The Secret to International Success
In today’s economy, international markets offer tantalizing possibilities for growing a business. The best way to capitalize on those opportunities? Find the right local partner, according to Alexander Gordin, international business expert and managing director of Fluent in Foreign, who spoke at NYER’s annual International Business Opportunities Conference, sponsored by Citibank.
Once you’ve done your market research and determined the best country for your company’s expansion, it’s time to exercise the same due diligence in finding a partner, Gordin says. His advice:
Know What Makes a Good Partner
A wrong partner, says Gordin, doesn’t just mean one who is dishonest or incapable of doing their job; the wrong partner can also have different goals or ambitions from you, a desire for power or control, or an inability to communicate efficiently. In order to avoid picking the wrong partner, he advises business owners to be aware of the cultural gap between doing business in America and the rest of the world. Be wary of a personality clash due to different cultures; traditionally, Americans are thought of as more forceful and direct when it comes to doing business, which may not mesh well with the way business is done in the country you are expanding to.
So what are the traits you should look for in a partner? The most important qualities are loyalty and integrity, Gordin says. Then, look for someone who has the ability to get things done, is professional, and shares your values and goals for the company. Your partner will be your company’s representative in a foreign country. He or she should be able to recruit and manage staff and look out for your company’s best interests when it comes to financial matters, as well as understand the value of your brand and your reputation.
Where to Look
“Finding a partner is 99 percent luck and 1 percent hard work,” says Gordin. Start your search by seeking recommendations from the U.S. Commercial Service and chambers of commerce, engage local lawyers and auditors, and get involved with local industry associates. Visit appropriate trade shows and conferences, and, if possible, ask for recommendations within your networks. Above all, you should always keep your eye out for a potential opportunity: “You’ll be surprised at the partners you can find in the most obscure places,” says Gordin. Look beyond a candidate’s resume and experience; it’s sometimes easier to train someone from scratch if they have the right attitude.
Next Steps for a Strong Candidate
Check the candidate’s references, learn his or her personal history and what drives him or her to succeed. Gordin also recommends getting to know the potential candidate’s friends and family to better understand him or her.
At the beginning of the relationship, provide your partner with as much one-on-one, in-depth training as possible. Go together on local sales calls, invite the partner to visit your offices in the US, and spend leisure time together to get to know him or her personally. “There is not going to be a substitute for a personal relationship,” says Gordin. Phone and internet contact can’t replace one-on-one interaction. “When there’s a dispute or a problem, that’s when your relationship will come in.”
Have a Contingency Plan
Even as you build a solid personal relationship with your partner, caution is advisable. Gordin recommends that you set up trial periods with realistic milestones and definitive goals. Negotiate agreements that are only renewable when a goal is met. When that goal is completed, then you can evaluate his or her performance and make adjustments. Create a “trust but verify” work relationship by developing fiscal and business reporting procedures and examining all important documents on a routine basis.
It’s also important to have a Plan B if your partner doesn’t work out. Make sure that all distribution and intellectual property agreements are in your company’s name. Have your signature on all local bank accounts, and get to know the local bank managers if you can. Although your partner is your company’s representative abroad, make it clear to your company’s local customers, vendors, and service providers, and with employees that you are the owner of the company—if possible, be the one who gives your local employees bonuses. Decide what will happen if your partner is unable to work because of an accident or an illness, or if he or she proves to be untrustworthy. And whenever you have to, don’t be afraid to make adjustments—no strategy is foolproof.