Portland Community College | Portland, Oregon

Experts from PCC’s Small Business Development Center at CLIMB weigh in on Going Global

Photos and story by Jim Beriault

Are you a small business owner?  Are you attending classes at PCC?  This story may be for you.

Many Oregon small businesses are interested in jumping on the global bandwagon, and for good reason.  More than 95% of the world’s marketplace is located outside of the U.S., and considering international expansion provides a terrific opportunity for businesses to grow – why not jump in?  But before you do, the experts at the Small Business Development Center are offering up their top 10 concerns to consider so that success is achievable.   Additionally, the Small Business Development Center is offering international trade advising, an international trade distance learning program, plus an upcoming 10-month training program to make sure small businesses are ready for today’s multi-market encounters, the class begins September 26^th.  Visit www.PCC.edu/CLIMB for more info and details.

There are many challenges in the international business arena that require the development of specialized knowledge, skills and abilities. One of the most critical, though under-appreciated skills that successful international business people have, is the ability to overcome their natural ethnocentrism. Ethnocentrism in this case means evaluating other peoples and cultures according to the standards of one’s own culture. “This seems obviously important, yet it is deceivingly difficult to achieve in practice,” said David W. Kohl, International Trade Liaison at the Small Business Development Center at CLIMB. “Reality to us as individuals is based upon how we view the world, and it is natural that we assume, to varying degrees, that others see the same “reality” that we do and act accordingly. One must remain ever vigilant to avoid unconsciously reverting back to what we “know to be true” and assuming that others see things the same way in which we do. It is wise to always try to see things from a variety of perspectives, especially when dealing with obvious cultural differences, and not take for granted that we are already always doing so.”

International trade means conducting business across national borders, and that usually means that a significant difference in culture needs to be accounted for when dealing with these counterparties. Being able to put one’s viewpoint aside and consider the world from a different perspective is a critical success factor for those engaged in international trade.

“A big misstep made by many new export companies, is that the company does not have a solid footing in business in the U.S.  In order to be successful in exporting, it is a good idea to have a market in the U.S. first and to be profitable,” said Warren Banks, International Trade Advisor at the CLIMB Small Business Development Center.  Banks notes that small businesses need to have management/owner support and commitment to the export market and they should anticipate several years of costs associated with exporting before seeing a profit from overseas sales. Solid research and a plan for each country’s market are also critical.  “Good research is a key factor, it will, among other things, tell the company if its product might be successful in a new market, or how much modification is needed,” noted Banks.

Here is a list of the top ten issues small businesses encounter when “going global,” according to Tammy Marquez-Oldham, Director of the Small Business Development Center at CLIMB:

1. Lack of management support to sell into the international market

2. Lack of market research to support expansion into international marketplace and identification of international customer

3. Lack of understanding of political, economic, cultural, natural and governmental risks, regulations, and requirements in the international market

4. Inadequate supply chain support related to exporting and supply chain management

5. Inadequate cash flow to support the expansion to the international market

6. Lack of understanding of trade finance and structuring the sales contract to terms which support cash flow requirements.

7. Inadequate capacity and capability to produce or retrofit products for the international market

8. Lack of knowledge about product/commodity classifications and harmonized codes

9. Lack of understanding of freight forwarders and how to work effectively with them.

10. Lack of understanding of U.S. Regulatory requirements and restrictions

“Knowing the challenges and pitfalls should not discourage companies from starting down the path of exporting.  Small business owners in the Portland area have a variety of expert resources to choose from as they are thinking about global expansion,” noted Marquez-Oldham.

The CLIMB Small Business Development Center (SBDC) at Portland Community College provides two great options: 1) Before You Go Global; and 2) International Trade Small Business Management Program.

Before You Go Global is an interactive training provided online to help companies weigh the costs of global expansion with the benefits of entering the international market.  Before You Go Global will help you consider opportunities and threats of taking your business global. Modules include topics on Global Business Management, Global Marketing, Supply Chain Management, and Trade Finance.

Another resource provided by the SBDC is the International Trade Small Business Management Program.  Whether your company is new to market or an experienced global trader, the International Trade Small Business Management Program offers a comprehensive approach to international trade.

This 10-month training program is facilitated by professionally accredited global business professionals. In the program you will be connected to resources like the U.S. Export Assistance Center (USEAC), the Small Business Administration (SBA), and Business Oregon. These agencies work with the SBDC to connect small business owners to valuable resources, trade information, and local business professionals experienced in global trade.  To learn more about the International Trade programs at the CLIMB Small Business Development Center at Portland Community College email sbdc@pcc.edu.