In 1966, economic historian Geoffrey Blainey first coined the term ‘tyranny of distance’ to describe the difficulty of trading internationally, especially for remote nations such as Australia. Recently Australia’s Leader of the Opposition, Anthony Albanese, paraphrased Blainey, asking us to reject the tyranny of distance and instead embrace the privilege of proximity. How things have changed in less than 60 years. The world has become a much smaller place and a virtual proximity now exists thanks to developments in information technology, transportation, and above all, communication. Our grandparents must marvel at what is now possible, with video conferencing and Zoom calls connecting us in seconds, anywhere across the world. Businesses that don’t embrace, explore, and exploit global connections and international sales are in danger of being left behind.
When considering international customers, corporations like Amazon, Alibaba, Google and eBay use the global marketplace to their advantage. Goods can be shipped to the four corners of the world in days (or sometimes, the next day!) and a bricks-and-mortar physical presence is no longer needed to have a shopfront in every country of the world – your online presence can now take care of that. Market researcher Insider Intelligence forecasts that the value of ecommerce retail sales in 2022 will be $USD 5.5 trillion and represent over 20% of all retail sales globally. So instead of fishing for business in the local pond, perhaps it’s time to cast a line into the lake of global trade and expand your customer base beyond existing horizons.
And what about dealing with international suppliers? Unless you are part of a service industry, you probably buy products to retail or raw materials to manufacture. Although there are benefits to buying local, the fact is, the high cost of local labour often makes whatever you buy onshore more expensive than a similar product sourced globally. Even with transport costs and import taxes, advantage can be gained from tapping into the global supply chain to reduce costs. As trade barriers are lowered, free-trade agreements signed and trading blocs established, exploring the global marketplace is easier than ever before.
However, selling and buying in an unfamiliar trading climate is not without risk. A network of international contacts to call on is an essential tool and can help your business to find its feet in an unfamiliar place.
A local contact can be especially useful in helping you to navigate the potential minefield of local culture and business etiquette. Without sound advice from someone who knows, it is easy to inadvertently cause offence and fall at the first hurdle. A local network partner can provide essential support for your business dealings in unknown territory.
A global connection can also provide advice on trade rules, regulations, and compliance. Trading standards differ from country to country, and in some cases, even from region to region within countries. A knowledgeable and supportive local partner can advise on how best to overcome the inevitable bureaucratic obstacles you are likely to encounter. Their business intelligence can also keep you appraised of products, developments, and trends in regional markets, keeping you ahead of the curve.
Advice and a friendly connection may be just what you need to get started, but the time may come when something more substantial is required. This might include a dedicated local buying team, a distribution network, or even a full-blown partnership. Your informal global network is the starting point for this bold move and imperative for supporting you to find the best fit for your business.
Another reason to explore your global network may be nothing to do with business or profit but simply about personal growth. Expanding horizons, embracing other cultures, while learning how things work across the world, can take you in surprising directions, with contacts and connections you would not imagine in your ‘local’ network. It’s also personally rewarding if you can support others with your knowledge and strengths in business. Authentically inspiring and motivating your connections around the globe can break down prejudices and foster understanding of a more empathetic world-view, as well as be the start of lifelong friendships.
So when you’re ready to start considering the advantages of increasing global connections, Scalepreneurs can help. We have a wealth of knowledge and experience, with a large membership of global business owners and international connections ready to support you.