Managers are finding that expanding into today’s global economy is not only an opportunity, but also a necessity for survival.
This new awareness was demonstrated at a roundtable discussion on Thursday featuring Governor Gary Herbert’s chief of staff and prominent business leaders which was held to explore ways businesses can venture outside the country.
“Global commerce is a big topic right now, especially under the current economic circumstances we’re under,” said Brian Chandler of MultiLing, a Provo-based translation company that hosted the event. “Hopefully this discussion (has given) us a few ideas we can work on.”
Notwithstanding their new awareness of the need to expand, many business leaders find that venturing into a new market is more intensive than they first realized.
“It’s a challenge to export,” said Lew Cramer, president and CEO of World Trade Center Utah.
“You have to do it in another language in another currency. Importing is easy. You write a check.”
Utah may be the best place from which to export and expand internationally.
“Despite how difficult (the economy) is, there is not a state in the country that wouldn’t switch places with us,” said Jason Perry, Herbert’s chief of staff. “We get calls almost every day of the week from governors of other states talking about things that have been happening in Utah that we’ve used to position ourselves.”
Perry also cited the American Legislative Exchange Council as having labeled Utah as being poised to be the first state out of the recession.
“We have used federal stimulus money for projects,” Perry said, saying that most states have been using that money to make payroll.
“We’re not eating our seed corn; we’re using it to grow the crops of the future.”
One reason Utah is well positioned to come out of the recession is that international business is already a major part of its economy.
“It’s important to realize that if companies put all their eggs in one basket, when the economy goes down, they’ll be in trouble,” said Franz Kolb, director for Europe at the governor’s office of economic development.
“Our goal in this state is to have everybody thinking globally,” Cramer said. “Last year, a third of our economy was based on international trade.”
The panel agreed that some companies are prone to serious mistakes like relying on the Internet when expanding into an international market.
“A lot of companies try to do international business on the cheap, and it’s not going to work,” Kolb said. “Sooner or later, you’ve got to go over and meet with these people face to face.
You’ve got to go over and break bread and show a commitment.”
According to Kolb, translation is another area businesses don’t take seriously enough.
“Just because you’ve learned (a language for) one year of high school or had a religious experience for two years in another country doesn’t really mean that you speak the language and you can sell a product overseas.”
Mark Madrian, managing director of Ceteris Inc., says there are lots of great opportunities for companies to go global, but they need to be careful.
“You do have to go back and think, ‘How am I going to structure this and what is it going to mean for me five years down the road?’”