Category Archives: Market Research

WTO’s Newest Toy

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The World Trade Organization has launched a marvelous new tool for those of us who are graphically inclined, called the “International Trade and Market Access” interactive tool. It is a lot cooler than that bureaucratic title makes it sound. This is an interactive tool that graphically and geographically displays the latest available trade statistics and tariffs from countries all over the world. Here’s a sample that shows applied tariffs on agricultural products:

Average tariffs applied to agricultural products

The tool instantly tells you a tremendous amount about trade policies toward agriculture in all corners of the world. The darker colors represent higher applied customs duties. When you move your cursor over the live WTO version, the average applied tariff for each country pops up, telling you instantly who the protectionist countries in the world are for this sector. For the record, Egypt is by far the most protective against agricultural products, assessing a whopping 66.3%. If Cairo should ever want to reduce consumer prices for food, here is an obvious opportunity! This map explains at a glance why India and South Korea are so reluctant to compromise on agriculture and why Australia pushes for ever-freer trade.

You can set the tool up to display everything from total trade flows, import or export, to trade in a variety of sectors and sub-sectors, and – as shown above – the average tariffs for each of those. Note: the tool can show either average applied tariffs (what you are likely to see at the border) or tariffs as they are legally bound under the WTO (mostly of interest only to negotiators). The stats go back to 1980, so you can take a long look at important trends, too. And you can break things down by region and country. I am still playing with it, but the toy is fun!

Best Ways To Find U.S. Suppliers

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I posted yesterday about how businesspeople overseas can find good suppliers from the United States. This comes from a webinar I recently did, in which other presenters covered finding suppliers at trade shows or using Commercial News USA. I love trade shows and definitely include them among my favorite ways to find American business partners.

Today, I look at using American Chambers of Commerce and American Embassies to find U.S. partners. American Chambers (colloquially known as AmChams) are found in more than 100 countries. Many people assume, because this is the way it works in their countries, that AmChams are somehow connected with the U.S. Government. No way! AmChams are private sector, non-profit organizations loosely affiliated with the U.S. Chamber of Commerce. The U.S. Chamber is located in Washington, DC so that it can lobby the U.S. Government, the White House and the Congress. That means the U.S. Chamber often disagrees with the U.S. Government, so don’t assume that an AmCham is a shill for U.S. policy.

At the same time, don’t assume that every AmCham overseas is going to help you find U.S. suppliers of the goods or services you are looking for. Some AmChams are well financed with professional staff, others are small – dependent on volunteers who have day jobs they get paid for. If an AmCham has a member who has the product you seek, they will probably direct you to that member. AmChams exist to help their members, so they may not help you find a company that competes with a member. They may be eager to help you if they think that could lead to winning a new member. The bottom line is that you should talk to your local AmCham. They may help or they may not. They are different everywhere.

American embassies or consulates can be your most powerful ally if you are looking for U.S. suppliers. After all, part of their mission is to do whatever they can to boost American exports, so you might as well take advantage of that. When you contact a U.S. embassy or consulate, ask for the commercial section. Or ask for the agricultural section if you are looking for agricultural or food products. Most U.S. embassies have one or both of these sections. They also have an economics section that may be able to help you in the absence of a commercial or agricultural section.

Friendly commercial section in Singapore

Commercial sections are staffed by specialists, both American and from the host country, who know how to locate U.S. suppliers. Same for the agricultural sections. They don’t charge you anything for their help, and it can impress a marketing manager back in America if they hear from an American embassy about their product. In larger embassies, there may even be somebody who specializes in your industry and knows the U.S. companies personally. They may well know when visitors from these companies are coming to your country, or which firms will exhibit at an upcoming trade show. They can help you if you decide to travel to the United States to visit a trade show or see a company. While they cannot issue you a U.S. visa themselves, they may be helpful if you need to talk to the consular section about a visa.

If the commercial section can’t find a quick answer for you, they are in touch with a network of 109 offices in the United States and can alert them that you are looking for a particular product. Those offices, like the commercial section, are part of the U.S. Department of Commerce and they have incredible contacts in their communities. If you only use one method to find American suppliers, my strong advice is to use the commercial or agricultural sections at your American embassy.

Finding U.S. Suppliers

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Having a ball at trade shows

I made a webinar presentation a couple weeks back in which I spoke about how to find good U.S. suppliers if you are outside the United States. The speakers before me addressed publications like Commercial News USA and also using trade shows, both international and in the United States, so I avoided going over the same ground. For the record, I think CNUSA is great because you know that these are companies that are actively interested in finding overseas customers, agents or distributors – so they are very likely to respond if you get in touch with them. And I love trade shows, which are fantastic sources for finding suppliers, seeing what your competition is up to, getting new ideas, and meeting new business partners.

So I talked about other ways to find U.S. suppliers, starting with the sources I like least and saving the best for last. I don’t know about you, but when I am looking for information, the first thing I usually do is google it. (Nothing against other search engines, but there is a reason Google has become a verb.) Two problems with Google. Everything depends on how you structure your search. If you ask for the right thing, you get good results. If you don’t, you don’t. This can be compounded if you have to search in English and American English isn’t your native tongue. And then there is the quality of the results. How do you tell which ones are really good? If you are looking for a generic product to represent, you may find less-than-desirable middlemen who have paid to get their sites near the top of the search findings. Things are easier if you want a specific brand; just go to the website for that brand. So, use Google and its competitors, but be conscious of their limitations.

Then there are the portals and the B2B websites. Remember when we had high hopes for this sort of site? Maybe my experience is unusual, but I have never seen real business done through one of these sites. When you let people know you have product, suddenly everybody wants to represent you. If you let word spread that you are looking for a product, suddenly everybody claims to have it at the best price. I went on one of these sites recently and found people trying to sell me an iron ore mine in Brazil or a titanium mine in Peru. Another wanted agents in Spain, Brazil, the UK and Russia, but never said what for. Sometimes, things just don’t smell right. Your mileage may vary, but be careful out there, folks.

A recent phenomenon is the rise of “Buy U.S.A.” websites. These are sites aimed at American consumers who, for their own reasons, want to confine their purchases as much as possible to American products. You can easily recognize the sites because they usually have U.S. flags, bald eagles and U.S. maps prominently displayed. They seem to pop up in the aftermath of a recession when people are in a protectionist mood, and they are exacerbated because this is an election year. You might get some ideas for products, but I would go directly to the manufacture to talk business.

Now we get to what I regard as serious tools for finding U.S. suppliers. The old standby is the venerable Thomas Register, first published in 1898. The modern version is www.thomasnet.com. You can find just about any industrial product made in the United States through Thomas. You may not find all the consumer goods you want. Nor will you find agricultural and food products. But you will, for instance, find everything that a farmer or a food product manufacturer needs to do their business. The downside of Thomas is that you don’t know if the companies are interested in exporting, so you still have to make the cold call and find out. That said, I love the Thomas Register.

Industry associations and the specialized trade press should not be overlooked. There are many association directories online and I can’t recommend one above the others. There are more associations than you can imagine and each one works differently. The one thing they are likely to have in common is that they all want to help their members make sales. So, if you are looking for popcorn, there may not be a better source than the American Popcorn Board. There is probably an industry association or trade publication in any industry you can imagine.

Come back tomorrow when I’ll get to two of my favorites for finding U.S. suppliers.

Mapping Supply Chains

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I happened across Sourcemap this weekend and I suspect it may become an important tool for any business researcher. Sourcemap is a crowd-sourced directory, using maps of the world, countries or regions, that show where a product’s components come from. Though many companies may think this is revealing a bit too much about how they do what they do, many others will see it as a great way to communicate with customers and and keep them involved with the product. Sourcemap is focused on supply chains and environmental footprints, but I see no reason why their mapping and crowdsourcing technology cannot be expanded to much, much more.

Consumers use the site to learn about where products come from, what they’re made of, and how they impact people and the environment. Companies use Sourcemap to communicate transparently with consumers and tell the story of how products are made. Thousands of maps have already been created for food, furniture, clothing, electronics and more.

Working trade shows can destroy your feet, so I have a strong interest in ECCO shoes. I once worked a show in Germany, on my feet for twelve or more hours a day for nine straight days, and ECCOs were my salvation. So I was interested to see what Sourcemap had on ECCO – as an example of what they can do. Here’s the result:

Ecco Shoes supply chain

It is early days, but Sourcemap shows all the signs of becoming indispensable. But go play with it yourself.

Market Research Is Sexy, Right?

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I wish. Much of it is drudgery, but it can be a wonderful intellectual puzzle. Which is why I normally enjoy it. Much of the research I do for companies requires teasing out bits of information from sources that aren’t always meant to be used for market research. In fact, many of the sources I look for aren’t labeled as “market research” and might not always be recognized as useful to companies thinking about a new market. I like to take a holistic approach, aiming to know not only what’s selling now and how to do it, but why it is selling. It is the combination of traditional market research with cultural, political, historical and other factors that can give you a clue to what might happen to a market in the future. That is much more important than knowing what happened to it last year.

WTO - your market research source? (photo by Lightmotif/Blatt)

One of the more unusual sources I use is the World Trade Organization’s Trade Policy Reviews of its member states. A Trade Policy Review (TPR) is essentially a non-adversarial peer group assessment of a country’s trade policies. The confrontational stuff, like dispute settlement cases, make their way into the press, but few people even know that TPRs exist. The typical TPR begins with an exhaustive research (there’s that word) piece put together by the WTO staff, followed by meetings with the subject country together with other interested countries. The research details the policies that the subject country uses, how they are implemented, and their impact on trade in or out. The staff paper is normally non-confrontational and perhaps too even-handed. That said, the secretariat can point out areas for improvement, as can participants in the actual TPR meeting that discusses the paper. The typical TPR meeting (which can stretch over several days) begins with two pre-designated discussants talking about the report. The country under discussion has ample opportunity to explain why and how it does what it does. Other member states can ask questions and make suggestions. In the process, you can gain a really complete understanding of the county’s policies and how the place works. All very collegial. Usually.

TPRs are done more often on countries that play larger roles in world trade, so the United States and the European Union come up more often, say, than Botswana or Brunei. A typical TPR is going on in Geneva as this is posted – on Uruguay. The WTO staff paper is exhaustive, 194 pages chock full of information on Uruguay’s economy, overall trade and investment policies, individual trade measures and regulations, and policies on specific sectors. The paper is filled with more than you ever wanted to know about Uruguay and how the country works, and may have nuggets of information that could be key to your decisions on doing business there.

TPRs over the past twelve months include United Arab Emirates, Philippines, Nepal, Trinidad & Tobago, Turkey, Kuwait, Saudi Arabia, Thailand, Ecuador, Cambodia, Zimbabwe, Guinea, Mauritania, India, European Union, Nigeria, Canada and Paraguay. Did I mention that the TPR reports are available online? And that they are FREE?! I have seen fancy corporate market research outfits charge many thousands of dollars for information like this, so at least spend the amount of time it takes to check one out.

Selling Travel To Hawaii

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No aloha shirts! (Official White House Photo by Pete Souza)

I spent Wednesday at the Hawaii Tourism Authority’s spring market review. HTA pulls in its marketing contractors from “around the world” to tell the Hawaii visitor industry what is being done for them. I used quotes because HTA doesn’t market Hawaii globally. Hawaii’s official tourism marketing is restricted to the United States, Canada, Japan, China, South Korea, a little bit in Taiwan, Australia, a bit in New Zealand and a pittance in Germany and the United Kingdom. This is largely due to mythology that tourists won’t come unless they have direct flights.

While I am concerned about where Hawaii isn’t represented, the contract marketing people appear to be doing a pretty good job with the funding they have. Some have plenty (United States, Japan, China) while others bear up under the “do more with less” syndrome that afflicts governments everywhere. All in all, it’s a pretty creative bunch that ably cashes in on the “brand” that is Hawaii worldwide. I tweeted interesting tidbits during the event (@OldPaddler), but here are some more detailed notes about Hawaii’s international tourism efforts.

HTA’s message was upbeat. Yes, the recession hurt the tourism industry, but travel to Hawaii is rebounding and airline capacity to Hawaii is showing serious growth. The gaudy headline from 2011 is a 90% increase in capacity between Seoul and Honolulu, admittedly from a low base. Hawaiian Airlines added seats from Japan and Australia. Charter flights were launched from Shanghai, with continuing rumors of more to come. Hawaiian is starting non-stop flights to New York in 2012, which will give better connections to travelers from Europe. And, this May, little Mokulele Airlines will try a Honolulu-Chicago non-stop that will continue on to London Stansted. Talk about ambitious! Listening to David Uchiyama, HTA’s vice president for brand management, though, I came away with the read that it is the pre-existence of direct flights that governs where HTA spends its marketing dollars. While Uchiyama paid lip service to developing new markets, it was clear that if you can’t get to Hawaii without changing planes, he isn’t very interested. I have railed against that attitude for years because I have seen plenty of well-heeled, adventurous travelers who find hard-to-reach destinations among the most attractive. And they tend to spend a lot and stay a longer time.

Hawaii’s meetings market got a tremendous boost in 2011 when Honolulu hosted 21 heads-of-state and thousands of others for APEC in November. All those news broadcasts showing APEC delegates in tropical surroundings were gold for the tourism industry – and especially for the meetings industry. Hawaii has long been attractive for incentive travel, but has big problems when it comes to large meetings, conferences and trade shows. A major international trade show is a no-go in Hawaii simply because of shipping logistics. It takes a lot of time and even more money to move large, heavy exhibit materials and products to Hawaii – a disadvantage to being a paradise in the middle of an ocean.

Hawaii has done better with conferences and regularly attracts big groups in the medical and scientific fields. Cardiologists and dentists find us especially attractive. Honolulu has hosted the Pacific Telecommunications Council annually for many years, and there is a new annual green energy conference that shows considerable promise. But these big conferences aren’t as easy to come by as you might imagine. Randall Tanaka, assistant general manager of the Hawaii Convention Center in Honolulu, pointed out that a convention organizer has to really want to place an event in Hawaii because he is going to take a hit on attendance. Any Hawaii meeting or convention is going to be called a boondoggle by somebody, plus the industry still suffers from “AIG syndrome”, a backlash against seemingly exorbitant corporate travel. That, says Tanaka, gives destinations such as San Diego or San Francisco a strong advantage over Honolulu. He cited the example of the American Dental Association, which often comes to Hawaii despite the knowledge that they can draw twice the number of dentists if they meet in Las Vegas. Here’s the presentation on MICE travel. It’s big, takes a while to load.

One lesson from APEC that Tanaka and others can’t mention in public is that the travel cost and distance to Hawaii can minimize potential protestors if your meeting is at all sensitive. We saw this in spades with APEC. The November 2011 meetings were in the heyday of the “Occupy” movements and some predicted a tropical “Battle of Seattle”. Never happened. See my post on the “bikini protests“.

A similar point is that meetings can be held in Hawaii with relative anonymity. Working closely with the consul general for Japan, it took me years to convince the guys with green eye shades in Tokyo and Washington to use Hawaii as a site for bilateral trade negotiations. Our arguments were that neither negotiating team had to travel as far or get as jet-lagged as going to one of the capitols, that Honolulu cost less than either Washington or Tokyo, and that we could stage meetings that the press would never hear about unless we wanted the coverage. That is still largely true. We began holding bilateral trade talks in Hawaii in the mid-1980s, added more countries to the mix and, so far as I know, they still happen here. But nobody knows.

We’ll get into more country-specific tourism talk in upcoming posts.

Chocolate Secrets

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A businessman from Pennsylvania handed me a chocolate nut cluster. “I make the machines that make those,” he told me, “and I need your help“. Not quite Willy Wonka, but close.

Enjoying the chocolate, I asked what I could do. The first problem was straightforward, though it did take some effort. He displayed his chocolate nut cluster machine at a big food product manufacturing show in Germany. Everything was fine on the first day, even competing head-to-head with the German company who was his only real competitor. But the next morning several official-looking types came to his stand, accompanied by police, and taped up his machine with signs in German that said, roughly, “This machine is unsafe!“. He didn’t sell many after that, but nobody would tell him why his machine wasn’t safe. The U.S. Commercial Service staff in Dusseldorf figured it out. They went to the show organizers, who put them onto the local standards people. The German competitor had complained to them about the American machine and they duly found an unlocked maintenance hatch on the back of the U.S. product. The standards people said the door had to be locked. Once they knew what the problem was, it was easy to put a lock on the door and resume selling.

We couldn’t solve the second problem. Russia, then the Soviet Union, is a huge producer of chocolate. The U.S. company was approached by a Soviet trading company that wanted to buy a big order of the chocolate nut cluster machines for a factory near the Ural mountains. But, when asked how big an order, the trading company wouldn’t tell them. “Our production plans and capacities are state secrets,” they said. “Just give us your best price,” apparently not understanding economies of scale. So the chocolate nut cluster man came to Washington for help.

How much does Nestle make at this plant?

We’re talking about the Soviet Union, so these were the days before GPS or Google Earth. It turns out that somebody who really knows the chocolate industry can make a reasonable guess at a factory’s capacity by looking at the equipment on the factory roof. (You learn something everyday in this business.) All he needed was a photo of the roof and he could guess how big an order he should quote for. He knew where the chocolate factory was located and he knew that American intelligence organizations were taking satellite photos of Soviet industrial sites. Could the CIA let him see their photos of the Russian chocolate factory?

Good idea, but long before its time. No way was the intelligence community going to let anybody see what they were taking pictures of – or let outsiders see how good, or bad, their satellite photos were. I even promised a supply of chocolate nut clusters, but it was simply too early to marry the world of covert intelligence with the needs of market research. Never did hear if my friend, the chocolate nut cluster man, figured out how to make the sale.

Valentine’s Day. Thought you needed a nice romantic post about chocolate. Go eat a chocolate nut cluster.