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This article was written by Jeffrey P. Graham and it originally appeared on Citibank's now defunct international business portal. Now
that the U.S. economy is faltering, many business executives are going to give
serious consideration to taking their dog and pony shows on the road, so to
speak. Trade missions are
frequently mentioned in the how-to-export literature as a sure fire way to
quickly develop sales in foreign markets. As
with most things written about in the general business press, the reality is
quite significantly different than the perception.
Unfortunately, this is problematic for many small and medium sized
companies. First
of all, there is a persistent notion that merely bringing business people
together will result in business deals. Business
development specialists frequently make this argument and are often very
persuasive. However, anybody who
has ever actually sponsored a trade mission or overseas business development
conference and then taken the time to do a follow up evaluation will readily
tell you that the results are quite often mixed even in the most optimistic
scenarios. Why?
Well, there exists in the minds of too many people the notion that most
business deals are actually done in what are basically social situations; grown
men playing golf, women executives getting together for lunch, after hours
cocktail parties, and so forth. For
this, we have Hollywood writers to blame. While
all of these occasions can be a part of the give and take of developing a
business relationship, they are not necessarily the focal point upon which
closing a deal might rest. There
are many complicated factors that go into making a buying decision or closing a
business deal across national borders and therefore it is not very realistic to
assume that merely bringing the parties together in the same physical space with
free or cheap alcoholic drinks will supercede these other very important issues. The
next problem is the actual nature of the trade mission itself.
Business development specialists will argue that the trade mission is an
integral part of the international marketing mix. Historically, this has been
true to some extent. What has been likewise true is the fact that industry
organization sponsored trade missions are probably more successful than those
sponsored by government agencies. But
if one examines closely who sponsors the vast majority of trade missions, you
will often find the hand of a government agency somewhere.
Trade missions are supposed to be about developing trade opportunities.
However, once government agencies become involved, the mission of the trade
mission has been fundamentally changed. The
reason for this is very simple. Trade missions sponsored by private industry
groups tend to pick venues and choose local partners who have the necessary
expertise to produce successful events. Industry
organizations represent the industry and are not beholden to other private
political interests. When
government agencies become involved, the actual reason for doing the trade
mission may have nothing at all to do with the particular industry selected or
the actual companies selected to participate. To suggest that this is
troublesome is to egregiously understate the case.
Politics, especially international politics, and business do not mix very
well. The
people in government who have power over the budget and appropriations are quite
often dictating policy to career civil servants. This dichotomy serves to
actually undermine the quality of the intellectual output of those within
various government agencies who have the authority to declare which trade
missions will be supported and which ones will not. These political appointees
who control the purse strings seldom have the prerequisite international
business experience to understand the folly of their decisions. When such people
oversee the decisions of their more knowledgeable junior colleagues, anything
can and will happen. Consider the
following:
Beyond
the inherent problems with trade missions, there are some very simple practical
considerations. Whenever a business
executive is approached as part of a recruiting effort to join a trade mission,
there are several factors that must be considered:
Trade
missions are designed to transport business executives into a foreign business
environment but within the protective umbrella of the mission itself. The
mission itself is supposed to compensate for the inherent weaknesses of many
individual executives with little or no foreign business experience. The purpose
of most trade missions is not the goal clearly stated to the companies recruited
to join the mission. In fact, this goal is almost never the real purpose of the
mission, even though trade mission organizers will argue thusly to their graves.
The usual purpose of a trade mission is to either satisfy some industry segment
for partisan political purposes or to demonstrate to the electorate that an
administration is hard at work promoting exports and therefore protecting
existing jobs while going forth to create new jobs.
While all of this is certainly true, it is likewise true that even with
such constraints, trade missions do present companies with an opportunity to
test the waters in selected overseas markets.
In order for your foray into a trade mission to be successful, you are
going to have to be open minded, skeptical, wary and you’re going to have to
be willing to ask lots of very unpleasant questions. If you can do all of those
things, then you just might be able to actually participate in a trade mission
and accrue some tangible benefit. |
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