Chapter 9: SELLING OVERSEAS

Many successful exporters first started selling internationally by responding to an inquiry from a foreign firm. Thousands of U.S. firms receive such requests annually, but most firms do not become successful exporters. What separates the successful exporter from the unsuccessful exporter? There is no single answer, but often the firm that becomes successful knows how to respond to inquiries, can separate the wheat from the chaff, recognizes the business practices involved in international selling, and takes time to build a relationship with the client. Although this may seem to be a large number of factors, they are all related and flow out of one another.

RESPONDING TO INQUIRIES

Most but not all, foreign letters of inquiry are in English. A firm may look to certain service providers (such as banks or freight forwarders) for assistance in translating a letter of inquiry in a foreign language. Most large cities have commercial translators who translate for a fee. Many colleges and universities also provide translation services.

A typical inquiry asks for product specifications, information, and price. Some foreign firms want information on purchasing a product for internal use; others (distributors and agents) want to sell the product in their market. A few firms may know a product well enough and want to place an order. Most inquiries want delivery schedules, shipping costs, terms, and, in some cases, exclusivity arrangements.

Regardless of the form such inquiries take, a firm should establish a policy to deal with them. Here are a few suggestions:

Reply to all correspondents except to those who obviously will not turn into customers. Do not disregard the inquiry merely because it contains grammatical or typographical errors, which may result from the writer knowing English only as a second language. Similarly, if the printing quality of the stationery does not meet usual standards, keep in mind that printing standards in the correspondent's country may be different. Despite first impressions, the inquiry may be from a reputable, well-established firm.
Reply promptly, completely, and clearly. The correspondent naturally wants to know something about the U.S. firm before doing business with it. The letter should introduce the firm sufficiently and establish it as a reliable supplier. The reply should provide a short but adequate introduction to the firm, including bank references and other sources that confirm reliability. The firm's policy on exports should be stated, including cost, terms, and delivery.
Enclose information on the firm's goods or services.
Send the reply airmail. Surface mail can take weeks or even months, whereas airmail usually takes only days. If a foreign firm's letter shows both a street address and a post office box, write to the post office box. In countries where mail delivery is unreliable, many firms prefer to have mail sent to the post office box.
When speedy communication is called for, send a fax. Unlike telephone communications, fax may be used effectively despite differences in time zones and languages.
Set up a file for foreign letters. They may turn into definite prospects as export business grows. If the firm has an intermediary handling exports, the intermediary may use the file.
Sometimes an overseas firm requests a pro forma invoice (see chapter 10, Pricing, Quotations and Terms), which is a quotation in an invoice format. It is used rarely in domestic business but frequently in international trade.

SEPARATING THE WHEAT FROM THE CHAFF

How can a firm tell if an overseas inquiry is legitimate and from an established source? A U.S. company can obtain more information about a foreign firm making an inquiry by checking with the following sources of information about foreign firms:

Business libraries. Several publications list and qualify international firms, including Jane's Major Companies of Europe, Dun and Bradstreet's Principal International Business, and many regional and country directories.
International banks. Bankers have access to vast amounts of information on foreign firms and are usually very willing to assist corporate customers.
Foreign embassies. Foreign embassies are located in Washington, D.C. (see appendix IV), and some have consulates in other major cities. The commercial (business) sections of most foreign embassies have directories of firms located in their countries.
U.S. Department of Commerce. Commerce can provide information on international firms through its WTDRs (see chapter 7, Making Contacts), which are available for a fee through any local Commerce district office (see appendix III).
Sources of credit information. Credit reports on foreign companies are available from many private sector sources, including (in the United States) Dun and Bradstreet and Graydon International. For help in identifying private sector sources of credit reports, contact the nearest Commerce district office. Firms insured by the Foreign Credit Insurance Association (FCIA) can also obtain help from FCIA's headquarters in New York City (telephone 212-306-5000).

BUSINESS PRACTICES IN INTERNATIONAL SELLING

Awareness of accepted business practices is paramount to successful international selling. Because cultures vary, there is no single code by which to conduct business. Certain business practices, however, transcend culture barriers:

Answer requests promptly and clearly.
Keep promises. The biggest complaint from foreign importers about U.S. suppliers is failure to ship as promised. A first order is particularly important because it shapes a customer's image of a firm as a dependable or an undependable supplier.
Be polite, courteous, and friendly. It is important, however, to avoid undue familiarity or slang. Some overseas firms feel that the usual brief U.S. business letter is lacking in courtesy.
Personally sign all letters. Form letters are not satisfactory.

Before traveling to a new market, the traveler should learn as much about the culture as possible to avoid embarrassing situations. For example, in Mexico it is customary to inquire about a colleague's wife and family, whereas in many Middle Eastern countries it is taboo. Patting a U.S. colleague on the back for congratulations is a common practice, but in Japan it would be discourteous. Clothes, expressions, posture, and actions are all important considerations in conducting international business.

Another important consideration is religious and national holidays (see chapter 8, Business Travel Abroad). Trying to conduct business on the Fourth of July in the United States would be difficult, if not impossible. Likewise, different dates have special significance in various countries. Some countries have long holidays by U.S. standards, making business difficult. For example, doing business is difficult in Saudi Arabia during the month of fasting before the Ramadan religious festival.

Numerous seminars, film series, books, and publications exist to help the overseas traveler. Try to obtain cultural information from business colleagues who have been abroad or have expertise in a particular market. A little research and observation in cultural behavior can go a long way in international commerce. Likewise, a lack of sensitivity to another's customs can stop a deal in its tracks. Foreign government consulates in U.S. cities offer a wealth of information on business customs and norms for their countries.

BUILDING A WORKING RELATIONSHIP

Once a relationship has been established with an overseas customer, representative, or distributor, it is important that the exporter work on building and maintaining that relationship. Common courtesy should dictate business activity. By following the points outlined in this chapter, a U.S. firm can present itself well. Beyond these points, the exporter should keep in mind that a foreign contact should be treated and served like a domestic contact. For example, the U.S. company should keep customers and contacts notified of all changes, including price, personnel, address, and phone numbers.

Because of distance, a contact can "age" quickly and cease to be useful unless communication is maintained. For many companies, this means monthly or quarterly visits to customers or distributors. This level of service, although not absolutely necessary, ensures that both the company and the product maintain high visibility in the marketplace. If the U.S. exporting firm cannot afford such frequent travel, it may use fax, telex, and telephone to keep the working relationship active and up to date.

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