FTA Best Practices

1. Know Your Target Market

“It is critical to understand your market and the major focus of your business before you enter the international marketplace. Align yourself with strategic partners, find your niche in the marketplace and localize your products to meet the market demand.” — Canada Export Award Winner

The United States is not a single homogenous market. Remember, the United States is the third most populous country in the world, with over 300 million people located across fifty states spanning a territory as big as 3.79 million square miles. To put the size of these individual state markets into perspective, California’s Gross State Product (GSP) is equivalent to the Gross Domestic Product (GDP) of France, and Texas’ GSP is equivalent to the GDP of Canada. What this means is that the size of the US market should not be underestimated. It takes significant time, effort and resources to penetrate the market.

Given the sheer size and segmented nature of the United States, the needs and desires of its population are not likely to be the same across the country. People from California will nott have the same preferences for goods as people from New York. Different industries are concentrated in different regions. The manufacturing heartland of the US are the Mid West states of Illinois (Chicago), Michigan (Detroit), Ohio and Indiana. Chicago is a major transportation hub for agricultural and industrial products. In addition, different regions have different climatic conditions such that different woods will be used for outdoor furniture in Florida versus New Hampshire.

What this means to the Omani exporter is this: a thorough understanding of the US market and a clear definition of your target market within the United States is crucial and imperative to export success. A shotgun approach to the US market is unlikely to be effective and will only dilute the impact of your company’s finite resources.

Market research is the process of systematic and objective collection and analysis of data about a particular target market, the competition in that market and the general environment. It incorporates data from secondary research (or desk research) as well as primary research (which involves collecting data directly from respondents). The basics of market research include the following:

Finding Potential Markets. Obtain trade statistics that indicate which states import your products. Perform a thorough review of the available market research reports in the states and industries in question to determine market openness, common practices, tariffs and taxes, distribution channels, and other important considerations. Identify fast-growing markets for your product(s). Analyze them over the past three to five years for market growth in good and bad times. Identify some smaller but fast-emerging markets where there may be fewer competitors. Target three to five of the most statistically promising markets for further assessment.
Assess Targeted Markets. Examine consumption and production of competitive products, as well as overall demographic and economic trends. Determine the sources of competition, including the extent of domestic industry production and the major foreign countries you would compete against. Analyze factors affecting marketing and use of the product in each market. Determine whether your product is price competitive.
Draw Conclusions. If the company is new to exporting, it is probably a good idea to target two or three markets initially.

For more information, refer to the section on frequently asked questions, number 9: How do I identify current trends and competitors in my sector?

2. Know Your Customer

“The absolute fundamental aim is to make money out of satisfying customers.” — John Egan

In order to identify and narrow your target markets you need to first know who your target customers are. It would not be wise to try and market your product without having defined your target customers first. It usually ends up to be a waste of valuable marketing money. Knowing who they are will help to make your export plan and marketing strategy more effective. You’ll be able to make better decisions about where your product would have the best chance for sales, what marketing channels should be used (newspaper ads, billboards, TV or radio commercials, etc.), and which value proposition would persuade your target customer most easily. Some suggested steps in knowing your customer are as follows:

Understand your product first and foremost in order to identify who your target customers are. What are all the features of your product? What benefits do they provide? What need to they satisfy? Does this product need to be modified in any way to satisfy the target customers?
With a thorough understanding of your product’s features and benefits, you can start to list target customers by narrowing down who need these benefits the most. For example, if your item is lightweight, portable, and comes in a variety of fashionable colors, it could be that working mothers, or people who work in a fast-paced work environment will benefit most from the features offered by your product. It can be useful to start with asking who the current domestic customers for your product are and how are they different or similar to US customers.
Narrow your target customer list down as much as possible.This will help you focus your marketing efforts and appeal to them in a much more personal and direct way – a marketing campaign geared to working mothers will likely not be the most effective.
Find out where these people are. As mentioned in other sections of this toolkit, the US is not one market, but many markets with varying preferences and needs. New Yorkers will have different preferences and needs than Texans. Narrow down where your target customers live and you’ll be able to target contacts and buyers in that area.
Find out as much about their preferences and trends as possible. What are their buying habits and preferences for similar products? Where do they spend their time, what do they like to do on the weekends, do they read the paper or get their news and information from the internet, do they watch cable television, etc. This will help you find the best mode of communication and the message to deliver.

It is also important to know if there are significant imports of similar products to the US. To what specific markets in the US? What is the customer profile in those markets? How much will you have to modify your product to appeal customers in the US market? What are the competitive advantages of your product as well as those of your competitors?

This information should be collected when conducting your market research. For tips and information on market research approaches, please refer to the previous best practice or to the section on frequently asked questions, number 9: How do I identify current trends and competitors in my sector?

3. Know Your Value Proposition

“Keep in mind that your the purpose of your value proposition is to identify and satisfy an unmet need that your target market possesses.” — Laura Lake

What will your customers get for their money? Why should they spend their hard earned money on your product? What do your target customers want that your product or service can provide? Why is your product better than the competitor’s version? To develop your value proposition, it is best to start by brainstorming and focusing on what needs your target market have in common. Once you’ve found the common denominating need, you can determine what it is they are in search of and develop your value proposition around that need.

How you frame your message and portray your product to your customers can make or break your marketing strategy. The right balance must be struck between appealing in a personal and direct way to your target customers while also making it general enough to appeal to other potential customers outside of your chosen strike zone. An effective and well-written value proposition informed by solid understanding of both your product and your target customer is a necessary element of effective sales. Developing and defining your value proposition will help shape your marketing strategy and appeal to your target customers. The ingredients of an effective value proposition are:

Know your product. As emphasized in the ‘Know Your Customer’ section, it is important to list the features of your product and turn them into benefits. Your value proposition will be based on selling highlighting the benefits to your target customer.
Know your target audience and their needs. What needs do your customers or target demographic have? What is it they want that you can provide? How does your product fill that need? These questions will help you define your offering. The purpose of your value proposition should be to fill a need in your target market.
Know your competition and market perceptions. It could be that your product is fast but if your customers think another product is faster, then your promoted value proposition will not connect with your customers. You’ll need to determine what your products competitive strengths are and promote a value proposition based on them that is aligned to what the customers value.
Be clear and concise. Your value proposition should be well-written, clear, concise, and effective. It should be compelling sales pitches that convey the essence of the product and how it satisfies a need. It should resonate with your customers. In order to be effective you will need to tailor your message to your demographic. A value proposition that would be effective on a young and trendy population would not work as well for an older target audience.

Developing a compelling value proposition is important for the following reasons:

Create a strong differentiator between your product and that of your competitors
Increase the quantity and quality of prospective leads
Gain market share in your targeted segments
Assist you in enhancing tools that will help you close more business
Improve your operational efficiency

Start developing your value proposition today. Remember that an effective value proposition describes what you do in terms of tangible business results. It draws interest and shares a success story within a few words.

4. Know Your Capabilities

“First of all, do your homework and know yourself. Realize that exporting is a commitment for a long, long term. Know your strengths…” — Exporter

By now, you have identified a specific target market or market segment in which your product can be successful, you have a better understanding of the tastes and preferences of your US customer. You have defined your value proposition and know the value that your product or service will bring to the US market. The next step is to understand your company’s existing capabilities to meet the demands of exporting. Is your company export-ready?

That is, does your company have the management commitment, the financial, human and production capacity to meet the demands of the US market? Determine whether this is true of your company — and if it isn’t, how to make it happen. Your first step is to think truthfully about the resources and knowledge your business already has. Evaluating your company’s export readiness entails asking questions that include the following:

Management Commitment: Is senior management willing to devote a significant amount of resources (time, financial, human capital) to the export drive and is it willing to stick to this export strategy for the long-term? Do you have clear and achievable export objectives? Do you have a realistic idea of what exporting entails? Is the company knowledgeable about the technical aspects of exporting?
Financial and Legal Resources: Do you have enough capital or lines of credit to produce your product or service? Can you obtain the working capital needed for any necessary expansion, such as staff or production space? Do you have enough cash flow to sustain you until payment for your goods or services is received? Can you find ways to reduce the financial risks of international trade? Can you effectively deal with different monetary systems and ensure protection of your intellectual property? Do you have the in-house resources or can draw upon external legal resources to navigate the different laws involved in exporting your product or service?
Human Resources: Do you have the human resources required to handle the extra demand associated with exporting? Do you have personnel with culturally-sensitive marketing skills and who can comfortably conduct business in the language required? Do you have the capacity to respond quickly to customer inquiries and concerns? Do you have personnel with computer and technology skills to conduct business efficiently?
Production Capacity: Does the company have sufficient production capacity to support the export market? Can the company supply adequate volume of raw material to meet bulk demands? Can the company handle a sudden rise in demand? Can the company adapt the product quickly to handle seasonal changes in color and design if appropriate? Can your company meet the quality standards imposed by the importing country? Can your company be flexible to meet changing trends?

For more information on assessing your company’s export readiness, you can refer to the section on frequently asked questions, number 2: What steps do I take to export to the United States?

5. Develop An Export Plan And Commit To It

By now, you’re a growing expert on the US market and have clearly identified your target market. Also, you have validated that your company has the resources and capabilities to export to the United States. The next step is to develop your export strategy which will be formally written into an export plan – and more importantly to commit to it.

Exporting is not a sideline that is meant to augment your domestic business. It is an entire business in itself that will require the solid commitment of senior management and all employees of the company. The Export Plan will encapsulate all the aspirations and activities related to exporting. Hence, while it should be the company’s exporting guidebook, it is a living and evolving document that should be constantly reviewed and updated.

An export plan is really like your business plan that emphasizes on international markets. The plan identifies your target market(s), export goals, necessary resources and expected results. Typically, an export plan should contain the following:

Introduction. Business history, vision and mission statement, purpose of the export plan, organizational goals and objectives, international market goals, short and medium-term objectives for exporting, location and facilities
Organizational issues. Ownership, management, staffing, level of commitment by senior management, relationship between exporting and other operations, corporate experience and expertise in exporting, strategic alliances, labor market issues
Products and services. Description of products and services, key features, adaptation and redesign required for exporting, production of products and services, future products and services, comparative advantage in production
Market overview. Market research, political environment, economic environment, size of market, key market segments, purchase process and buying criteria, description of industry participants, market share held by imports, tariff and non-tariff barriers, industry trends and other market factors, market outlook
Market entry strategy. Target markets, description of key competitors, analysis of competitive position, product positioning, pricing strategy, terms of sale, distribution strategy, promotion strategy/development of sales leads, description of intermediaries and partners
Regulatory and logistical issues. Intellectual property protection, other regulatory issues, modes of transportation and cargo insurance, trade documentation, use of trade service providers
Risk factors. Market risks, credit and currency risks, political and other risks
Implementation plan. Key activities, evaluation criteria and process
Financial plan. Revenues or sources of funding, cost of sales, marketing and promotion costs, other expenses or expenditures, operating budget, taxes

For more information about developing your export plan, refer to the section on frequently asked questions, number 2: What steps do I take to export to the United States?

6. Identify And Leverage Available Outside Resources

You have an export plan and you feel overwhelmed at everything you need to do. Stay calm and take a deep breath – you don’t have to do everything alone. There are programs and services out there available to help you.

In the research stage of export planning, you should actively identify and leverage resources and sources of assistance. Our objective here is to provide a general overview to exporters of the range of services available and is not intended to be a comprehensive or exhaustive reference point. Resources and services are available to exporters in the following areas:

Market Research. Market research is crucial in the development of a market entry strategy. Conducting thorough market research can help you choose the right markets for your business and can provide you with industry information, competitor activity or identify business opportunities.
Export Planning. Developing your International Marketing Strategy is essential whether you are new to exporting, a fully experienced exporter or seeking to develop an overseas joint venture. Once you have researched the market and are sure that it’s the right one for your business, you will need to develop an international marketing strategy and action plan.
Language and Culture Orientation. The language difference is one potential barrier between you and your customer. Language and communications should be part of your business strategy, which can include language skills, translations, website marketing and cultural awareness. By learning to communicate in a language your customer understands you should develop highly successful business partnerships.
Visiting the Market. You will need to travel regularly to your chosen overseas market to develop your business partnerships. Your visit may be to research the market, see your customers or agents, or attend or exhibit at a trade fair. Support to help you with your market visit is available whether you wish to travel alone or as part of a group and to ensure your overseas trip is a success.
Selling to the Market. Deciding on exactly how you are going to sell your goods to your chosen markets can be a difficult decision. The right method of market entry will depend on the level of investment your business is prepared to make, your product, market conditions, the demands of your customers, and the level of competitor activity.
Getting Paid. Obtaining payment for goods rarely takes place at the same time as the contract of sale. In an international transaction it usual to offer short-term credit of 30 – 90 days which can affect cash-flow. Choosing the right payment term requires an assessment of risk, adequate credit insurance and an appropriate payment term for you and your customer.
Export Pricing. Prices must be set to enable a company to achieve its marketing strategy to develop an overseas market. Different factors will determine a pricing strategy depending on economic and political factors, competitor pricing, consumer demand and the desired rate of return on the investment.
Access to Funding and Finance. There are a number of funded programs available in Oman to help promote international trade activity which your business may be eligible to apply for. These programs are provided by commercial banks such as Bank Muscat, Hong Kong Shanghai Bank and other banks such as Oman Development Bank.
Legal Issues. Selling your goods or services internationally opens doors for more complex legal issues then selling in this country. At some point you are likely to need advice on issues such as contracts or disputes, choices of venue, how to protect your intellectual property, brand rights and protecting against product liability.
Delivering to the Market. There are many factors that need to be taken into account when deciding how best to deliver your goods to your customer. These include the nature of the product, customer location and reliability, security, speed, cost and availability of the mode of transport. You will also need to ensure that you comply with packaging and labeling requirements, quality standards and that the goods are adequately insured in case of damage or loss in transit.
Documents and Procedures. Completing correct documentation and conforming to procedures is a vital function of the international trade process. Documents vary according to the different market, customer and customs requirements and inaccurate paperwork can cause costly delays to the shipment or to obtain payment. Shipping documents also provide evidence of the goods shipped and provide the mechanism against which payment is made.
Education, Training and Development. Training and developing employees involved in international trade should be an integral part of your business strategy. Your business training needs should be regularly assessed to improve the competitiveness of your business. International trade training is available in export finance, sales, administration, shipping, strategy development, languages or specifically to meet your business needs.

7. Know The Rules

Playing the game is easier when you know the rules.

Becoming a successful exporter means knowing the requirements, policies, and procedures of international trade and specifically your target market. Not knowing the rules can cost you time, money, and market access. The US market is vast and complex requiring a thorough understanding of the different rules that affect the export process. These rules include: trade barriers, export contracts, business laws and customs rules among others.

Know the Trade Barriers. It’s important to know as soon as possible if there are trade barriers that will affect your export. Barriers to trade refer to both tariffs and non-tariff barriers (NTBs). Tariffs are the duties applied to the import of your product into the US NTBs are measures or policies other than tariffs that restrict or affect international trade. These include the following:
- Import bans
- General or product-specific quotas
- Rules of Origin
- Sanitary and phyto-sanitary conditions
- Packaging conditions
- Labeling conditions
- Product standards
- Complex regulatory environment
- Additional trade documents (e.g., Certificate of Origin, Certificate of Authenticity)
- Occupational safety and health regulations
- Employment laws
- Import licenses
- State subsidies, procurement, trading, state ownership
- Export subsidies
- Fixation of a minimum import price
- Product classification
- Foreign exchange controls and multiplicity
- Inadequate infrastructure
- “Buy national” policy
- Over-valued currency
- Intellectual property laws (patents, copyrights)
- Seasonal import regimes
- Complex and/or lengthy customs procedures
- who is party to the contract;
- the contract’s validity conditions;
- the goods you will provide with specificity as to condition and volume;
- the purchase price of the goods and the terms for payment, inspection and delivery of the goods;
- where transfer of title to the goods takes place;
- any warranty and/or maintenance terms and conditions;
- who is responsible for obtaining import or export licenses;
- who is responsible for paying taxes;
- any contract performance security requirements, such as bank letters of guarantee;
- what to do if your buyer defaults or cancels;
- the provisions for independent mediation or arbitration to resolve disputes, and the venue (whether this would take place in the United States or elsewhere); and
- the contract completion date.In addition to the general provisions described in the previous section on goods contracts, your contract for exporting services should specify:
  It is also crucial to be absolutely clear about whose laws will govern the interpretation and enforcement of the contract: Will they be Oman’s laws or the laws of the United States?
  
  If the contract involves the licensing of proprietary, information or technology, it is important that the wording be very precise about the licensee’s rights. Vagueness can create serious problems and could lead to the loss of your intellectual property. Also—and this would seem obvious, but it is sometimes overlooked—be sure that all parties to the contract have signed it. For instance, if you are working through a representative, be sure that the actual buyer signs the contract. The representative’s signature is not necessarily enough, because without the buyer’s signature there is no written evidence that the buyer owes you money. Last, but certainly not least, have the contract examined by a lawyer familiar with the US export market.
  
  Know the Essentials of Export Contracts. Export contracts can be complicated since they are drawn up by countries with different legal and regulatory environments. Properly preparing and negotiating the terms of the contract can help to minimize the risks involved in trading internationally.The fundamental provision of the contract is that you the seller will transfer ownership of the goods to the buyer in return for payment. A clearly written, precise contract will greatly reduce the chances of disagreement between you and your customer. The rest of the contract details the terms and conditions for doing this. At minimum, the contract should include the following:
Know the Essentials of Export Contracts. Export contracts can be complicated since they are drawn up by countries with different legal and regulatory environments. Properly preparing and negotiating the terms of the contract can help to minimize the risks involved in trading internationally.
- who is party to the contract;
- the contract’s validity conditions;
- the goods you will provide with specificity as to condition and volume;
- the purchase price of the goods and the terms for payment, inspection and delivery of the goods;
- where transfer of title to the goods takes place;
- any warranty and/or maintenance terms and conditions;
- who is responsible for obtaining import or export licenses;
- who is responsible for paying taxes;
- any contract performance security requirements, such as bank letters of guarantee;
- what to do if your buyer defaults or cancels;
- the provisions for independent mediation or arbitration to resolve disputes, and the venue (whether this would take place in the United States or elsewhere); and
- the contract completion date.
- the service to be provided and the people who will provide it;
- the facilities, information and personnel that the client will make available for your use;
- the date on which your provision of the service is to begin and end;
- the payments to be made, together with the milestones for these payments;
- what will be done if your buyer is unable to provide the facilities, information or personnel that are stipulated in the contract;
- conditions for holdbacks; and
- the circumstances under which the contract may be terminated, together with stipulations for partial payments, penalties, and other requirements related to the termination.

The fundamental provision of the contract is that you the seller will transfer ownership of the goods to the buyer in return for payment. A clearly written, precise contract will greatly reduce the chances of disagreement between you and your customer. The rest of the contract details the terms and conditions for doing this. At minimum, the contract should include the following:

In addition to the general provisions described in the previous section on goods contracts, your contract for exporting services should specify:

It is also crucial to be absolutely clear about whose laws will govern the interpretation and enforcement of the contract: Will they be Oman’s laws or the laws of the United States?

If the contract involves the licensing of proprietary, information or technology, it is important that the wording be very precise about the licensee’s rights. Vagueness can create serious problems and could lead to the loss of your intellectual property. Also—and this would seem obvious, but it is sometimes overlooked—be sure that all parties to the contract have signed it. For instance, if you are working through a representative, be sure that the actual buyer signs the contract. The representative’s signature is not necessarily enough, because without the buyer’s signature there is no written evidence that the buyer owes you money. Last, but certainly not least, have the contract examined by a lawyer familiar with the US export market.

Know U.S. Business Laws and Customs Rules. Exporting to the US means that you’ll have to become familiar with a new set of business laws. While there’s no substitute for good legal counsel, you’ll make better decisions if you have a basic knowledge of things like the Oman-US FTA rules, US tax laws, and Omani customs and export regulations.The United States applies taxes to both businesses and individuals. It has two different levels of tax jurisdiction: the first is at the federal level under the US Internal Revenue Service (IRS), and the second is at the state level. Taxes can be based on income, or on the sale or use of a good or service (for example, state sales taxes). The US tax system, like most tax systems, is complicated, so you will need legal and accounting professionals to help you avoid unexpected tax liabilities. Failure to pay or collect the correct taxes may incur penalties above the actual tax amount owed. Information on US tax regulations and policies can be found on the following sites: Internal Revenue Service (IRS): www.irs.gov. Taxsites.com (federal, state and local taxes): www.taxsites.com. For more information about the rules, refer to Frequently Asked Questions #3: What are the Documentary Requirements For Me to Export to the United States?, #6: What Product Packaging and Labeling Requirements Must I Take Into Account?, #7: What are the Technical and Quality Standards I Must Take Into Account?, #14: How Do I Identity My Product’s Customs Duties and Fees?

8. Choose Your Partners With Care

“No matter how you find potential intermediaries, it is essential to check them out before choosing one…” — Canada Export Guide

While you may be certain that the direct-exporting route is best for your company, don’t be too quick to jump on a plane and start knocking on doors. Think first about using an intermediary, because the right one can save you an enormous amount of time and money.

The use of intermediaries gives you the distinct advantage that you get an immediate presence in the US market without setting up your own sales operation. However, this also means greater separation from your customer base and less control over the marketing of your product. Ultimately, you will have to decide whether using intermediaries is right for you. The most common intermediaries are distributors, trading houses and representatives (also called agents, manufacturers’ agents or manufacturers’ representatives). For more information about the different types of intermediaries, refer to the Frequently Asked Question #10: What Distribution Channels (Mode of Entry) are available for Exporting to the United States?

You can obtain information about potential intermediaries from trade associations, local chambers of commerce (both American and Omani), business councils, banks and contacts at trade fairs. Talking with other exporters or potential foreign customers can also help you identify prospective agents or distributors.

Once you’ve developed a list of candidates, you should visit the market to meet them. Talk to several firms and then carry out your due diligence to make certain they’re reputable. You can protect yourself by entering into a limited term trial agreement. If the foreign intermediary does not meet your expectations, you can find an alternative once the trial period is over. Be sure to tailor it to your company’s particular needs and the characteristics of your chosen market. To evaluate a prospective intermediary in detail, use the checklist below (or just provide link).

No matter whether you use a distributor, trading house or manufacturer’s representative, the usual principles of good business relationships apply. In the case of a representative, you’ll get the best service if you also pay attention to:

providing suitable product literature, case studies, application information and promotion;
giving speedy attention to the representative’s questions and requests;
supplying accurate information about company policies, competitive factors and product development; and
paying commissions promptly and at competitive levels for your industry.

Online sources of information about US intermediaries are also available. For manufacturers’ representatives, a good place to begin is with the Directory of Manufacturers’ Sales Agents (MANA) at www.manaonline.org; it’s a subscription-based service that allows you to search its listings by state, territory or sector. Unfortunately, there is no central database of US distributors, but an online search combining “distributors” and some keywords describing your sector will usually give you a list of possibilities.

For more information about intermediaries, refer to the section on frequently asked questions, number 10: What distribution channels are available for exporting to the US? and number 13: What logistics support services are available to me for exporting to the US and how do I use them?

Online sources of information about US intermediaries are also available. For manufacturers’ representatives, a good place to begin is with the Directory of Manufacturers’ Sales Agents (MANA) at www.manaonline.gov; it’s a subscription-based service that allows you to search its listings by state, territory or sector. Unfortunately, there is no central database of US distributors, but an online search combining “distributors” and some keywords describing your sector will usually give you a list of possibilities.

9. Protect Yourself

“An ounce of prevention is worth a pound, or a Dollar or a Dinar, of cure” — Variation on an Old Saying

Because it takes place across borders and at a distance, even the simplest international trade arrangement can be more complex than a business arrangement wholly confined to a single domestic market. Most international trade arrangements will involve multiple parties, multiple transactions, and take place across borders and at a distance. These characteristics increase the potential property, contract, and partnership risks. Additionally, collections and other contract disputes can be expensive and time consuming to resolve using litigation, arbitration, or other dispute resolution mechanisms. Therefore, every Omani business person considering international trade should take reasonable precautions against such risks to ensure that his or her property and interests are protected. The effort to take precautions that prevent a problem is well worth the savings in time and effort that it may take to solve a problem once it occurs Several specific best practices apply as reflected below.

Contracts. Contracts should be carefully drawn and based on a lawyer’s advice, and preferably a lawyer with experience in commercial agreements involving international trade. Payment provisions, reporting requirements, non-disclosure clauses, representations, certifications, warranties, and default and penalty clause should be included and carefully drafted to protect contract risk. Base any quotation of final price on payment terms, and adjust your price accordingly if the terms (e.g., fees, commission, currency exchange, etc.) change.

In selecting counterparts, you have the right in negotiations to ask for and see certified copies of business licenses, registration, taxpayer registration, credit reports, and other documents that evidence the bona fides of your counterpart and the basis for any representations the other party may make. You should consider asking for banking references and the relevant banking history of your counterpart, as well as references from other trade creditors, such as other foreign or domestic suppliers. There are external sources that you can use to do your due diligence (e.g., US “Better Business Bureaus,” consumer protection agencies, Secretaries of State in each US state for corporate registrations, and Moody’s or Standard and Poor reports for public companies).

Intellectual Property. Patents, trademarks, and copyrights are valuable intellectual property. Companies can take steps to protect intellectual property in their market and in the US market. The government-to-government relationship between Oman and the US, a company can seek assistance from US government agencies to enforce US domestic law against intellectual property theft if it occurs. You should consider the following steps:

Register all intellectual property; including your inventions, industrial designs, marks and copyrights
Include protection clauses in all contracts and agreements based on and tied to the rules of the US intellectual property rights regime and the FTA
For trade secret information (e.g., technical or operational information that is unknown to the public, economically beneficial to the owner, and reasonably protected by the owner), mark all confidential items, restrict access to trade secrets, and implement confidentiality policies and other agreements with employees
Include strong non-compete, confidentiality and non-disclosure provisions for trade secrets in your contracts with agents, distributors, and other partners
Make intellectual property protection a core responsibility of your distributors, agents, and other US partners
As noted above, before selecting a partner, conduct due diligence on suppliers and distributors, researching their networks and identify any weak points where counterfeiting could occur
Select partners with brand images and reputations of their own to protect
Conduct periodic audits of the controls for intellectual property protection maintained as part of your trading relationships
On your own, or through you business association, advocate aggressively in support of intellectual property protection
Become aware of the issues by staying current with US trends (e.g., US government resources include: the US Department of Commerce, the US Foreign Commercial Service, the US Patent and Trademark Office, the Copyright Office and US International Trade Commission)

Financing Arrangements. The burden of the administrative steps and the cost of bank procedures necessary to establish more secure trade financing devices, such as letters of credit, might tempt an exporter to use more informal processes. These heighten the risk of loss in the case of non-performance by a counterpart. Using appropriate trade financing devices that tie payment to performance can minimize the risk of loss. An exporter that cannot use the services of a large and reputable bank, should ensure that the financial institution chosen to provide financing for the transaction has a solid reputation.

Insurance. There are a variety of insurance devices that cover import/export transactions at each step in the process. Commercial credit insurance covers accounts receivable. Insurance while also cover the risk of loss or damage to your goods while they are in transit. Investigate and identify the types of available insurance, compare policy prices, and make the appropriate strategic decision for covering your transactional risks.

10. Do Not Underestimate The Power Of Technology

Web technology has revolutionized the way we do business. It brings a wealth of benefits to sales and marketing that can really make a difference in how you get your product to market. Technology is a powerful tool that can affect your product’s image, your customer relationships, your ability to penetrate more markets and can open a whole new world of information that can inform your market research. In fact, making sure that your company has the necessary technology and connectivity is a crucial ingredient in doing business with the US market.

Branding and Marketing: Web technology is an affordable way to reach prospective clients easily. It helps to level the playing field for new or small producers by reducing the cost of distributing information and helping to extend marketing reach. You can potentially attract larger numbers of prospective customers for less cost than with many of the traditional methods of outreach.Websites have become essential to marketing strategies. You can be creative with the presentation of your product and feature details, change or update information easily, and incorporate features that provide customers with added benefits, such as the ability to submit questions or make customer service requests online. This requires a commitment of resources to ensure prompt and reliable responses from your end but can be worth it if it helps to provide an effective way to engage with customers.In addition to websites, email can be used to regularly update and share information with customers by creating a group lists and sending e-newsletters or periodic broadcasts to the members of the list.
Customer Service and Relations: Web technology makes it easier for customers and buyers to do business with you. This is partly due to the fact that it can help exporters manage customer relationships and makes communicating and interacting with buyers and consumers possible and easy – even from great distances and across time zones Foreign companies can use this benefit to provide US customers with the level of customer service they demand and are accustomed to receiving. The internet and/or software can also help you to manage customer data efficiently.
Internet Sales: E-commerce trends in the US have been on a steady increase over the past 10 years with internet sales averaging 3.4% of total retail sales in 2008 compared with an average 1% of sales in 2000. According to one 2008 study, within a 6 month period, nearly 80% of US adults purchased a product online. With security concern sufficiently managed, online shopping is here to stay and will likely continue to growing in popularity.
Web Presence: The US has one of the highest rates of broadband penetration and usage rates in the world. In March 2005, roughly half of all American homes were equipped with broadband technology. By May 2008, broadband technologies had spread to more than 90% of all residential Internet connections in the United States. If your target market is in the US, these statistics suggest that web technology will be an effective tool in your sales strategy. PricewaterhouseCoopers reported that US$16.9 billion was spent on Internet marketing in the US in 2006. Web presence is an important tool in order to enter into the market and compete with domestic providers.
Market and Consumer Research: There is a wealth of information online. Exporters have access to a great deal of useful information, statistics, and trends from websites, search engines, and online databases. Some are free and some require registration and user fees. Part of the appeal of e-commerce is the ability of the customer to comparison shop. Even if the consumer decides to purchase the item from a store rather than the internet, it is a tremendous convenience to search for products online, compare prices, features and benefits before making a final decision.