Market Information: How to Find It and
Use It
Stephanie Summers-O'Neal
How to Assess Whether Your Product is Ready to Compete In a Foreign Market
1. Is your product successful in the domestic market? If so, there is a good chance that it will also be successful in the foreign market.
2. Are there any unique or important features of your product? If so and those features are hard to duplicate abroad, then it is likely that you will be successful in the foreign market. A unique product may have little competition and the demand may be high.
3. Did your product once have a large market domestically, but is now declining or has already declined? If so, your product still may have a sizable export market. Other countries may still have a need or use your product.
How to Identify a Foreign Market for Your Product
Look for foreign markets that have the best potential for your product:
Two Types of Research to Identify the Best Market
Primary: you collect data directly from the foreign marketplace through interviews, surveys, representatives and potential buyers. (This process is time consuming and expensive, but can give specific answers for specific questions.)
Secondary: you collect data from various sources, such as trade statistics for a country or product. (This process is less expensive and helps you focus on marketing efforts. But, this process can be limited to the most timely information and may be too broad.)
Recommendations for Obtaining Useful Secondary Information
1. Keep abreast of world events
2. Analyze trade and economic statistics
3. Obtain advice from experts:
a. Export Management/ International Trade Management Companies
b. USDA FAS
c. USDA Trade Assistance and Promotion Office
d. State Departments
e. Department of Commerce
f. Small Business Administration
g. World Trade Centers
h. Trade Associations
i. Chambers of Commerce
Making the Export Decision
Exporting is a logical extension of your domestic business operations. In fact, exporting is not much different from expanding into a new market region domestically. Exporting can mean business growth, and business growth means more jobs. Yet, only a small percentage of potential exporters take advantage of these opportunities. It is critical for U.S. businesses to think globally.
Exporting can help your business:
Disadvantages to Exporting:
1999 Outlook for U.S. Agricultural Exports
Global economic crisis significantly affected U.S. agricultural exports in 1998 which fell 6% to $53.6 billion. Crisis is not over and exports expected to fall by another 6% in 1999. Currently 25% of world is in recession, mostly in Asia though Latin America will weaken in 1999. Unemployment way up, middle class has contracted, and consumer confidence is weak. GOOD NEWS: Exports are down, but U.S. share is holding which bodes well quick recovery once crisis is over.
Most of the damage has been to bulk commodity prices. Plentiful supplies, weak demand, strong dollar pushed prices to 20 year lows in 1998. Weak prices to continue in 1999, which will further reduce the value of bulk exports.
Consumer food products fared better than expected in 1998, thanks to strong/stable sales to Canada, Mexico, EU-15 and even Japan. However, exports in major markets will hurt horticultural products, poultry and some processed grocery products.
Beyond 1999: When will crisis end and export growth resume? Foreign capital starting to return to non-Japan Asia, interest rates are dropping, and currencies have stabilized. If the crisis is contained in Brazil, 2000 should be a year of recovery. If not, Latin America could join Asia in recession, triggering first global recession since the mid-1980s. Ag export recovery would be delayed further.
Authors' Mailing Address: Chief Executive Officer, Diversified Trade Company, LLC, P.O. BOX 55547, Jackson, Mississippi 39296-5547. Phone: 601-981-7559. Facsimile: 601-366-4059. E-mail: sumoneals@worldnet.att.net