Attacks on cargo ships in the Red Sea in recent months have caused vessels to reroute around the Cape of Good Hope in Africa, producing longer and costlier trips. Happening simultaneously, the lower water levels along the Panama Canal have limited the number of cargo ships that can pass through the waterway each day.

Supply chains were also rattled not so long ago with the collapse of the Francis Scott Key Bridge in Maryland, which meant other U.S. ports had to step up and take on the shipping activity that the Port of Baltimore normally manages. There has also been a reported shortage of truck drivers stateside.

With all of these external factors in play – from public health crises to weather patterns to political discord – how can we protect our supply chains and – dare we say – even improve the relationships among selling and buying partners?

Export factoring.

Export factoring is a strategic tool to ensure cash flow

Trade finance is a set of financial tools that both improves a business’ cash flow and reduces its credit risk. Two well-known types of trade finance products are export factoring and supply chain finance.

Export factoring is when a financial firm buys a company’s receivables and advances them the majority of the invoice amount up front in cash (up to 90% in some cases).

This type of funding can also include credit protection and collections services. When this is the case, this full package is known as non-recourse export factoring.

Though manufacturers tend to choose export factoring services and retailers initiate supply chain finance with their suppliers, both umbrellas of trade finance achieve the same goal: better access to working capital all along the supply chain. A reliable source of working capital is critical to keeping operations moving along, despite any headwinds in global trade.

The waiting game

In today’s global trade landscape, there is often a wide gap between when an invoice is issued by the seller and when payment is submitted by the buyer. This is normal, though it can be a strain on supplier cash flow.

Payment terms between buyer and seller can be up to 3 months in some cases, meaning buyers don’t have to settle their invoices until 90 days after they have placed their order.

In fact, according to The Hackett Group, it takes large U.S. buyers an average of 54.7 days to pay their bills.

Factoring cuts this waiting period and converts unpaid invoices into cash up front. This method can be looked at as a “win-win” for both the supplier and the buyer, since the supplier receives additional liquidity right away while the buyer can enjoy extended periods until payment is due.

Why does getting cash right away matter to a supplier?

Well, in short, suppliers have vendors to pay too, and they can’t do so on schedule without sufficient capital on hand. By releasing the capital locked in their receivables, suppliers can pay their vendors in a timely manner, respecting these vital relationships needed to procure raw materials so they can continue to fill orders smoothly.

Besides paying their bills, manufacturers can also be looking to grow or expand their operations and customer base, which requires enough working capital to achieve these business goals. Many of these new buyers in new markets are also looking to negotiate longer credit terms, an arrangement that is attainable with trade finance bridging the cash flow gap.

Why do longer payment terms matter for buyers?

Trade finance allows buyers to optimize their working capital too. Without the pressure to pay suppliers right away, large retailers can invest in their operations, product offerings, footprint, employees, and their own growth and expansion aspirations. Having ample time to settle their bills gives retailers the opportunity to focus on their core activities and values.

Credit protection and collections services

Now, in the case a buyer happens to go bankrupt, trade finance still ensures that the buyer’s supplier gets paid. This is because trade finance, or non-recourse export factoring, includes credit protection to protect against non-payment in such cases of default.

This inclusion of credit protection allows suppliers to conduct business with peace of mind, without the worry of not getting paid.

These suppliers also benefit from the collections services that come as part of trade finance packages, which means the trade finance company is responsible for collecting payment from the buyer, giving suppliers more time to invest in their business.

The upshot

Cash is a major catalyst in allowing supply chains to function properly and operate smoothly. In a global trade environment that can be affected by everything from political discord to drought, reliable cash flow through trade finance is something a business can count on.

Trade finance provides easy access to cash by turning unpaid invoices into capital within 48 hours of verifying a business’s invoices, in some cases. Importantly, it supports payment cycles that work for all parts of the supply chain while reducing trade risk, allowing for strong, “happy” relationships and global trade dynamics.

Politics drives economic policy and economic policy guides business decisions. Its critically important during geopolitical influenced economic uncertainties that we minimize assumptions and emotional biases to our products and companies and make data driven decisions and choices.

These decisions should be based on facts derived from keen research and analytics and a logical thought process. There is no shortcut, you need to do or contract-out the work.

Focusing on Southeast Asia markets

After living in Singapore and working throughout the Asia Pacific region for more than 20-years, I offer my opinion based on my experience and expertise to help companies navigate the inherent challenges and barriers and  successfully compete and win in the fastest growing region on the planet.

In particular, the ASEAN, Indo-Pacific, or Southeast Asia region has emerged as the global growth engine of the next decade and beyond.

Companies worldwide should be pivoting to the region to take advantage of new and emerging growth opportunities.

Export is crucially important to any growth-minded company. It establishes the first step to entering a new market. As your business scales you can decide upon progressive steps like establishing a local sales office, bonded warehouse, or local manufacturing. In most cases exporting leads to foreign direct investment (FDI) in local manufacturing assets, either greenfield or acquisition.

Southeast Asia is not a homogenous marketplace. Each country is a different ecosystem, with its own vibe and set of preferences, values and norms. New entrants must be capable of understanding and embracing social and cultural diversity.

One-size-fits-all cookie-cutter strategies fail in Southeast Asia, – you need to tailor your approach to each unique market.

Don’t just adapt to Southeast Asia, become a part of it. Take the time to understand the culture, the history, and the emotions behind customer buying behaviors.

Getting started with market research

So where do you start? The first step is to identify, validate and quantify opportunities, and determine your company’s export readiness. The second step is to craft your market(s) entry or go-to-market strategy and business plan – think of strategy as your logic and compass, and your plan the roadmap or process.

The third step is to develop a distribution network capable of reaching your target customers. If you’re selling B2B2C you need channel partners. This article will delve into the first step of evaluating export markets for your business.

Finding the best sources of secondary research

Normally, when I approach a new research assignment, I purchase two industry reports. A typical and focused market survey or industry report will cost between $2,000.00 – $3,000.00 US.

Industry reports are a market assessment tool that provide a comprehensive examination of a particular industry in specific countries.

In my Indonesia example below (figure 1), the company wants to sell its fiber cement exterior finishing products. The total market volume for exterior finishing products is 79 million M², fiber cement products represent 4% of the total market volume. The company’s addressable market in Indonesia is 3.16 million M². I then convert volume into economic value, (volume x wholesale cost per M².) Most reports will provide compounded and annual growth rates and trends.

Other valuable sources for secondary data are Export Development Canada (EDC),  Asia Bank, IMF, government websites, Channel News Asia, and a few of my favorites that require a subscription are Nikkei Asia, Oxford Business Group, Focus Economics. I also use a segment specific project and leads directory when needed – as an example in the Asia Pacific construction segment I use BCI Asia. Secondary research data can cost between $8,000.00 – $10,000.00 US, depending on the scope of the research project.

Presuming we now have loads of secondary data, the data now needs to be translated into quantifiable, meaningful and useful information that can be shared and understood cross-functionally.

Analyze your data using the PESTLE model

One of the most useful analytical tools to evaluate markets is the PESTLE model, (Political, Economic, Social & Cultural, Technology, Legal, and Environmental factors.)

The PESTLE tool has evolved over the years, starting as a PEST analysis more than 20 years ago, then to the SLEPT analysis, and to what is used today the PESTLE analysis. An interesting and important addition is the Environmental factors.

The importance of Environmental factors and compliancy and how this can be leveraged or translated into differentiation and customer value should not be underestimated.

Southeast Asia customers make brand choices based on personal value perceptions and the environmental benefits and impact of your products. In addition to the PESTLE model, I use a weighted scorecard to visually organize and present my findings.

In my abbreviated example below (figure 2) I am only comparing three countries, all countries under consideration must be evaluated. Each main factor will have five to ten sub-factors. Each sub-factor is weighted on importance and given a score, the scores are tallied, then each main factor is calculated. In my example the total score for Singapore main factor political is 36.

We then create a graph chart (figure 3) to visualize our comparative and quantitative analysis. Every company’s analysis will differ due to different metrics or criteria. Each company will also have a threshold, in my example my minimum threshold value is 120, so Indonesia and Singapore would be selected as my target markets for further evaluation.

Further evaluation would come in the form of primary data collection, so get your passport ready, you need to travel to meet the potential customers you intend to sell to.

Get your passport ready for primary research

The best source for primary data collection is “voice of customers” (VOC), and I am a strong supporter of trade shows in the Southeast Asia region. However, trade shows are expensive, and the merit of a trade shows needs to be carefully considered.

In the post-Covid environment trade show costs have increased to pre-Covid levels. Trade show space and booth design cost will vary, I try to cap this cost at $15,000 US. You also need to consider travel expenses, and that cost could be $10,000 per week including airfare.

Considering this, we need to establish clear and attainable goals or outcomes to justify the expense. For me my goals are to:

1. understand the market and customers and begin building relationships
2. interview potential customers
3. identify key competitors, and
4. recruit distribution and channel partners.

I have learned from past experience to add a week post trade show to follow up with contacts and prospects gleaned from the event.

As an example, prior to Vietnam’s economic awakening, we identified Vietnam as a rising economy and attractive market. We attended a relevant trade show and then the following week was filled with business development activities, visiting potential distributors and customers, and we appointed two new distributors.

At this point we have conducted our initial PESTLE analysis through secondary data collection, participated in our first overseas trade show, visited potential customers and channel partners, and we can now amend our PESTLE analysis based on the more comprehensive information gleaned from our overseas trip. Next, we need to assess our capabilities and ensure we are correctly positioned and aligned to capitalize on the opportunities uncovered. Are we export ready?

Evaluating your export readiness

Being export ready is more than a mindset, it’s a commitment of resources and funding to support a successful export endeavor. The export ready self-evaluation process will help define your strategy and plans. FITT’s Feasibility of International Trade course provides thorough and contemporary training on how to assess organizational readiness. Typical questions

• Are you willing to invest in resources, people, time and capital without an immediate return on investment (ROI)?
• Will your pricing strategy enable you to compete profitably?
• Is product customization required to meet specific market or customer needs?
• Are your products compliant to relevant codes or standards?
• A new one for me recently, will your bar-codes scan in overseas markets?
• If exporting to a non-FTA country, what is the duty impact to market pricing and profitability for you and your partners?
• What are your trade terms and conditions, do you need credit insurance?
• Have you established clear, relevant, and attainable goals?
• Do you have senior leadership and cross-functional support?
• Do you have an international freight forwarder?
• Do you have experience with export documentation, do you understand incoterms?

Each company is unique and will have specific questions relevant to their business and chosen markets. Go beyond the superficial qualitative narrative and translate the data into actionable quantitative information.

The next step is to craft your market-entry strategy and business plan. Remember each market is unique, and the Southeast Asia marketplace is not just about products and price-points, it’s about people and relationships founded on symbiotic trust, confidence and collaborative partnerships.

I will share my thoughts on strategy and plans in my next article.

For more valuable tips and concepts follow me on FITT, LinkedIn, or my website.

Leah Sanford has a long-time passion for marketing. She enjoyed her corporate marketing role before taking the leap into entrepreneurship. She now helps other entrepreneurs take their brands global.

Her husband, Joel Kelly, shared Leah’s passion for marketing. He dreamed of starting his own business, and together, they built Kelford, Inc.

Through their company, Leah and Joel work with entrepreneurs to help define and articulate their unique value, and then demonstrate it to their very best customers. She finds joy in helping entrepreneurs from Canada and beyond change the world by helping them communicate in a way the world understands.

“An entrepreneur just has this creative mindset of seeing past the obstacles and wanting to try new things. There’s this creative, innovative space that just clicks a little different for an entrepreneur, and it’s so fun to work with.”

Leah strives to infuse fun and creativity into the process of helping entrepreneurs uncover their goals, define their value, and demonstrate it at a distance. So they can keep going, keep growing, and keep building a business they love.

If a business is online, it’s potentially international

Based in Canada, Kelford Inc. is both a local and an international business, thanks to the ease of connecting online.

“We often work with folks who are located here in Canada but sell around the world,” Leah explained.

“We’ve had many clients around the world trying to enter Canadian markets or other global markets. For us, it’s all about demonstrating your value, globally.”

Whether a business owner offers professional services, or artisan-made products via e-commerce, or deep-tech solutions, they may benefit from global trade training.

“Shopify changed the game, and Amazon before that. And Etsy has been this beautiful creator space on a smaller, more personal, artistic scale of what’s possible. It doesn’t have to be down the street anymore. The pandemic really opened that up from on a global corporate scale.”

Leah developed a more global approach from the Certified International Trade Professional (CITP) designation and international business training through the FITTskills program.

A resource that helps open doors

“I would absolutely recommend the FITTskills program to people who love long-term learning. The program is comprehensive – so in the long term, everything stacks really nicely.”

When the world slowed down during the COVID-19 pandemic, Leah decided to invest time into professional development. Invest Nova Scotia offers training and other resources for entrepreneurs including FITTskills training as a FITT educational partner. Leah took advantage of the opportunity and enrolled in the FITTskills International Sales & Marketing course.

“It felt like this little serendipitous moment that kicked me off on the right journey.”

That moment led Leah toward earning the CITP certification. She found the designation and the FITTskills program incredibly practical and easy to apply to real-world situations. In addition to knowledge, it also helped hone her mindset.

“It’s been a confidence boost. It obliterates that imposter syndrome feeling! It’s a great anchoring ground of knowing what I’m doing. I have the FITTskills textbooks to go back to. I have the knowledge base to go back to. I have the resources to draw on, and the connections that it’s opened up have been brilliant.

The program also offers moments of connection and the chance to network with other professionals and expand valuable international connections. Leah even found a new client who was a classmate in the same FITTskills course. She indicated that when looking for partners, the CITP designation acts as a green flag.

“I know that there’s been a vetting process in that credential. It’s a credential that has a governing body and there’s something really beneficial to that. When you’re evaluating apples to apples, this one suddenly is a little more nutritious.”

Paying it forward and building up other entrepreneurs

Leah jumped at the opportunity to help other aspiring entrepreneurs through the Lab2Market program. This federally backed, multi-agency partnership encourages master’s, doctoral, and postdoctoral-level researchers to gain tools that may help them take their expertise and innovations to the marketplace. Leah is a facilitator in the Lab2Market Oceans programs, through Memorial University.

“We’re focused on ocean innovation and technology. Students are bringing forward ideas and products such as oil spill clean up breakthroughs, improved safe navigation through icy waters tools, new marine coatings, etc. The program is comprised of brilliant students, many international, exploring how they might enter a global market—seeing if there’s a market for their idea. And we educate, and hopefully inspire, them to build businesses and take their innovations forward, while supporting them as they go through the roller coaster of emotions in customer discovery!”

Leah credits both completing the FITTskills training and earning the CITP designation for preparing her to help these scientists develop business skills and entrepreneurial mindsets.

Whether local or global, it’s all about relationships

Leah found that her relationships with clients don’t end with the initial project developing a marketing position and strategy. She likes to keep in touch with clients as they implement their strategy. Kelford also offers a daily inspirational positioning newsletter.

“For us, it’s natural to stay in touch and celebrate their wins. And on the flip side ask, are you struggling with anything? Just let them know we’re here.”

Over the years, Leah and Joel worked with dream clients including Big Cove Foods of Nova Scotia. They came to Kelford with a goal of bringing their spice blends from a local product to stores across the country. After exploring their goals and aspirations, Kelford helped them create an actionable marketing strategy.

As they implemented the plan, they found their voice and fun in their marketing, and were able to focus on demonstrating their value to their best customers. And with that focus, they saw pick up from stores across the country as well as growth in their online sales. As they’ve grown, their social impact has grown too—participating in ‘1% for the Planet’ where they donate to charities, and  prepare fresh meals and munchies to Viola’s Place, a homeless shelter in their community.

She sums up her ideal client as, “the entrepreneur who has an ambition that speaks to their soul, has a product or service that can do good out in the world. And then is really crafty, creative, and wants to do something more than for the hustle, more than for the dollars, but something they want to stick with for a really long time because it makes them happy. And that happiness makes their customers happy. That’s the dream.”

“When you go out somewhere to sell your product, it’s not over when you make the sale. Now we have to prove that we’re going to stick around, that we backup our product and our commitments, that we are here with the customer service.”

Looking toward the future in a changing world

Adaptability is crucial for entrepreneurs in an ever-changing market. Leah appreciates having the course text, case studies, and videos available as reference resources whenever new challenges and opportunities arise.

“So, what you knew and what you did two years ago is different now. What I would have recommended two years ago is different now. A marketing strategy I write this year is going to be different from the one I write in a year from now because of how the market changes.”

Leah envisions a future where Kelford, Inc. further expands its portfolio of client collaborations from all over the world. The choices when selling globally can be overwhelming. The knowledge and resources gained through the FITTskills program and validated through earning the CITP designation provide building blocks for success.

“My experience working toward and earning the CITP has been wonderful in terms of knowing “how can we leverage our skills, the tools that we know are out there?” It’ll always be just the two of us, but how do we grow that impact that we’re able to have? And we are really looking at that on an international scale now.”

In this three-part series, digital trade expert Craig Atkinson, CITP addresses key questions and practical considerations related to technology-enabled cross-border interaction among buyers, sellers, intermediaries, and governments. Article based on an interview by FITT’s Pamela Hyatt.

Craig Atkinson is the Founder and Director of Lexmerca International Trade and a Trade Development Specialist with the International Trade Centre (ITC), the joint agency of the United Nations (UN) and the World Trade Organization (WTO). His roles focus on addressing legal-technical challenges that affect global trade.

Active in the field of digital trade, Craig participates in the World Economic Forum’s TradeTech community and in projects with multiple international organizations, academic institutions, technology foundations, and standards bodies.

Academically, he is a Non-Resident Fellow with the World Trade Institute (WTI) as well as a Research Affiliate with the Singapore Management University (SMU) Centre for AI and Data Governance and the SMU Centre for Computational Law. Professionally, Craig has been a FITT Certified International Trade Professional (CITP) since 2011.

What is a ‘Single Window’ for trade regulation?

In the first article in this series, ‘Single Windows’ were described as exemplifying the digitalization of goods trade. Aside from being known as the most impactful class of ‘TradeTech’, what is a Single Window?

The answer is found in the ambitions of ‘digital trade facilitation’: government measures to simplify, harmonize, and modernize trade formalities and procedures to allow for cross-border paperless exchange between actors in international supply chains.

According to United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT) Recommendation 33, a Single Window (SW) is a ‘facility’ that “allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfil all import, export, and transit-related regulatory requirements”.

An electronic SW environment links government bodies – Customs and other government agencies (OGAs) like ministries of health, agriculture, and finance – for online application, issuance, and exchange of trade-related permits/certificates.

Private stakeholders include traders, agents, customs brokers, carriers, forwarders, ports, freight terminals, and commercial banks. As documents (or data) is in electronic form, they only require ‘single’ submission and leading systems utilize ‘rules engines’ for compliance automation.

While Singapore is credited with deploying the first SW in 1989 – TradeNet for Business-to-Government (B2G) exchange and the more recent Networked Trade Platform (NTP) extension to facilitate Business-to-Business (B2B) transactions – other countries have implemented projects for paperless trade via Single Window.

Note: Singapore is not a typical case. Above, ‘Trade Permit’ is used for Customs declarations. Yet, if goods require permits from other OGAs when submitting a ‘Trade Permit Application’ to TradeNet, the application is a ‘single’ submission for other OGAs to process and provide permits. Unlike the SWs of most countries, traders/agents using TradeNet do not have to apply for each permit separately.

How do Single Windows solve problems?

Borders represent a ‘labyrinth’ of paper that must be exchanged between private actors and government agencies through manual processes.

In reaction, Single Windows lower certain barriers to trade compliance – identifying, preparing, submitting, and coordinating documents – by creating a public-private interface to overcome what the Organisation for Economic Co-operation and Development (OECD) calls “sludge”: unjustified friction that affects satisfaction, trust, and access to government services.

As institutional arrangements, networks, and platforms, SWs generate observable results that make trade faster and less costly as well as more safe and secure. In offering the highest standard of public service delivery, a Single Window for trade is considered a ‘beau ideal’ by the World Customs Organization (WCO).

As SW is a ‘whole-of-government’ facility, Customs is just one of the involved regulatory agencies and its authority is limited to import/export approval and permitting.

Though Customs is often a lead agency for SW, it does not have legal power to override other OGAs. Even if a SW neither eliminates nor diminishes the role of any regulatory agency, simplification through a single point of entry mitigates duplication, ‘re-keying’, and other data-related issues while enabling consistent data reuse.

Significant benefits arise for trade logistics and economies: across studies on the impact of Single Window, costs fall for all actors (i.e., traders, intermediaries, and governments), trade grows between countries with SWs, and the public sector improves its revenue mobilization/collection capacity.

For example, in the United States, government agencies and traders have realized benefits with the Automated Commercial Environment (ACE). In 2021, the platform reduced transaction processing by 795,000 hours for private actors, assisted process automation for 269 forms/document types, and led to $2.7 billion USD in efficiencies.

How can Single Windows contribute to inclusive trade?

Single Windows are inclusive because, as a whole-of-government interface that is usually free (or low cost), they allow for micro, small, and medium-sized enterprises (MSMEs) to interact with governments with less or no need for intermediaries (e.g., agents and brokers).

A single channel of interaction lowers effort and administrative costs of compliance with documentation and increases accuracy/speed of submission and processing, helping small businesses to better participate in international trade.

For example, In Costa Rica, a study by Volpe Martincus et al. estimated the impact of the gradual phase-in (2007-2016) of an electronic SW, Ventanilla Única de Comercio Exterior (VUCE CR). Adoption of VUCE was associated with increased and more frequent exports by businesses using the system, larger shipments, and greater numbers of exporters, especially MSMEs located in non-central areas.

Such outcomes are particularly important in industries and sectors with specific or complex regulations. For instance, to meet Sanitary and phytosanitary (SPS) requirements for food safety, pest mitigation, or disease prevention, SW facilitated trade in agricultural goods has moved toward processing of electronic SPS certificates.

Are there different kinds of ‘Single Windows’ for trade regulation?

The short answer: no. The term ‘Single Window’ is frequently mis-used. In digital trade facilitation, it’s important to follow UN/CEFACT standard terminologies. Five ‘must’ features differentiate SWs for national trade regulation.

Source: Adapted from UN/CEFACT 2017

Given the strict criteria provided by Recommendation 33, true SWs are realized by a country as a ‘National Single Window’ (NSW).

At their core, NSWs are a B2G interface, but some systems have evolved to further allow for B2B transactions. Under Article 10.4 of the World Trade Organization (WTO) Trade Facilitation Agreement (TFA), member governments “shall endeavour to establish or maintain” a NSW. Article 10.4 is also the most frequently requested area of TFA-related technical assistance.

Under Article 23.1, a national trade facilitation committee (NTFC) is usually the appropriate cross-government agency/mechanism to guide and monitor NSW establishment.

Going beyond the scope of UN/CEFACT Recommendation 33, NSWs can be interlinked for Country-to-Country exchange as a ‘Regional Single Window’ (RSW).

However, these systems are not ‘facilities’ in the same sense as the Single Window definition: RSWs are Government-to-Government (G2G) focused and implemented under international frameworks as a collaborative system of NSW networks.

Additionally, and not to be conflated with a SW for trade regulation, there are many ‘sector-specific’ platforms, such as an airport Cargo Community System (CCS) or a maritime Port Community System (PCS).

The International Maritime Organization (IMO) defines a Maritime Single Window (MSW) as a “one-stop service environment”: a vessel operator-to-port interface for maritime procedures (e.g., port entry/departure declaration and security reports) between private and public actors. The amended Annex to the IMO FAL Convention makes MSW mandatory for ports.

In some cases, a ‘unified’ PCS can be considered MSW.

Which governments have established a Single Window?

Hundreds of Single Windows have been deployed and are at different stages of maturity. With more than ten years in operation, some SWs are relatively mature and cover all the OGAs in their respective country, such as Indonesia (Indonesia NSW, INSW), Singapore (NTP/TradeNet), and South Korea (UNIPASS/uTradeHub).

Those already deployed, but in in progress toward covering all OGAs, include Canada (Single Window Initiative, SWI), Chile (Sistema Integrado de Comercio Exterior, SICEXChile), Costa Rica (VUCE CR), Kenya (Kenya TradeNet), New Zealand (Trade Single Window, TSW), Pakistan (Pakistan Single Window, PSW), Peru (VUCE PERÚ), and the US (ACE).

Other jurisdictions are continuing to strengthen their bases for SW, including Australia, Bangladesh, the Maldives, and the United Kingdom (UK). For example, under the Single Trade Window (Preparation) Regulations and the Electronic Trade Documents Act (ETDA) (see FITT coverage), the UK is planning its NSW.

Taking stock of initiatives globally, the WTO Trade Facilitation Agreement Facility (TFAF) indicates that, at 56%, SW is the TFA measure with lowest ​implementation rate.

Source: Author based on WTO data (2024)

Regionally, Association of Southeast Asian Nations (ASEAN) members have established the ASEAN Single Window (ASW) and technical collaborations; the Pacific Alliance has connected its member NSWs; and the European Union aims to enhance ‘digital cooperation’ under the Single Window Environment (SWE) regulation.

Why do governments and the private sector need to work together?

More than a technology project, SW initiatives represent major ‘reform’ and require whole-of-government cooperation internally as well as collaboration externally with the private sector to realize a fully-fledged, evolved, SW environment. A Single Window and its suite of services truly represent a ‘virtual enterprise’.

Implementation of a SW requires planning and the creation of a legal-institutional framework, followed by business process analysis/design, document simplification/standardization, data harmonization, platform piloting, and phased deployment.

Despite the variety of implementation or operational models, all stakeholders should be aware of the types of decisions to be made at each phase:

• Develop internally: The public sector is made up of different agencies must coordinate the roll-out and functioning of SW with their own staff and resources. For governments, it’s important that services – Customs, finance/treasury, health, agriculture, – work harmoniously, regardless of the internal model(s).
• ‘Buy off the shelf’: Procure hardware, software components, and/or services.
• Engage in public-private partnerships: Any combination of options at different phases of implementation and/or operation of a Single Window.

What are some key resources for planning and deployment?

There are many implementation guides and even a ‘ChatGPT’ for Single Window. Key resources include:

• Under the auspices of the United Nations Economic Commission for Europe (UNECE), UN/CEFACT provides core standards and guidance, such as Recommendation 33 (establishing SW), Recommendation 34 (data simplification/standardization), Recommendation 35 (legal framework), the Reference Data Model White Paper, a technical note on terminology for SW, and the SW Assessment Methodology (SWAM).
• The WCO Compendium on Building a Single Window Environment (g., Volume 1 Part 1, Volume 2, and the supplement), WCO Data Model, and Data Harmonization Guidelines.
• The United Nations Trade and Development roadmap for building a SW.
• The United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) and its Network of Experts for Paperless Trade and Transport in Asia and the Pacific (UNNExT) provide a planning/implementation guide and expert Neelima Pamulapati has developed comprehensive case studies on legal frameworks for SW. Other important UNESCAP guides focus on Business Process Analysis and Data Harmonization/Modeling.
• The Asia-Pacific Economic Cooperation (APEC) SW implementation guide.
• With significance for Regional Single Window, UN/CEFACT Recommendation 36 provides guidance required for the interconnectivity and interoperability of two or more SWs, APEC has produced a study on SW systems’ international interoperability, UNESCAP provides a paper on ‘e-trade’ through the ASEAN Single Window, and UN/CEFACT is developing guidelines on establishing RSW.

How are you engaging with Single Window-related efforts?

Cross-border regulations are constantly changing and digital public infrastructure (DPI) must be agile. In certain situations, rules and requirements can change by the minute.

Taken as a whole, the contributions have been to advance Single Window design in support of greater engagement by software development and business communities.

Although ‘greenfield projects’ and ‘legacy system’ integrations face difficulties, prospects exist for SW ‘rules engine’ (re)design in the short-term and new thinking on the long-term viability of systems.

Everything is deeply interconnected and ‘global value chains’ (GVCs) depend on streamlined interactions between people through computer technologies. Single Windows should empower MSMEs to capture value in GVCs through ‘interlinking’.

Any trade professional, especially a CITP, may consider informing SW deployment and upgrading. The next article in this series examines relevant innovations and how a Single Window frontend/backend paradigm can be ‘flipped’ for optimal human communication, interoperability of systems, and impact.

Strategy at the core

A sustainability strategy acts as a guiding map with clear objectives and precise action steps to minimize adverse effects on the environment while maximizing lasting advantages for both the company and society at large.

By adhering to global sustainability benchmarks, organizations manage ESG risks and also enhance their standing among various stakeholders, including clients, shareholders, and authorities.

These sustainability initiatives foster a culture of effectiveness and purpose within the organization, which also results in reduced expenses and enhanced competitiveness in markets increasingly demanding these efforts from the companies they patronize.

1. Cascades

Packaging and hygiene products producer Cascades Inc.’s sustainability action plan recently received accolades for its forward-thinking aspects, which aim toward a circular business model. The company has focused on building a legacy on their dedication maintaining a circular supply chain for their products and packaging.

For the 5^th year in a row, Cascades was ranked among the top 100 most sustainable companies in the world.

The company’s investment policy included proactive investments aimed at sustainability goals, with perhaps the most impressive point of this plan being a target to shift all packaging to recyclable, compostable, and reusable forms by 2030. Amidst the growing urgency to combat climate change, this bold vision reflects Cascades’ resolute application of its circular economy philosophy and waste reduction practices.

Furthermore, Cascades intends to be a pillar of North America’s recycling sector with 17 sorting facilities, while having an impressive high usage ratio of recycled fibers in its products at 83%. Through its guarantee that more than 90% of all the goods manufactured are compostable, it’s estimated that 2.2 million tonnes of fiber is diverted from landfill sites, which leads to the preservation of over 31 million trees. Cascades is a leader in demonstrating a strong commitment to the environment and to society.

2. IKEA

IKEA’s sustainability strategy is based on three fundamental pillars: living sustainably and healthfully, focusing on climate action and fairness, and safety first. Applying several programs and strategies, the “IKEA Concept” aims to expand the scope of its actions and expand the coverage of sustainability action through 2030 – to reach more than one billion people around the world.

It’s a broad-ranging program that may encourage a huge section of the global population to adopt sustainable lifestyles and minimize the adverse impacts of their activities.

IKEA acknowledges the increasing importance of the contribution of families to the health, environment, and resilience of today’s world. For instance, these groups are helping to take care of our environment by working towards the reduction of pollution and carbon emissions through promoting energy and water conservation, the use of renewable energy sources, as well as suggesting sustainable means of nutrition.

Among their efforts, IKEA is are 100% committed to sustainable cotton ensuring the cotton they use is grown with less water and chemicals, helping areas that are subject to erosion and water scarcity.

The company has also prioritized drastically reducing greenhouse gas emissions across the IKEA value chain and moved toward the use of only renewable or recycled materials by 2030.

All wood used in IKEA products is also sourced from responsibly managed forests which do not contribute to deforestation.

On top of that IKEA has become very popular by developing products that are not just the cheapest but also the greenest, hence people are observing IKEA’s green credentials and making some effort to follow their lead.

IKEA’s vision: through 2030, reaching zero fossil materials or fuels used. This should be a major contributor to the reduction of global warming.

3. Pact

Pact developed a sustainability strategy which is based on organic cotton, fair trade practices, and environmentally smart shipping. Its initial purpose was to be an underwear brand, which has extended into men and women’s clothing.

Being a label that offers all kinds of organic cotton with tops, dresses, and lounge wear, it now ensures it sells only GOTS organic cotton, and that its processes are also certified by fair trade factories.

A notable example of their circular fashion initiatives is their partnership with the “Give Back Box” program, whereby people can use free shipping labels distributed by Pact to send on their used clothing on to multiple charities.

Through teaming up with SimpliZero and organizations similar to that, Pact ensures that each one of its products is manufactured on a zero-emissions basis and completely carbon neutral.

Packaging with Pact is all about paper eco envelopes with FSC-certified 100% recyclable material and cardboard boxes constructed of recycled material. All in all, Pact’s sustainability plan consists of fair-trade alternatives, carbon emission offsetting and ecologically sustainable packaging, showing the company’s involvement in the environmental and societal responsibility of the fashion business.

4. Novo Nordisk

A pharmaceutical giant, Novo Nordisk manifests its dedication to the environment through an innovative program called “Circular for Zero”, which tries to get Novo Nordisk to a point where the company’s activities pose no harm to nature.

The company reported a more than 66% reduction in carbon emissions and progressed even more after achieving 100% renewable energy consumption in all production centers in November 2020.

Aware of the magnitude of the sustainability issue, Novo Nordisk emphasizes that it will shift its supply chain and zero emissions out by 2045 through a set of bold ambitions, justifying its unalloyed dedication to sustainability.

Novo Nordisk not only has to face environmental issues but also solve the matter of equal access to treatment and affordable treatment for all patients who are in dire need with the help of their company.

The company’s “Changing Diabetes® in Children” Program is global and in almost 380 hospitals in low and middle-income countries, the initial goal being to create a platform where children with diabetes would have access to the right medical treatment.

Collaborating with UNICEF as a partner helps the company build an operations strategy concerned with identifying environmental factors. The activities demonstrate how Novo Nordisk encompasses the whole approach to disease prevention.

5. Clif Bar

Clif Bar implements CSR through various environmental initiatives including waste reduction, using renewable energy sources and campaigning for protecting our forests. Moreover, Clif Bar aims to make all its packaging recyclable, compostable or reusable by 2025, and this process is going to begin with the classic Clif Bar packaging.

Reducing plastic usage stands as the main principle followed by the company, and it plans to minimize the consumption of plastic by 12% and to acquire 25% of its plastic from recycled or renewable sources by 2025. In addition, Clif Bar has committed to remove 1000 tons of plastics from the ocean within the specified years.

Besides that, Clif Bar has moved towards the harnessing of renewable energy which is one of the company’s main objectives, and to have all their production facilities powered by clean energy by the year 2030 as well as cutting down CO2 emissions by half.

The firm also aims at planting up to 1 million trees by 2030.

Clif Bar’s process-based approach in its value chain is an indicator of the organization’s determination to make the whole food system sustainable – from sourcing raw materials to the final product delivery – as healthy as possible.

Sustainability with purpose

The path to sustainability for companies no matter small or large is by way of combining purpose and faithfulness. It’s clear that sustainable management can be applied not just in the operations of business, but also can cover waste disposal, renewal of energy sources, procurement of raw materials, and reduction of plastic use.

These brands are serving as leaders, demonstrating how companies can start modifying their business practices by focusing on environmental issues and building a portfolio of green activities to create this future. The promotion of sustainability is not solely a decision, but also an obligatory commitment. Its advantages are not only for the company and its customers, but for the entire global community as a whole.

These books cover vital subjects like supply chain management, geopolitics, leadership, business strategies, the AI economy, cultural diversity, and the historical context of global trade, offering valuable perspectives for navigating the complexities of the worldwide market.

1. The Culture Map: Breaking Through the Invisible Boundaries of Global Business by Erin Meyer

Erin Meyer’s book “The Culture Map” explores cultural differences in the workplace, emphasizing the importance of understanding nuances for effective communication and collaboration. She introduces “authentic flexibility” for adapting to diverse cultures while staying true to oneself. The book provides insights on virtual communication in multicultural teams and offers practical tips for successful cross-cultural interactions. Meyer’s work is a valuable resource for enhancing intercultural competence and succeeding in diverse professional environments.

2. The Value of Everything: Making and Taking in the Global Economy by Mariana Mazzucato

The Value of Everything” by Mariana Mazzucato critiques how economic value is measured and the blurred line between value creation and extraction in the global financial system. The book examines cases from Silicon Valley to pharma, illustrating how this confusion impacts innovation and inequality. Mazzucato calls for a re-evaluation of capitalism, public policy, and value measurement to promote sustainable economic growth. She challenges the idea that market prices reflect true value and argues for a re-politicization of value as a social and political concept. Professionals importing or exporting are well versed in the myriad of complexities in valuing products, services and components. This book offers a fascinating perspective on the whole system.

3. How the World Ran Out of Everything: Inside the Global Supply Chain by Peter S. Goodman

The book “How the World Ran Out of Everything” by journalist Peter S. Goodman explores the complexities and vulnerabilities of the global supply chain. Through gripping storytelling, Goodman exposes the intricate pathways of manufacturing and transportation that bring products to our doorsteps, while also unveiling the ruthless business practices that have left local communities vulnerable to disruptions. Highlighting recent events like the pandemic-induced shortages, Goodman illustrates how financial interests, market opacity, and deteriorating working conditions have placed the supply chain on the brink of collapse. By following the journeys of individuals from factories in Asia to striking railroad workers in Texas, Goodman advocates for a reformation of the supply chain to ensure reliability and resilience.

4. Scale: The Universal Laws of Growth, Innovation, Sustainability, and the Pace of Life, in Organisms, Cities, Economies, and Companies by Geoffrey West

Geoffrey West, a pioneering physicist in complexity science, unveils the hidden laws governing the life cycle of diverse systems, from living organisms to cities. Contrary to the complexity of these systems, West’s discoveries reveal an underlying simplicity that unites them. By applying the rigor of physics to questions of biology and mortality, West found that mammals, despite their diversity, follow scaling laws that relate their size to various biological characteristics. This groundbreaking insight extends beyond biology to include cities and businesses, where similar laws of scalability apply. West’s work offers a unique perspective on the fundamental principles governing diverse systems, relevant for professionals working in global business. “Scale” is a captivating journey through fundamental natural laws that connect us all in profound yet straightforward ways, illuminating how cities, companies, and life itself are governed by the same principles.

5. Pivot: The Only Move That Matters is Your Next One by Jenny Blake

If change is the only constant, let’s get better at it.

In “Pivot: The Art and Science of Reinventing Your Career and Life,” Jenny Blake, a former career development manager at Google, shares practical strategies for navigating career transitions effectively. In today’s dynamic economy, where job roles change frequently and career plateaus are common, Jenny Blake introduces the concept of the “pivot” as a way to methodically make your next career move. Drawing from her experience in Silicon Valley and as a career consultant, Blake presents the Pivot Method, a framework for taking small, strategic steps towards a new direction in your career. Whether you’re considering a new role, starting your own business, or transitioning to a new industry, this book provides actionable advice to help you move forward with confidence.

With practical guidance and real-life examples, Blake empowers readers to embrace change and chart a path towards greater career satisfaction and success.

6. The International Business Culture Pathfinder: A Practical Guide to Navigating Cultural Differences in Global Markets by Marvin Hough

Written by experienced CITP Marvin Hough, The International Business Culture Pathfinder is a collection of concise business culture guides for 11 countries, including Brazil, Canada, China, UAE, South Africa and more.

This book provides a comprehensive overview of each nation’s business landscape, cultural traits, and practical scenarios demonstrate the impact of culture on business. Whether you are a seasoned global business professional or just embarking on your international journey, this resource is indispensable for grasping negotiations, communication norms, relationships, management approaches, and time management in varied cultural settings.

7. Power And Prediction: The Disruptive Economics of Artificial Intelligence by Avi Goldfarb, Ajay Agrawal and Joshua Gans

In “Power and Prediction: The Disruptive Economics of Artificial Intelligence,” Avi Goldfarb explores the “Between Times” of AI evolution, highlighting the necessity for systemic changes in decision-making processes within organizations. Despite the transformative potential of AI, its widespread adoption has been delayed, akin to past technological revolutions such as electricity and computing. Goldfarb stresses the need for complementary innovations alongside AI advancements.

8. Dare to Lead: Brave Work. Tough Conversations. Whole Hearts by Brené Brown

Leadership goes beyond titles, status, and authority. A true leader is someone who takes on the responsibility of identifying potential in individuals and ideas and has the bravery to nurture that potential.

Renowned author Brené Brown, a four-time #1 New York Times bestseller, has dedicated decades to studying emotions and experiences that add value to our lives. For the past seven years, she has collaborated with transformative leaders and teams worldwide. In her book “Dare to Lead,” she delves into how courageous leadership entails recognizing potential, staying open-minded, sharing power, and embracing vulnerability. The book stresses the importance of cultivating human qualities like empathy, connection, and courage in a society dominated by scarcity and fear. It presents four essential skill sets for courageous leadership and advocates for choosing courage over comfort.

From the humblest middle manager to the CEO of a fortune 500 company, anyone who wants to lead effectively could learn from this book.

9. Principles for Dealing with the Changing World Order: Why Nations Succeed and Fail by Ray Dalio

A few years ago, Ray Dalio observed unique political and economic conditions, leading to his exploration of repeating patterns in wealth and power shifts over the last 500 years.

“Principles for Coping with the Evolving World Order” delves into the most tumultuous economic and political eras in history to explain why the future is expected to be markedly distinct from our own experiences, yet reminiscent of past occurrences.

Ray Dalio discusses unique circumstances leading to global changes and offers advice on navigating upcoming challenges. Dalio’s analysis covers major empires and historical patterns to provide practical principles for preparing for the future.

For professionals working in international trade, navigating the turbulent geopolitical and economic environment is part of the job. Learning more context for how things evolve may just help you get ahead of the curve.

10. Prisoners of Geography: Ten Maps That Expla in Everything About the World by Tim Marshall

Journalist Tim Marshall’s book “Prisoners of Geography” explores how physical characteristics of countries like Russia, China, the US, Latin America, the Middle East, Africa, Europe, Japan, Korea, and Greenland and the Arctic, their strengths, vulnerabilities, and leaders’ decisions. In ten chapters and ten maps, the book delves into geopolitics and how geography shapes global strategies and historical events. It highlights the impact of geography on nations’ destinies and provides a fresh perspective on world affairs, something that is incredibly helpful for anyone doing business in foreign markets.

Knowledge is power, and continuous learning is the cornerstone of success in the evolving world of international trade. Share with us your top reads in 2024!

Visualize data in numerical format

Numerical data should be presented as charts, tables or graphs wherever possible. Researchers can use a wide range of tools to present material in an attractive and clear format. Spreadsheets can organize numerical information and generate graphs and charts. Graphics packages can also be used to portray both numerical and non-numerical information.

Tables are one of the easiest methods of presenting quantitative data, but they must be well organized. Tables must have clearly labelled rows and columns and be organized consistently.

Graphs and charts present numerical information in a visual form. Each part of the graph or chart should be labelled clearly. There are various styles of charts to choose from. For instance, pie charts are used when the components of the data being shown must add up to 100 percent. They are most often used to show market-size data, classification data or market shares.

1. Pie Charts

2. Spider charts

This type of visual representation is sometimes used to present comparative numerical information in a way that quickly and easily highlights differences among categories.

3. Bar charts

Bar charts or histograms are a common tool for illustrating data and are most commonly used with rated data. They can be used to show customer satisfaction levels, market size for different companies and trends within a group.

Present data in qualitative format

There are many effective ways to visualize data if it’s qualitative as well. Information can be presented in the form of a flow chart that communicates processes or decisions, or it can be explained in relation to marketing frameworks. Quotes can add emphasis to a point, because they indicate the thoughts of the consumer. However, quotes should never directly identify an individual.

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

4. Flow diagrams

This is a very simple and effective way of presenting organizational data. Flow charts should be labelled clearly, and the flow of a decision or process through the various stages should be clear and easy to understand. The reader should be able to start at one point and follow a path through to the conclusion.

In today’s dynamic job market, the hiring landscape is rapidly evolving. Employers are shifting focus from traditional qualifications to prioritizing practical expertise and tangible skills. This move towards skills-based hiring is transforming the job market, creating both new prospects and challenges for professionals looking to progress in global trade. 

Keeping pace with these changes, FITT sees continued value in offering practical training and credentials to address the current challenges in global business and reflect professionals’ earned skills and knowledge. 

In this brief recap, we invite you to celebrate the achievements of the FITT learning community in 2023 – a testament to resilience, dedication, and the transformative impact of education. 

It’s inspiring to observe the vast number of individuals from varied sectors, job positions, and organizations who have dedicated themselves to enhancing their skill sets and achieving their professional objectives by obtaining FITT credentials in 2023. 

FITT Certificate earners: Nurturing the next generation of trade experts

The FITT Certificate in International Trade is presented to individuals who’ve successfully completed any 3 FITTskills courses, or the equivalency thereof. In 2023, 263 new FITT Certificate holders emerged, showcasing the program’s continued relevance and impact. Notable organizations such as Global Affairs Canada, MUJI, Invest Alberta Corporation, Sumol+Compal Marcas SA, Block 4 Oilfield, LLC, North Atlantic, Export Québec, La Molienda and World Intec Co are now home to professionals equipped with FITT Certificates. 

Geographically, the FITT Certificate holders are making their mark in Asia-Pacific, North America, and Europe. The job roles, including Trade Commissioner, International Trade Advisor, CEO, and Export Consultant, reflect the diverse career paths of those who started the training to get the FITT Certificate.

Value of FITTskills Courses: 89% of respondents find FITTskills courses valuable. – 2023 FITT Customer Satisfaction Report

FITT Diploma holders: A growing force in global business

The FITT Diploma in International Trade holders are on the rise, with 487 graduates joining the league in 2023.

87% of respondents find FITTskills courses relevant to their jobs and responsibilities. – 2023 FITT Customer Satisfaction Report

The number of FITT Diploma holders not only eclipses the previous year’s count but also emphasizes the increasing importance placed on trusted international trade credentials. This year’s FITT Diploma earners span diverse sectors, including agriculture, food, manufacturing, finance, logistics, and technology.

The extensive list of companies these diploma holders are now associated with includes enterprises like RBC Royal Bank of Canada, TD Bank Group, Epiroc, SGS Canada Inc., Haya Solutions Inc., Coca-Cola Bottling, and Tjx Canada. From government agencies to private enterprises, the FITT 2023 Diploma holders are weaving a rich tapestry across the international trade spectrum. 

Their reach extends globally, with professionals working with business divisions located in Europe, Latin and North America, Asia, and East Africa.  

Among the Diploma holders, the job roles include Export Sales Manager, Business Development Officer, Commercial Officer, Project Manager, Import & Export Analyst, Supply Chain Specialist and more. 

Having gained expertise in the 6 key  knowledge areas that make up the FITTskills program, the FITT Diploma holders have achieved one of the main requirements to apply for the Certified International Trade Professional (CITP) designation.  

CITPs: A community of validated trade leaders represented world wide

The Certified International Trade Professional (CITP) designation stands as a beacon of excellence in global trade. With CITPs present in 47 countries, the community represents a network of certified international trade practitioners, contributing to various sectors and industries. 

The list includes a wide range of job positions, spanning from Trade Commissioners, Managers, Directors, and Presidents, to various specialized roles in logistics, finance, law, marketing, supply chain management, and education.  

The company list exhibits a diverse array of industries, ranging from government and trade organizations, such as Global Affairs Canada and Export Development Canada, to educational institutions like the University of Calgary and Niagara College. It also includes technology giants like IBM and Google, manufacturing and aerospace companies such as Airbus Helicopters and Teck Resources, as well as consulting firms like Deloitte. The presence of financial institutions, retailers, healthcare, logistics, and mining companies underscores the broad spectrum of sectors involved in international trade and business development. 

From professionals who specialize in logistics, law, finance, and education, CITPs are leading the charge in shaping the future of international trade and business development. 

FITT continues the mission of advancing the international trade profession. The growing numbers of FITT Diploma and Certificate Holders, coupled with the global presence of CITPs, paint a picture of a community that is not only expanding, but also influencing the trajectory of global commerce.

As we reflect on the accomplishments of FITT’s learning community in 2023, we anticipate an even more impactful journey ahead, shaping the future leaders of international trade. Whether you’re a government official, a private sector professional, an aspiring entrepreneur or a leader looking for training to upskill your team, you can be inspired by the 2023 FITT credential achievers and begin your own journey through skills development and professional certification.

More than ever, validated skills are the gateway to success in the complex world of international trade. 

This was adopted by businesses that remained productive and profitable during that time of economic disruption.

Subsequently, during the Covid-19 pandemic, we noticed, businesses that maintained a global productivity mindset were able to innovate and tweak their processes rapidly to tap into new market opportunities. This resulted in resiliency and growth.

New packaging to serve a new demand

An example of resilience and innovation involved a restaurant that modified the method of serving food. This restaurant identified an opportunity to support truck drivers making deliveries across the Canada and United States border. During the Covid-19 pandemic period, many food outlets along trucking routes were either closed or limited services to drive-through.

Most trucks could not use the drive-through services. The restaurant modified their food packaging to individual serving portions of ready to eat meals. These meals were offered both as freshly cooked and frozen sealed packs. These individual portions were ideal for truckers on their long drives across the border and back. The frozen meal packs were convenient as these could be heated up in the trucks. This enabled truckers to continue deliveries in a timely manner.

The restaurant’s business has grown into a specialty supplier of meals for the trucking industry. An additional benefit was the popularity of these meal packs with students. The restaurant flourished and maintained its take-out unit even after the pandemic. There were no layoffs as servers were re-trained and deployed as packers.

Reaching a wider audience through online services

We ourselves, pivoted to providing lectures at the university using online video platforms. This enabled more rural and out of province students to register and attend classes.

Fellow lecturers at institutions across the country contributed ideas on how to make online teaching more effective. This experience has created opportunities to provide consulting and training services online to clients across a wider geographical reach.

Modifying products to take advantage of near-shore supplies

A local chef who had trained at a Canadian culinary college was able to modify Hong Kong comfort food recipes to the taste of his customers. He utilized ingredients readily available in abundant supply. By doing this he avoided supply chain disruptions in delivery of exotic ingredients from Asia.

Applying a global productivity mindset, he sourced for local ingredients through near-shoring for supplies. He retrained his staff on how to prepare these new menu items. With a more resilient supply of ingredients secured, this enterprising chef was able to grow his customer base and open a branch across the city.

A global productivity mindset helps businesses to stay focused on producing more with existing resources.

Many businesses responded rapidly to the pandemic restrictions by tweaking processes to ensure health and safety of both customers and staff. They limited number of customers entering the stores at any one time and provided hygiene training to staff.

To secure a steady supply, some stores consolidated the range of fresh produce and processed products to items having secured local and international suppliers. A productivity mindset encouraged initiative to ensure resiliency in the supply chain which resulted in continued profitability.

An international café chain has established a network of near-shoring suppliers to ensure timely delivery of fresh coffee beans to their café branches across continents. For their café branches in North America, coffee beans are sourced from growers in South America. Coffee beans for the café branches in Southeast Asia are sourced from growers within the region.Having multiple suppliers within local regions ensures reliability and resilience in their supply chains

Businesses can now pivot towards serving the growing population of middleclass consumers worldwide. This can be achieved through a combination of friend-shoring, near-shoring and re-shoring with businesses along the supply chain adopting a global productivity mindset.

Applying such a mindset to decision making on raw material sourcing or location of manufacturing can result in greater resiliency in the supply chain.

What makes a business able to pivot while others can’t?

We investigated as to why some businesses were able to adapt while others found it difficult to do so. One factor that stood out with those able to adapt was in the fact that prior to the pandemic lockdown the more agile businesses had business owners with a productivity mindset focused on maintaining cash-flow and customer satisfaction.

There was a steep learning curve for many businesses and those focused on productivity and innovation, were able to learn and adapt to the unfamiliar environment.

The successful businesses illustrated in this article all had a global productivity mindset whether they were aware or not. They remained focused on their vision and mission.

This resulted in innovations that helped maintain customer satisfaction while preserving cash flow. This combination improved productivity and promoted business growth.

Stay faithful to your long-term vision and use your mission statement to drive innovation that maintains competitiveness even when market conditions change.

This is the essence of a global productivity mindset, a critical asset that enables business leaders to achieve and maintain success.

Avoid cutting expenses that will cost more in the long run

We are now experiencing potentially disruptive economic conditions that include supply chain challenges, inflation and the introduction of artificial intelligence, all happening simultaneously across industries worldwide. In this environment, it is the most agile leaders with a mindset focused on productivity who will be the ones to succeed.

Some organizations have taken the decision to cut expenses by laying off employees in the higher pay bracket. This can result in a double loss:

1. The morale among the remaining employees can go down, thereby reducing their productivity; and,
2. When the economic situation improves, the organization will have to spend more on training new employees.

Adopting a global productivity mindset can help organizations retain their premium employees in adverse conditions.

3 ways to apply a global productivity mindset

To acquire a global productivity mindset, make sure your work processes are aligned to a long-term vision that shapes a mission driven productive work culture.

To inspire and drive productive performance:

1. Encourage team members to seek out fresh perspectives, training, and flexibility in work practices.
2. Match talent to job requirements, and challenge team members to innovate and adapt to change.
3. Utilize the feel-good factor of achievement to encourage sustainable productive output.

Why not try tapping into the global productivity mindset to see how your business can utilize your existing resources more innovatively?

 “Vision and mission statements must come off the boardroom walls and be instilled into the workforce as a global productivity mindset driving the organization” – Quote from Page 12

While every business is unique, taking inventory of what worked for other successful enterprises, and what didn’t, can help you keep your business on the right track and even boost it to the next level of profitability, growth, and customer approval ratings.

Keep in mind: learning from mistakes doesn’t just apply to our personal lives.

Let’s take a look at common mistakes international businesses make, and how trade finance can relieve some of the financial stresses that come with the territory of being an entrepreneur:

1. Poor cash flow management, the #1 reason small businesses fail

So many parts of running a business rely on a healthy cash flow. Working capital is not only used to cover everyday expenses like payroll and electricity, but it is also needed to pursue bigger plans like growth and expansion into new markets.

There are a couple of factors that can impair cash flow, however, leaving a company with a lower reserve of liquidity than it would like.

In fact, according to a report from Jessie Hagen, previously of US bank, 82% of failed small and medium-sized businesses went under due to poor cash flow management.

Too much growth, too little capital

Growing too much, too quickly, in some cases, can actually be detrimental for a business. Rapid growth may have the adverse effect of drying up cash and might ultimately send a business hurling towards bankruptcy.

This, in fact, happened to the ice cream brand Ample Hills, based in Brooklyn, New York. The company grew from a single local scoop shop to having a footprint of 17 stores nationwide, links with Disney, a presence in grocery retail outlets, and a stamp of approval from Oprah Winfrey, according to the New York Times. Though this brand never ended up expanding overseas, rapid growth without the right support can hurt businesses trading internationally just the same.

Brian Smith, Ample’s co-founder, revealed to the Times, “We made every mistake it is possible to make.”

This included an ill-placed location in Los Angeles and switching up packaging from a traditional round container to a square one. Even with the Ample Hills brand skyrocketing to success, decisions like these ultimately sapped the company’s cash.

Trading with long payment terms in place without the right oversight and support

While the demands of rapid growth may be one culprit for leaving a company cash-strapped, long payment terms with buyers can also drain a company’s liquidity if not managed correctly.

Today, many commercial transactions occur on open account terms, which means buyers are allowed to pay their bills months after an invoice is generated.

Recent data shows that large U.S. buyers take an average of 54.7 days to pay their invoices.

While giving customers the freedom to pay later can help a business win and retain orders, a company must be vigilant of the cash gap that can occur with such terms in place. Many businesses may find themselves needing to pay their vendors upfront, while still waiting on payment for their sales.

Without a keen awareness of the overlap in outgoing and incoming payments, cash flow might be jeopardized.

2. Selling domestically or internationally without having the demand needed to succeed

It can be the aspiration of many growing companies to expand domestically, or even enter new markets abroad. But without the demand overseas or at home, your product may turn out to be a flop.

According to a recent Forbes article titled “Small Business Statistics of 2024”, inadequate market demand is the second most common culprit for business failure.

Inadequate market demand is the second most common culprit for business failure.

“For a small business to be successful, it’s imperative not only to have adequate capital to sustain operations in the early stages but also to ensure there is a consistent and growing demand for its products or services,” the article states.

Given this common mistake, it’s imperative to conduct sufficient due diligence before launching a new product or service. A business must take the necessary steps, like conducting a market gap analysis and gaining a full grasp of the demographics they’re trying to reach, in order to set itself up for success.

3. Skipping credit protection

As we’ve seen in the past couple of years, several big-box retailers have gone out of business. These famously include Bed Bath & Beyond, Christmas Tree Shop, and Lord & Taylor.

When doing business with these large buyers, credit protection can come in handy if bankruptcy is looming for the retailer.

It’s not always easy to predict if a retailer will shutter, but the pandemic taught us that large brands can go bankrupt, and if they don’t fully collapse, then they can still be tardy on their payments to suppliers or skip paying them completely.

How trade finance can help businesses stay the course

Trade finance is a tool that can help businesses better manage their cash flow, reduce trade risk, and accelerate their growth, among other things. Companies of all sizes can take advantage of this financial resource, but small and medium-sized enterprises are especially known to benefit, since traditional banks may require them to meet stricter borrowing criteria.

If a business opts to use trade finance services, here’s how it works:

A financial intermediary will purchase their unpaid invoices and will provide them cash upfront in exchange. This sum of cash will equal up to 95% of the invoice amount.

By receiving this cash advance on the payment they are owed, a business can pay their own supplier on time, or on an earlier schedule. Retailers and other buyers can still enjoy longer windows to pay their invoices since the financial intermediary is able to close the payment gap.

What’s more, trade finance also includes credit protection and collections services.

This means that a business is guaranteed to get paid even in the case of buyer insolvency, as the financial intermediary absorbs the risk in this case and will ensure the business gets paid.

Since running a business requires a lot of focus on marketing, R&D, and customer service, accounts receivable management that comes as part of trade finance packages can take the burden of collecting payment from customers off the business.

The Upshot

Operating a business has its challenges, but it also comes with many rewards. Paying attention to the mistakes that other businesses have made can certainly protect a company from falling into the same pattern.

To get a better handle on cash flow, secure an extra layer of security, and get more freedom to focus on running core business activities, a company can consider trade finance as a solution that can clear hurdles and pave the way for success.