The U.S. market is large, absorbent and dynamic. It offers foreign companies attractive and unique export opportunities, while providing a great business environment for success. This success can only be fully realized, however, if foreign companies, who are interested in entering the U.S. market and establishing their presence in the United States, choose the optimal and most effective method to accomplish this goal.
There are numerous articles and specialized, often theoretical tips on how to enter and establish a physical on a foreign market, including the U.S. market. The average entrepreneur, engaged in developing his or her business, does not however, have sufficient time to study voluminous amounts of literature on individual foreign markets. Such entrepreneur is rather looking to answer a simple question: what is the most effective way for my products to enter a specific foreign market.
Green Gate Consulting, which cooperates with Polish companies and supports them on the U.S. market, has observed and identified three practical methods/options for foreign companies to enter and establish their presence in the United States.
One option is to establish a physical presence on the U.S market – either through opening a production plant or a Polish company’s subsidiary in the United States. The second option is to identify an American trade partner who would serve as a direct distribution channel for facilitating sales on the U.S. market. We know from experience that this option is almost always a guarantee of a quick and measurable success. The third option is to initiate a marketing campaign on the U.S market to advertise Polish products before exporting them to the United States.
Opening a production plant in the United States is a capital intensive option and it requires high initial investments. One method to avoid high entry costs and, at the same time, ensure a physical presence of a Polish company on the U.S. market, is to officially register economic activity in the United States and to open an American subsidiary while selling directly to the U.S. market from locally based warehouses supplied directly from Poland. This might be an interesting idea for Polish producers who already conduct sales in other parts of the world, and who are looking for ways to enter the U.S. market.
Physical presence in the United States is not, of course, mandatory in order to successfully enter the U.S. market and to ensure sales on this market. The relatively easier option is to find a local trade partner and/or distributor who will engage in selling Polish products in the U.S.
Green Gate Consulting knows from experience that a well established local partner who understands the U.S. market might actually be the quickest way for a Polish exporter to succeed in the United States. Compensating such business partner would present a much lower cost in comparison to either opening a production plant or subsidiary of a Polish company in the United States.
Potential Polish exporters to the U.S. market could also initiate a marketing campaign in the United States to promote their products. Such a campaign would have to be, however, tailored to a specific niche market. Prior to starting such a campaign, Polish exporters are strongly encouraged to closely analyze the U.S. market in terms of competition. The American market is in general receptive to new products, but such products have to either differentiate themselves from the competition or fill out the niche market gap.
Neither of these options is considered better over the other, and utilizing the proper strategy to enter the U.S. market is dependent upon the specific, individual situation of a prospective exporter – the type of products offered, recognition of the products and the financial situation of a prospective exporter.
Green Gate Consulting encourages Polish exporters to take advantage of the potential that the American market presents. While the American economy is steadily recovering from the recession, demand grows and so does the need for higher quality goods. The now popular trend in the United States is the import of less expensive goods from Asia, mostly China and India, providing a lower quality of imported goods. The American customers start noticing it while searching for higher quality goods. This is the time to sell and export higher quality and reasonable priced products.
We encourage Polish companies to explore business opportunities presented by the American market and we offer our support in identifying such opportunities.