ExportNZ executive director Catherine Beard travelled to the US late last year, and met a number of New Zealand’s key overseas trade representatives. She shares some market intel with Exporter.
ExportNZ executive director Catherine Beard travelled to the US late last year, and shares some market intel.
America – big, brash, and for Kiwi exporters, seemingly filled with barricades to market entry. Compounding the problem of market entry is that fact that it's not one single market – rather 50 separate markets each with its own set of rules, regulations and governing bodies. It's not for the faint-hearted. Fortunately, unlike their pioneering predecessors, today's exporters can tap into a lot of help in order to gain a foothold in what is regarded as the world's wealthiest, most sophisticated, and arguably most challenging, export destination.
Leon Grice, NZ consulate general, based in Los Angeles, Marta Mager, NZTE's regional director, and Carl Voight, professor of entrepreneurship at USC Marshall School of Business and Beachhead advisor to NZTE, represent a sizeable chunk of that assistance.
ExportNZ executive director Catherine Beard, on a recent trip to the US, tapped into their combined knowledge to learn what Kiwi firms are doing in that market and what firms could be doing better.
First, the services spend in the US is significant, she says. “A lot of it is driven by intellectual property and we are starting to see New Zealand companies do well in this space, like Orion Healthcare, Xero, and Vista. As more of these entrepreneurs succeed they can influence other business leaders and a sense of community grows.
“New Zealand has one of the highest spends on education in the OECD – if we can connect smart innovative people with US capital and connections we will do well.”
Feedback suggests New Zealand companies need to go on more trade missions in the US, says Beard. “The learnings are immense and doors open when you're in a group. Too many Kiwi companies get to the US with limited horizons. They need to think big and have the courage to fail. Failure is a much more acceptable trait in the US and thought of as part of the journey.”
In the US market speed is everything. Exporters may need to give up some ownership to raise the capital to execute with speed, says Beard. “In the US, burning cash is also seen as positive. It means you are growing but you are not going to own 100 percent of the business by the end of the journey.”
If your strategy includes putting local people on the ground in-market, remember that executives cost more to hire in the US and may earn more than the business owner. “But good executives with sound local knowledge and contacts are worth it,” says Beard.
If you're selling online get listed with Amazon and make sure your brand is optimised for the search engines, she adds.