How do you, as a US manufacturer, develop strategies for solving your most challenging problems? That was the subject of Fast Forward, a summit held in Plymouth, MI on June 21, 2012, presented by Industry Week, the Italian Trade Commission, and Machines Italia.
The highlight, for me, was the talk given by Peter Perez, Deputy Assistance Secretary, Office of Manufacturing, U.S. Department of Commerce, International Trade Administration. He addressed, straight up, what the U.S. – and really any country with manufacturing capacity – needs to focus on to generate revenue and profitability in today’s global economy. He provided me with a copy of his talk for reference in this blog post.
His bottom-line mandate to manufacturers: “Build it here and sell it everywhere.” Because 95% of the world’s consumers live abroad. “Manufacturing matters.”
What’s interesting is that in spite of all the internet and TV gloom and doom we are inundated with daily, the Financial Times reported on June 11 “…manufacturing in 2012 will reach its highest level for more than a decade as a percentage of total world output. So even in a difficult global economy, manufacturing is returning to its historic role as a growth driver.”
When you think about it, manufacturing matters because it:
- “accounts for 60% of our nation’s goods and services exports;
- creates more economic activity than any other sector. The multiplier effect of each manufacturing job creates jobs in the supply chain and in the service sectors;
- is responsible for 70% of the private-sector research and development and 90% of the patents in this country;
- supports good, stable jobs that pay – on average – 17% higher than non-manufacturing jobs; and
- these manufacturing jobs are more likely to receive employer provided benefits like medical care and a retirement package.”
Perez urged U.S. manufacturers to recognize the opportunities that globally competitive markets create for export, and not just to one or two countries. Exporting, for any country, is an essential tool for economic growth.
His strategic horizon for manufacturing includes:
- Strategic focus with sector/market –specific strategies
- Engagement with potential partners abroad
- Joining industry trade advisory committees
- Partnering with supply chain entities to assist your networks in increasing markets into which your goods and services are exported
I spoke with Mr. Perez briefly after his speech, told him I would blog about his talk, and asked him these questions. We ended up being on the same page.
Because what concerns me about the “selling it everywhere” part of the equation is: yes, you can build it here. But not the way you used to, back in the days before the economy collapsed. If you intend to use yesterday’s sales techniques and customer conversations to sell it everywhere, perhaps you should rethink your customer acquisition strategy.
Before you rush out to sell it everywhere in the post-recession economy, here are four tips for building your export strategy:
- If you build it, they may not feel obligated to show up. Will customers feel obligated to buy any one country’s, one company’s, or one sales or engineer’s goods and services any more than the other’s? Think about how you, yourself, make personal as well as professional purchase decisions. Are you fickle or loyal? Put yourself in the shoes of your customers and see things from their side of the bargaining table. What role can you take in creating a sense of excitement, anticipation and urgency in your potential customers’ buying decisions so that your products and services are chosen?
- If you sell it everywhere, they may not understand. If your company has a global platform, then you know what is involved to be a competitor. If you are a novice, learn the variables in the export equation before rushing out to compete globally. You’ve got countries and cultures and behaviors and a myriad of interlocking contexts to sort out before you even get close to selling your wares in the global marketplace. The national market place isn’t less discerning than the global one. Your competition these days is global, not local. Your global competitors have figured out which customer conversations produce the most rewarding results. Don’t assume that your local customers feel obligated to buy from local vendors. Keep in mind: the world indeed is flat.
- If you sell it, they may not be ready to buy. How many times have you gotten burned in your domestic sales strategy by assuming that you landed a deal? Just because someone wants to see you doesn’t mean they are ready to buy. Getting an appointment, making presentations are exciting opportunities for sales and engineering professionals. It’s sexy to tell your friends that you are going overseas to make a sales presentation. Know what you are getting into. The internet allows purchasing agents to do all of their research online. Are you serving the role of the third bidder in a three horse race, now overseas, where the winner has already been selected? Doing the same things the same way you are still doing them will yield the same results no matter where the location.
- If you perpetuate status quo mindset you are not being realistic. Is your company mired in a siloed business model which separates professional disciplines and mindsets? Are you a small business waiting for the tide to turn so that your customers come back? I wouldn’t be so sure that you will be thrown a bone for riding things out. Your current, non-collaborative status quo business model may be getting in your way. What steps would you take to retool, recalibrate and restructure so that you are prepared to be flexible and agile in the new globally competitive economic paradigm?
As Mr. Perez noted, there are abundant opportunities to compete for global business.
Do you have a feasible and viable strategy for building it here and selling it everywhere? What are you waiting for?