can tell when two people are arguing or upset with each other even if they do not understand what they’re saying? This is because we can read their body language and understand the emotions they’re feeling.

You may be surprised to learn that most of our communication is done through body language. How we hold our hands, the expressions on our faces, and even how far we stand apart from someone can hint at how we are feeling.

According to Dr. Albert Mehrabian at UCLA, 7% of our communication is done through spoken word, 38% is through tone of voice, and 55% is through body language. Studies have also shown that people who are more animated when they speak, such as those who use their hands or put up their fingers when talking about numbers, retain people’s attention longer.

Since body language is our main form of communication, it’s essential to learn about certain gestures and mannerisms of the culture you’re going into international negotiations with. A simple gesture in your culture may mean something completely different to other cultures.

Mastering microexpressions

Microexpressions are a universal way of communicating through body language. Darwin first noticed these involuntarily facial expressions and across different cultures. It was Dr. Paul Ekman who then proved Darwin’s theory and found the display of emotions such as anger, fear, disgust, happiness, sadness, surprise, and contempt were the same for most people.

Understanding and identifying these microexpressions can make international negotiating much easier because of their universality. Pay attention to your counterpart’s face and keep an eye out for these microexpressions while negotiating for insight as to how they’re feeling.

Handshakes 

In most cultures, handshakes are used when first meeting someone or at the start of a business meeting. However, the type of handshake and the rules around them differ.

A firm handshake is preferred in the US, Canada, and Brazil, while in Europe and Asia, a looser handshake is often used. In Turkey, firm handshakes are actually considered rude.

It’s also important to note that women in Australia generally do not shake hands with other women, and women and men generally do not shake hands in Islamic cultures [1].

Personal space

The distance between two people is also different depending on the culture.

North America, Northern Europe, and Asia tend to keep a further distance and have less contact with people. Those in Southern Europe, the Middle East, and South American prefer standing closer together and having more contact.

Eye contact

If you’re a seasoned negotiator, you know just how important eye contact is when speaking with someone and know you must balance just enough eye contact. In fact, some cultures in the Caribbean view too much eye contact as aggressive.

A good rule of thumb is to maintain eye contact 50% of the time when you’re speaking and 70% when someone else is speaking.

Politely probe for more information

While body language greatly contributes to communication, speaking is just as important. Even just the tone of our voice is important to consider when negotiating with international clients. Some cultures tend to speak softly and maintain calmer conversations, while others, such as Italians, tend to talk at a higher volume and interrupt each other.

While how you probe depends on where you are and to whom you are speaking, asking questions is an essential phase of negotiating as it is the most impactful way to gain insightful information from your counterpart. It will help you discern their needs and thoughts. Not to mention, doing so gives the other side a platform to speak, which is a great way to build relationships.

Prepare your questions ahead of time and be sure your questions are appropriate to ask in their culture. A quick rule of thumb is to start broad, flush out all the key aspects of importance to the other side before you dig into a specific issue, and try to use open-ended questions whenever possible.

Concluding your negotiation

The end goal of any negotiation, international or domestic, is to reach an agreement that benefits both parties. Before entering the negotiation, have an idea of what your end goal is; what will be the outcome if your negotiation is successful or not?

Be strategic when you propose your offer. A quick tip is to be specific with your numbers as that indicates to the other side that your offer is well thought through. And, avoid ranges, as the other side always hears the side of the range that is most advantageous to them.

Become successful at international negotiation

International negotiations aren’t easy, but you will be more successful if you prepare for them. Ultimately, in any situation, the best negotiators are those who are well-prepared; they ask insightful questions and propose solutions that maximize their share but still satisfy the other side. In international negotiations, you just need to add an additional step of preparation to demonstrate respect for the other party. Do this, and you will find negotiation success.

Learn how to accurately determine if your business is prepared to venture into new markets with the online FITTskills workshop Situational Analysis.

[1] Lares, Cochran, and Digan (2021). Persuade: The 4-Step Process to Influence People and Decisions, Wiley, 161.

Trade-related organizations play a critical role in ensuring the viability of businesses all around the world. They set and create needed median standards for all trade professionals and the broader business community. This community benefits from the comprehensive and strict oversight in regards to rules, laws, regulation and access to trade and business-related resources.

The Forum for International Trade Training (FITT), for example, has developed global competency standards for the knowledge and training required to succeed internationally, supported by educational credentials and the CITP®|FIBP® professional designation. In this way, we ensure that professional standards and educational resources are always relevant and current for the changing needs of international trade.

In the same way that our organization creates fair and formalized standards and processes for trade training, other trade organizations set standards for the global community in a broad range of other categories. Most people recognize the names of the organizations such as the World Trade Organization (WTO) and the International Monetary Fund, but may be surprised to find out that there are many others.

What are the other key organizations that international businesses and business people should be aware of and how exactly do they govern trade and impact international businesses?

To help answer these important questions, we’ve compiled a quick guide to international trade organizations that touches on some of the most important players and how they influence international trade and business ecosystems. Here they are:

World Trade Organization

Since 1994, the World Trade Organization (WTO) has worked to maintain open lines of communication regarding international trade with its 164 member countries. It oversees existing trade agreements, ensuring that countries are upholding the terms of their agreements, and also helps settle disputes about those agreements.

The WTO also helps countries negotiate and forge new agreements, and it calls out unfair trade practices. With its current membership, the WTO serves all major world economies. Through the WTO, international businesses and organizations can find data and regulatory information related to trade.

International Monetary Fund

While the WTO focuses on supporting the international economy by facilitating trade, the International Monetary Fund (IMF) focuses on establishing sound monetary and economic policies to support the global economy. To do so, the IMF monitors economic policies within its 190 countries to identify potential risks and provide advice. IMF also issues loans to countries to help stabilize economies and provides training programs that help countries modernize their economic policies and workforces to spur economic growth. The IMF also upholds the system that allows for foreign monetary exchanges.

World Customs Organization

The World Customs Organization (WCO) brings customs officials from around the world together to work toward making customs processes easier to navigate for international businesses. It also influences the WTO’s rules of origin and customs valuation processes. International businesses may recognize the work of the WCO through the Harmonized System—the numeric system that is now used by more than 200 countries to help code and classify internationally traded goods.

International Chamber of Commerce

While the above organizations deal with world governments,

the International Chamber of Commerce (ICC) represents companies that do business on an international scale. The ICC seeks to promote the free trade of goods internationally. It advocates on behalf of businesses to the WTO, United Nations and other organizations that affect international trade and business.

Organizations for trade development, trade law, sea and air transportation and economic funding

There are many other organizations that enable international trade and support businesses that trade globally. The United Nations Conference on Trade and Development (UNCTAD) helps developing countries find entry points to international markets, and the United Nations Commission on International Trade Law (UNCITRAL) brings nations together to modernize their economic policies and workforces to spur economic growth.

For shipping companies, the International Maritime Organization and the International Air Transport Association provide guidance and support to marine and air logistics companies, respectively. Meanwhile, The World Bank seeks to reduce poverty globally by offering loans and other support to developing nations.

All of the organizations that impact global trade play specific roles in creating a healthy international economy. While they are all separate, they also coordinate their efforts and support one another to reach their common goals.

Want to learn more about international organizations and business law? Read our article The role of international organizations in international business law.

As many businesses begin their recovery efforts, a cascade of questions are top of mind. This is new territory for everyone. Where are the opportunities for growth and expansion? How do you approach business development? What should my recovery to growth plan look like?

To answer these questions we turned to a team of diverse experts in last week’s #TradeElite Twitter chat. Their insights were informative, practical and inspiring. Read through their responses below.

Topics covered:

• New global business landscape: changes in policy, market access, disruption
• Today’s opportunities for global growth
• Latest digital tools for global business 
• Global business recovery -> growth action plan
• Restarting business development efforts
• Biggest lessons learned that businesses can use to protect their futures
• Future global growth opportunities

Panelists:

Rad Dockery @Rad_Dockery Chief Innovation Officer, Unifai Solutions

Amy Karam @AmyKaram Founder, Global Competitive Strategy Consultant, Karam Consulting, and China Trade Expert

Craig Atkinson, CITP @CraigAAtkinson Trade, Technology and Sustainable Development Specialist, Founder of Lexmerca International Trade

Paula Greene, CITP @PaulaIntlMkt President & CEO at BEYOND Ventures Group Inc., Export Entrepreneur and Business Developer

Bernadette Fernandes @On_the_Varanda Global Connector – International Trade & Development, Founder & CEO of the Varanda Network

What is the “new global business landscape” we are looking at today? What has changed in terms of policy, market access, and disruption?

Q1. EDC forecasts global growth at 1.6% in 2020—the worst performance since 2008, they expect a substantial increase to 5.3% in 2021. We need to be in the forefront. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

A1: Much has changed on the #policy front. @WTO #TFA came into effect over 2 years ago. #Tech for #trade is proliferating. Cost-effective and rapid movement of goods can have as much to do with a product’s #data as with a product itself. #TradeElitehttps://t.co/HsNwhsAwGT

— Craig Atkinson (@craigaatkinson) June 25, 2020

Clearly, #COVID19 has altered the global landscape significantly. As the level of infections varies across our major trading partners. And in emerging markets. #TradeElite

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A1: it’s the new old… not the recent but the very old, where travel was a tool for international trade. All has changed but not all bad. Policy is being adjusted; market access is now based more on existing relationships/networks; disruption is everybody’s business #TradeElite https://t.co/VTVGwkY3z0

— bernadette fernandes (@on_the_varanda) June 25, 2020

Trade diversification is being highlighted as a necessity not a novelty. #geopolitics rule and companies cannot afford to be dependent on the cheapest or low hanging fruit option #tradeelite https://t.co/1Px5iAC6Ft

— Amy Karam (@AmyKaram) June 25, 2020

We are also seeing more nations become more nationalist when it comes to procurement. The global Supply Chain is being questioned. As we see in Japan, where they put away substantial amt of funds for Japanese firms to diversify away from Chinese based Supply Chains #TradeElite https://t.co/2LM8XnrCCL

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A1: Disruption caused by the pandemic is forcing the digitalization of #trade faster than expected. Non-evidence based policy / protectionism is hurting some of former leading nations. Fragmentation and convergence are norm. Tariffs in the media, but NTBs are problem. #TradeElite

— Craig Atkinson (@craigaatkinson) June 25, 2020

Market access has also changed. For instance, we had to cancel a couple of trips to @ASEAN due to Covid19. And to adjust the service delivery model for a project. Remote work plus remote access to critical data infrastructure is new for many emerging markets. #TradeElite # https://t.co/2LM8XnrCCL

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

…and that impacts the trust factor that is very important for #emergingmarkets customers #tradeelite https://t.co/5MCAeBKLsr

— Amy Karam (@AmyKaram) June 25, 2020

Lots of interesting insights coming in already. We’re hearing that:
Policy has been changing a lot over last few years
Tech and data are huge for supply chain efficiency
Diversify, as political climate is changing
Disruption everywhere#tradeelite

— FITT (@FITTNews) June 25, 2020

Very broadly, for businesses that may be in recovery mode, where are the opportunities for growth today?

A2: opportunities are where you create them 1) develop a growth plan as you may have to abandon recovery; 2) implement the plan… slowly and wisely; 3) have check-points often to ensure the opportunities are still in your line of sight… you may have to shift/pivot #TradeElite https://t.co/Ao9Sy8YSj6

— bernadette fernandes (@on_the_varanda) June 25, 2020

There are many opportunities. But first, organizations have to ask themselves are they truly ready? Do you have not only the technical/business but the CULTURAL ability to perform in a Global Market. #tradeelite #BussinessGrowth #globalbiz #cdnbiz @CanadaTrade https://t.co/ccO6RcbxeH

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A2: Opportunities are in the #knowledge based industries #tradeelite https://t.co/9XGBLnGoGy

— Amy Karam (@AmyKaram) June 25, 2020

A2: The opportunities for growth are in new markets. Diversification must also be top of mind when considering lack of response in some countries to pandemic/natural disasters. Canadian ?? business needs to think about non-traditional #markets and #trade partners. #TradeElite

— Craig Atkinson (@craigaatkinson) June 25, 2020

#DigitalTransformation which has been mainly an overly used term, is now being taken more seriously. And it has many elements! From Skills, culture, management, politics, finance and obviously Technology #TradeElite #businessgrowth #Globalbiz #cdnbiz https://t.co/ccO6RcbxeH

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A2: If you are looking to export markets, look at where they are in flattening the curve, those experiencing high incidences may not be receptive. Where they are recovering , an opportunity #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

We also have found that Supply Chain visibility has become a huge issue. This applies domestically and globally. If one offers products/services that can improve #SCM visibility, there are opportunities. #TradeElite #businessgrowth #globalbiz #cdnbiz https://t.co/ccO6RcbxeH

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

Looking at innovative ways to deal with #inequality is also an opportunity. #Covid19 has underlined how many global citizens are on the edge. We have received calls from West / East Africa on this topic since we won our deal in Indonesia #TradeElite #businessgrowth #globalbiz https://t.co/ccO6RcbxeH

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

Forrester’s analyst Joana de Quintanilha said that companies should be measuring the customer journey to listen to their needs all along the buying process, and she mentioned Customer Effort Score for that purpose, for example, and constant micro-surveys. #TradeElite #globaltrade

— Sandra Cravero | 4/5 replies from ? marketing (@sandracravero) June 25, 2020

Where are the opportunities for global growth? We’re hearing:
?Knowledge-based industries
?Collaboration
?Digital tools/transformation
?New markets who are flattening the curve #COVID19 #TradeElite
Are we missing any?

— FITT (@FITTNews) June 25, 2020

We are hearing a lot about technology applications. What are some of the most relevant digital tools that can give global businesses a competitive edge?

A3: technology applications are a dime a dozen, too many to mention with #DigitalTransformation; it’s no longer about the tools but about how quickly and effectively you can adopt, integrate and transform for competitive differentiation #TradeElite https://t.co/ZUXB8xFuwe

— bernadette fernandes (@on_the_varanda) June 25, 2020

A3: The most relevant digital tools that can give global businesses a competitive edge – the tools easily used by your customers and the target market. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

A3: On the research front, can’t beat @ITC_MktAnalysis tools. Otherwise, #singlewindow platforms req. under @WTO #TFA is helping traders to more efficiently comply with rules of different ministries (eg #customs + #ag). #Paperless #trade #TradeElite https://t.co/NIQDtKfQXn https://t.co/zijlsptwwl

— Craig Atkinson (@craigaatkinson) June 25, 2020

A3. Familiarize yourself with multiple platforms, make it easy for your prospective client. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

An internal data strategy is key. What your sweet spots? Where have you and where can you deliver the most value. Internal data analytics here is crucial. Don’t guess at what you are good at. KNOW IT! #DataAnalytics is CRITICAL! #tradeelite #globalbusiness #cdnbiz https://t.co/vDk6XLF0Mj

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A3: that’s bang on @PaulaIntlMkt , can’t go wrong being customer centric even when it comes to digital and especially our own competitive edge! #TradeElite https://t.co/JFbphEBu3s

— bernadette fernandes (@on_the_varanda) June 25, 2020

Building secure 2/3 way platforms will also allow more seamless interaction vs. only email. This is where technologies like #smartcontracts may finally take off. #digital #tradeelite #globalbusiness #cdnbiz https://t.co/vDk6XLF0Mj

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

What are the best digital tools for global growth?
We’re hearing:
?No specific tools effective adoption
?Internal data analytics
?Tools that help your customers
?Agile inventory management
?3BL framework
?@ITC_MktAnalysis tools
?#singlewindow platforms #tradeelite

— FITT (@FITTNews) June 25, 2020

What should be included in every global business’ recovery -> growth action plan?

A4: top of my list to include is a new business mentality, an attitude shift to recovery, from survive mode to thrive mode; but also a coming to terms with the fact that you may not be recovering but rather pivoting, developing a completely new action plan for growth. #TradeElite https://t.co/Lz0qzxOMPo

— bernadette fernandes (@on_the_varanda) June 25, 2020

A4. Research, vet and validate your prior business plan either confirm information pre #COVID19 or plot a new direction. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

BUSINESS CONTINUITY PLANNING!!! You can’t grow if you can not demonstrate how you will handle an unexpected event. Our own internal process here has become part of the narrative we share with clients! #tradeelite #globalbusiness #cdnbiz https://t.co/29BUsmirnz

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A4: Incorporation of #contingency plans, regardless of potential added costs. e.g. #supplychain #diversification, #economic security by widening reach of #customerbase. Long-term #growth plans and investments vs. short-term wins #TradeElite https://t.co/pURFXji7a8

— Amy Karam (@AmyKaram) June 25, 2020

Cultural awareness and sensitivity. At first I bought a N. American attitude to trade. and failed badly! Respecting culture is critical for growth planning. Because that builds trust and personal relationships! #tradeelite #globalbusiness #cdnbiz https://t.co/29BUsmirnz

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A4: How to ensure the safety of employees as they move forward. #TradeElite

— Craig Atkinson (@craigaatkinson) June 25, 2020

It is critical to team up with External Experts. We have some on this thread who can help you grow your global business! This can save you time and money. And help you really focus on your sweet spots! #tradeelite #globalbusiness #cdnbiz https://t.co/29BUsmirnz

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A4. Analyze what is happening in your sector, some sectors have been continuing to work as before and are struggling to procure supply. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

A4: Remember when we all had disaster recovery plans? Wait, you’re not as old as me but either way, now it’s not even a #hashtag bring back #DisasterRecovery #TradeElite https://t.co/sSSlUDDmQX

— bernadette fernandes (@on_the_varanda) June 25, 2020

What advice do you have for global businesses looking at restarting their business development efforts?

1) Don’t be afraid to ask for help! We have failed and slipped up many times. Ask for help from @TCS_SDC and engage your team. Also get your news from sources outside of our home base. #tradeelite #globalbusiness #cdnbiz https://t.co/ZQQ3Og5k3t

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A5: start at the beginning, before you went global, because everything, even where you go & grow is different now. If you’re restarting you have a head start, & lots of tweaks; If you’re pivoting/starting fresh, then go back in your mental archives to how you started #TradeElite https://t.co/7RIiMcKLKv

— bernadette fernandes (@on_the_varanda) June 25, 2020

2) Be honest.. If you can’t hire someone who will be honest for you :-)… What are you really good at? What does firms actually need? Can you offer it at a good price and be profitable. U have to be brutal honest! #tradeelite #globalbusiness #cdnbiz https://t.co/ZQQ3Og5k3t

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

A5: Diversification is key for businesses that are already global and looking to restart their business development efforts. #TradeElite https://t.co/2FWOLRnijQ

— Craig Atkinson (@craigaatkinson) June 25, 2020

A5. Don’t stop! Reach out now. Look for alternate paths, channels, or contact information due to offices that may be closed. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

What are some big lessons from this crisis that businesses can act on now to protect themselves in the future?

A6: my biggest lesson was to expect the unexpected, and by expect I mean prepare for the worst: build a business continuity plan for the worst crisis that you CAN’T even imagine; then put in mitigating measures with several checkpoints to ensure you’re still protected #TradeElite https://t.co/KZ3tPMUIcR

— bernadette fernandes (@on_the_varanda) June 25, 2020

A6: I’d say #digital is key. Administration can be simplified, but transferring and storing #data has consequences now. Be familiar with your market’s rules (e.g. #EU member countries). #TradeElite

— Craig Atkinson (@craigaatkinson) June 25, 2020

A6: Rethink your #strategy to be more long term focused and incorporate #geopolitical #risk considerations in your business plans. #TradeElite #globaltrade https://t.co/xjdgZZCcO1

— Amy Karam (@AmyKaram) June 25, 2020

A6. Look for avenues, how competitive are you to customers in countries seeking to diversify import dependence, Stabilize their supply chains, seeking substitutions for current supply.#TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

1) Business Continuity Planning is a MUST!
2) #DigitalTransformation must start NOW!!!!
3) Businesses must be able to deliver anytime/anyplace
4) Economic and Social Inequality is even a larger problem than many of us realized. #tradeelite #globalbusiness #cdnbiz #SDGs https://t.co/0J2fTjovvi

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

With #DigitalTransformation – you can turn Data into information!!! #Digital… #Digital.. #digital.. with respect for culture.. And Canada should absolutely kick you know what on this topic! #tradeelite #globalbusiness #cdnbiz https://t.co/0J2fTjovvi

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

Lastly, businesses need to re-evaluate every single vendor/partner. What are they doing to become more digital? Do they engage diverse voices in a global economy.. Or are they still operating as if nothing changed. #tradeelite #globalbusiness #cdnbiz https://t.co/0J2fTjovvi

— Rad Dockery ??? (@Rad_Dockery) June 25, 2020

Crystal ball time! Where do you see more growth opportunities in the near future?

A7: I think growth will occur in products and sectors that are “sustainable”. If anything, the pandemic and natural disasters have shown how fragile the whole system is. #TradeElite

— Craig Atkinson (@craigaatkinson) June 25, 2020

A7: One word; one continent… Africa! Personally, I see growth happening in markets that are unfortunately used to being resourceful, responding to crisis, before it happens. Africa gets growth; they’re ready for diversification; they’re ready for Trade & Investment #TradeElite https://t.co/k3bVi88R6w

— bernadette fernandes (@on_the_varanda) June 25, 2020

A7. Define the best approach, look at opportunities, adjust to adapt new practices, perhaps as part of your corporate social responsibility practice, pivot and optimize your efforts. #TradeElite

— Paula (Lunn) Greene (@PaulaIntlMkt) June 25, 2020

Read the rest of the chat and join future discussions by following the #TradeElite hashtag. And stay tuned for the next #TradeElite chat, coming up Thursday, July 23 at 2:00-3:00PM ET, and if you haven’t yet, join us on Twitter at @FITTNews.

In our current trade environment, trade wars will increase costs to the consumer, and the risks for employers, shareholders and employees of cross-border businesses. However, what will remain unchanged will be Canada’s need to generate our standard of living through success in the global marketplace. Current customers need to be retained and new ones found. Input cost changes will require significant creativity to preserve trade flows and margins.

Canadian politicians and economists have been talking for a very long time about our over-dependence on the U.S. market and the need to diversify. The diversification message coming from the Canadian government to businesses today has a special note of urgency, reflecting the risks which are being added seemingly daily for cross-border businesses.

And there’s been all kinds of attempts over the years to encourage Canadian companies to look elsewhere. Well, now you have a circumstance in which our best market, the United States, may become less attractive as a place to do business. This should provide Canadian corporations with an opportunity to reassess where else in the world their products can be marketed, products and services.

Companies can’t diversify their global markets without the right tools

We’ve got to turn this to our advantage. This is a real moment in time for Canadian trade and organizations striving to do cross-border business.

We know that knowledge preserves margins. Knowledge is power in all human activities, but particularly so in international trade. Market intelligence translates directly into market power. Value-added exports create higher margins the closer the producer gets to the customer. Availability of information is therefore critical to export growth, sustainability and job growth in a supplier’s jurisdiction.

The Forum for International Trade Training (FITT) and Export Development Canada (EDC) are heavily involved in efforts to grow the number of small businesses taking advantage of opportunities in the global marketplace through upskilling and building international business know-how.

As more people take FITTskills courses, their businesses will be increasingly prepared to make the risk calculations necessary to do the business and preserve their margins.

But this is also the perfect opportunity to refocus the way trade promotion services (TPO), such as the Canadian Trade Commissioner Service and private sector advisors, have been relating to their client base.

Trade promotion organisations and advisors need to give businesses what they really need – qualified leads

Look to TPOs like Saskatchewan Trade and Export Partnership, who are doing it right! Their number one deliverable to their Saskatchewan member companies are qualified trade leads.

Provide the qualified international leads to local businesses that are prepared and interested in doing a transaction. This is very difficult work. It’s far easier to do a speech to a chamber of commerce talking about how the GDP in Costa Rica has gone up 6.4% last year. Frankly, businesses don’t care about that. What they care about is who in Costa Rica is buying what I’m selling.

When I was an ambassador to the Philippines, we had the Asian financial crisis in ’97-’98. I went to a meeting of our ambassadors from around Southeast Asia and many people were despondent that the region would no longer be a priority market for Canada. I asked, “What’s the problem? Indonesia hasn’t stopped. Imports haven’t stopped. There may be fewer customers now, but go and identify some new ones.”

These guys were all tied in up in the idea that if you’re not a priority market, then you’re not quite as good. We don’t need priority markets. Canadian business needs customers and partners.

Serving businesses by thinking like one

Trade advisors and trade promotion services need to think more like the small businesses they serve and less like economists.

A major impact of the internet has been the facilitation of direct connection between buyers and sellers all over the world. Thanks to cyberspace, more customers are now in touch with more suppliers than ever before. A larger portion of Canadian companies became active and successful in international trade through the receipt of an unsolicited request for their product than you might think. One day, somehow, somebody heard about their product who wasn’t in Canada, and they became “accidental exporters.”

So, rather than establishing and promoting priority markets and sectors, TPOs and advisors’ priorities should instead concentrate on the selection of strategic services that will be offered to any qualified client.

Let’s leverage our assets to mitigate common exporter challenges

Classic trade promotion programs remain very important to the success of national economies in the global marketplace. Focused, targeted offshore marketing strategies work well. If exporters are to sell on something more than price, quality must be anticipated by a customer before it is experienced.

Similar challenges face exporters in every country:

• Need for a healthy and growing customer base
• An absence of support organizations in their communities
• Need to understand new markets, domestic and foreign
• Lack of skilled international trade practitioners in the economy
• Shortage of time to pursue opportunities over the horizon
• Low level of understanding in the community of how integrated local business has become in the international economy

We have the assets to facilitate global business:

• Young, highly educated professionals whose talents are at a global standard
• Access to the internet and global television news
• Access to global support organizations ex: logistics, standards, design, etc.
• Access to telecommunications and air connections enabling anyone to be anywhere in a day
• Access to public resources devoted to economic development initiatives (international and domestic public sector resources)

Public sector resources devoted to addressing these challenges, or capitalizing on these assets tend to be wasted when trade advisors endeavour to determine, rather than facilitate, the direction of the economy. The role of government advisors should be to leverage the efforts of the business community. Best practice dictates, therefore, that all advisors and service providers both public and private should apply resources to save the exporter time and effort.

Measures of success for trade advisors

Without the effective intervention of TPOs and advisors, business will still happen. But exporters, particularly SMES and those new to cross-border business, will be less equipped to handle challenges in the global marketplace, and will yield margins to someone in the process (customers, agents, or distributors).

How can TPOs and advisors measure success in their efforts to equip businesses to go global? Focus on the creation and impact of deliverables. For example:

• Capture the number and measure impact of qualified business leads to client companies
• Measure the number, and impact on corporate behaviour, of market research reports
• Track the retention and growth of the TPO or consultant’s client base
• Track client participation in trade fairs, missions, conferences and other events and document feedback

These are relatively simple measures, but they are effective. The challenge is to demonstrate real value to SMEs who have the potential to become clients and, in turn, successful exporters.

Help for business new to trade

Another challenge SMEs and organizations new to trade face is the overwhelming number of public and private organizations offering solutions. How do they know where to go? Overlap, duplication, scattering of resources and ignoring real areas of need are all too common within these organizations. Emphasis must be placed on cooperation and coordination between agencies focusing on economic development and reducing anxiety at early stages of development.

The key driver in the domestic and international support networks can and must be the TPOs and export advisors. They are in a unique position to:

• Create and drive the vision behind the national export strategy
• Make visible the current and potential impact on international trade on the economic wealth of the nation
• Identify and build the trade support networks which serve the needs of exporters
• Translate demand from the global marketplace into transactional market intelligence delivered to interested and active export companies

Trade advisors must lead the effort to create cross-border support networks that are driven by vision, designed by the private and public sectors, and guided by performance measures. The measures chosen have to impact the daily work of all involved.

The unfortunate truth is that no trade agreement ever created a direct job, except perhaps for the negotiators. Jobs are created when suppliers identify and satisfy buyers or visa versa. The needs of business are universal: qualified business leads, competitive intelligence, contacts with key decision makers and data on technical standards.

Equipping exporters with the knowledge they need to qualify customers and understand the competitive forces at work the will translate directly to more success and the higher margins.

Organizations have traditionally considered followed a target market’s laws to be sufficient due diligence. However, as many companies now produce their products or source their services in one country, and then sell them to customers in another, they are increasingly under public scrutiny and face social risks to their reputation.

Social risk arises from negative perceptions of an organization’s impact on the community. The social risks of a venture depend on the specific issues associated with an organization’s operations, the industry sector and the geographic context. Risks typically include environmental pollution, hazards to human health, safety and security, and threats to a region’s biodiversity and cultural heritage.

Social risk is characterized by four components in combination: an issue, a stakeholder or group of stakeholders, a negative perception about an organization, and the means to do damage.

Want to learn more about how to analyze and plan to mitigate risks caused economic, social or political circumstances? Check out the FITTskills Risk Analysis and Management online workshop.

Social risk is characterized by the following components:

1. Issue: Societal and environmental issues are taking on heightened significance on a global level. The issue is specific to the organization, the target market and the planned ventures.

2. Stakeholder: For social risk, stakeholders are a broad group that includes any person or group who may have an interest in the issue. For instance, Nike now engages with environmental organizations, human rights groups, students, colleges, trade unions, socially responsible investor groups and academia, in additional to traditional stakeholders like shareholders, employees, customers, and suppliers.

3. Perception: Stakeholder perceptions are based on various information sources, including official news media, the Internet, word of mouth and the organization itself. Negative perceptions are more likely to arise in the absence of regular information or communication from the organization itself. Negative perceptions can be accurate or inaccurate; both can lead to challenges for the company.

4. Means: A stakeholder may possess a variety of means to affect organizational conduct. Small grassroots non-profit organizations may be able to mobilize large networks of allies very quickly.

Managing social risks through corporate social responsibility (CSR)

Management and mitigation of social risk factors are increasingly important for business success abroad. The costs of losing that social licence, both in terms of the organization’s share price and the bottom line, may be significant.

Ignoring social risk factors can lead to significant negative consequences to an organization’s reputation and operations. With no mitigation plan in place, these organizations have been subject to bad publicity, consumer boycotts and other negative outcomes. The advent of social media has had a large influence on how quickly these negative consequences can be realized and spread.

As organizations take advantage of global opportunities, there is a growing understanding that it makes good business sense to incorporate responsible business practices into investments and operations abroad; these practices also benefit the local economies and communities.

When organizations operate in an economically, socially and environmentally responsible manner, and they do so transparently, it helps them succeed. This is accomplished through encouraging shared values and social license with clients, customers and stakeholders.

In most cases, organizations can take steps to mitigate these risks. Some organizations have successfully mitigated these concerns through a range of activities classified as corporate social responsibility (CSR), which covers all of the voluntary actions a company can take to operate in an economic, social and environmentally sustainable manner.

Popular CSR steps include building closer relationships with local partners and stakeholders, increased transparency and public reporting, closer monitoring of suppliers and others in their supply chains, abiding by voluntary international standards for environmental emissions or labour rights, and ethically obtaining the rights to purchase or use any land.

Evaluating your business’s Triple Bottom Line

Social risk is also tied to the idea of Triple Bottom Line (TBL). TBL is an accounting framework that incorporates three dimensions of performance: social, environmental and financial. This differs from traditional reporting frameworks that focus exclusively on economic or budgetary performance. The TBL dimensions are also commonly called the three Ps: people, planet and profits.

The TBL, and its core value of sustainability, has gained traction in the business world due to accumulating anecdotal evidence of greater long term profitability. For example, reducing waste from packaging is good for the environment and it can also reduce costs. Among the companies that have adopted this approach are General Electric, Unilever, Proctor and Gamble, 3M and Cascade Engineering.

Over half of the global Fortune 500 companies and almost half of Standard & Poor’s (S&P’s) 100 companies now issue TBL reports. Investors incorporate these reports into their own measurements for valuing companies.