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Business negotiation
  with Americans
Goals
Structuring the negotiation : different success keys to
negotiate with Americans

Preparing the negotiation: to understand better the culture
and the expectations of American buyers

Negotiation’s strategy :to adapt your marketing strategy
to increase your success

Understanding the entry barriers to the U.S. market




                                            © Consultation Contacts Monde 2007
Module 1: Structuring the negociation : different
success keys to negociate with Americans

   Entering Your Chosen U.S. Market

                        3 strategies:
                          Direct selling
                          Indirect selling (selling
                          through intermediaries)
                          Selling through strategic
                          alliances




                                          © Consultation Contacts Monde 2007
Diversification Methods
Direct selling     Direct sales
                   Agents
Indirect selling   Distributors
                   Brokers
                   Trading House
Partnerships       Co-Enterprise/Co-Marketing
                   Agreement with other manufacturers
                   Licensing
                   Technology Transfer



                                        © Consultation Contacts Monde 2007
1. Direct selling
Direct exportation from a distance
   Direct sales
   Representative (paid manager)


Establish a U.S. presence
   Opening a U.S. branch of your company
   Establishing a separate U.S. subsidiary, such as
   a corporation




                                     © Consultation Contacts Monde 2007
Direct selling
 Allow you to operate a          Business implication
 retail outlet in the heart of   Important financial
 your U.S. market                resources (high fixed cost)
 Protect your company’s          Risk exclusively assumed
 assets                          by the export department
 Be seen as more                 International expertise
 «American»                      Need more time before
 Autonomy in the                 getting sales
 administration
 Better knowledge of the
 market
 Permanent network
 All the benefits




                                            © Consultation Contacts Monde 2007
2. Indirect selling

 Trading houses
 Representative (agent)
 Importers
 Distributors
 Brokers
 Sociétés de gestion export
 Bureau d’achat



                              © Consultation Contacts Monde 2007
Indirect selling
 Getting an immediate     Less control
 presence in the United   Greater distance from
 State market without
 setting up your own      your customer base
 sales operation          Control on commercial
 Limited risk             politics: very low /
 Low implication          null
 (human and financial     Paying commissions:
 resources)               short term vision
                          Screen between the
                          market, the clients
                          and the exporter

                                  © Consultation Contacts Monde 2007
3. Selling through strategic alliances
Formal or informal

 Licensing
 Franchising
 Cross-licensing
 Co-marketing
 Co-production
 Joint venture


                             © Consultation Contacts Monde 2007
Cooperation / partnership
 Sharing risk, cost and           Business implication
 investment                       Partial control on
 Sharing resources, know-how,     commercial politics
 contacts                         Risk to loose the know-
 Sharing export activities        how
 (custom clearance)               Understanding difficulties
 Resolving problem related to     (culture, language)
 professional accreditation,      Time required to
 movement of personnel across     administrate the
 the border and U.S. tax and      partnership
 legal status                     Difficulty to select partners
 Combining the technical and
 financial strengths of the two
 business
 Better knowledge of market
 specificities
 Access to public invitation to
 tender
 Access to technology                     © Consultation Contacts Monde 2007
Expectations of your agent

 Exportable goods
 Export knowledge
 Fair agreement / partnership




                                © Consultation Contacts Monde 2007
Questions & answers on videos
     How frightening?
     How different?
     How do you get started?
     What is the role of partnership?
     Is the partnership a threat?
Module 2: Preparing the negotiation: to understand better
the culture and the expectations of American buyers

   Personnel control on the environment and
   responsibilities
   Positive and natural perception on
   changes
   Time = $$$
   Egalitarianism and equity
   Individualism and independence
   Smartness et initiative


                                           © Consultation Contacts Monde 2007
The culture of the American buyer
 Competition
 Vision oriented on the future
 Vision and action work-oriented
 Lack of formalities
 Honesty, open-minded, rightness    (Enron !)

 Practical and efficient nature
 Materialism



                              © Consultation Contacts Monde 2007
Reminder on negotiation
from : Executive Planet.com

  Make up their minds quickly and decisively.
  Information must be straightforward and to the
  point.
  Money is a key priority and an issue that will be
  used to win most arguments. Status, protocol,
  and national honour play a smaller role.
  American businesspeople are opportunistic and
  willing to take chances. Opportunism and risk
  taking often result in Americans going for the
  biggest possible slice of the business, 100% if
  possible.



                                       © Consultation Contacts Monde 2007
Reminder on negotiation
 Dislike periods of silence during negotiations and
 in conversations, in general. May continue to
 speak simply to avoid silence.
 Persistence is another characteristic you will
 frequently encounter in American
 businesspeople; there is a prevailing belief that
 there is always a solution. Moreover, they will
 explore all options when negotiations are at an
 impasse.
 When they agree to a deal, they rarely change
 their minds.
 Future oriented. Innovation often takes
 precedence over tradition.

                                      © Consultation Contacts Monde 2007
Reminder on negotiation
Thinking tends to be analytical, concepts are
abstracted quickly, and the "universal" rule is
preferred.
There are established rules for almost everything.
Experts are relied upon at all levels.
Lawyers everywhere ! The most litigious society
in the world.
Negotiating = problem-solving through "give and
take" based on respective strengths. Often
emphasize their financial strength and/or position
of power.



                                    © Consultation Contacts Monde 2007
Reminder on negotiation
 In negotiations, points are made by the
 accumulation of objective facts. This evidence is
 sometimes biased by faith in the ideologies of
 democracy, capitalism, and consumerism. The
 subjective feelings of the participants are not as
 much of a factor. Therefore, they will not spend
 much time seeking consensus.
 Try to extract an oral agreement at the first
 meeting. Sometimes bring final contracts to first
 meetings. In large firms, contracts under
 $10,000 can often be approved by one middle
 manager in a single meeting.
 Limited knowledge of other cultures. May assume
 that their way is the "correct" or only way.


                                     © Consultation Contacts Monde 2007
Strategy to diversify your marketing
strategy: 2 websites to keep in mind
 Manufacturers’ Agent National Association
 (MANA): 22 000 professional sellers, by line of
 business. Since 55 years. www.manaonline.org
 (Americans like to have a direct access to your
 products!)

 For public sector: www.dfait-maeci.gc.ca :
 SALE2USGOV




                                     © Consultation Contacts Monde 2007
Why working with an American
representative (MANA) ?
    Predictable Sales Costs That Go Up And Down With Sales
    Lower Sales Costs
    Increased Sales
    Immediate Access To The Market
    Free consulting services
    Cost of Training And Turnover In Sales Personnel Is
    Eliminated
    Highly Experienced, More Aggressive Sales Force
    Sales Forecasting Is Equal Or Superior To A Direct Sales
    Force
    Broader Sales Context For Your Product
    Provides Marketing Flexibility At Less Cost
    Creates A Systems Approach To Selling
    Every Call Is A Relationship Call For Your Company
    Multi-faceted, Multi-skilled Sales Team
    Better Market Intelligence
    Vested Partner In Manufacturer’s Success


                                          © Consultation Contacts Monde 2007
Selling to the public sector
 It takes 3 to 5 years to close a selling with
 the U.S. Army
 It takes 3 to 4 years to close a selling with
 a government department

 Examples of procedures:
   Federal Acquisition Regulation
   Central Contractor Registry
   Tax Identification Number
   Help of DFAIT representative


                                    © Consultation Contacts Monde 2007
Module 4: Entry barrier on the U.S. market
The legal and logistical side of exporting to the U.S.
   Labelling et packaging
   Insurrance
   Custom’s law
   Quotas
   Transport
   Payment methods
   Intellectual Property




                                        © Consultation Contacts Monde 2007
Patent: United States Patent and Trademark
Office
Trademark
Norms, certificates, probate
American Standards Institute
Food and Drug Administration (FDA)
Travel’s status (Entry’s fee & visas)


           Post 9/11 context


                                  © Consultation Contacts Monde 2007
To conclude…

     Sources of information
     www.international.gc.ca

            Advices
Thank you !


 Subscribe to the CCM
     newsletter:
www.contactsmonde.com




                 © Consultation Contacts Monde 2007

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Negotiate With Americans (2011)

  • 1. Business negotiation with Americans
  • 2. Goals Structuring the negotiation : different success keys to negotiate with Americans Preparing the negotiation: to understand better the culture and the expectations of American buyers Negotiation’s strategy :to adapt your marketing strategy to increase your success Understanding the entry barriers to the U.S. market © Consultation Contacts Monde 2007
  • 3.
  • 4. Module 1: Structuring the negociation : different success keys to negociate with Americans Entering Your Chosen U.S. Market 3 strategies: Direct selling Indirect selling (selling through intermediaries) Selling through strategic alliances © Consultation Contacts Monde 2007
  • 5. Diversification Methods Direct selling Direct sales Agents Indirect selling Distributors Brokers Trading House Partnerships Co-Enterprise/Co-Marketing Agreement with other manufacturers Licensing Technology Transfer © Consultation Contacts Monde 2007
  • 6. 1. Direct selling Direct exportation from a distance Direct sales Representative (paid manager) Establish a U.S. presence Opening a U.S. branch of your company Establishing a separate U.S. subsidiary, such as a corporation © Consultation Contacts Monde 2007
  • 7. Direct selling Allow you to operate a Business implication retail outlet in the heart of Important financial your U.S. market resources (high fixed cost) Protect your company’s Risk exclusively assumed assets by the export department Be seen as more International expertise «American» Need more time before Autonomy in the getting sales administration Better knowledge of the market Permanent network All the benefits © Consultation Contacts Monde 2007
  • 8. 2. Indirect selling Trading houses Representative (agent) Importers Distributors Brokers Sociétés de gestion export Bureau d’achat © Consultation Contacts Monde 2007
  • 9. Indirect selling Getting an immediate Less control presence in the United Greater distance from State market without setting up your own your customer base sales operation Control on commercial Limited risk politics: very low / Low implication null (human and financial Paying commissions: resources) short term vision Screen between the market, the clients and the exporter © Consultation Contacts Monde 2007
  • 10. 3. Selling through strategic alliances Formal or informal Licensing Franchising Cross-licensing Co-marketing Co-production Joint venture © Consultation Contacts Monde 2007
  • 11. Cooperation / partnership Sharing risk, cost and Business implication investment Partial control on Sharing resources, know-how, commercial politics contacts Risk to loose the know- Sharing export activities how (custom clearance) Understanding difficulties Resolving problem related to (culture, language) professional accreditation, Time required to movement of personnel across administrate the the border and U.S. tax and partnership legal status Difficulty to select partners Combining the technical and financial strengths of the two business Better knowledge of market specificities Access to public invitation to tender Access to technology © Consultation Contacts Monde 2007
  • 12. Expectations of your agent Exportable goods Export knowledge Fair agreement / partnership © Consultation Contacts Monde 2007
  • 13. Questions & answers on videos How frightening? How different? How do you get started? What is the role of partnership? Is the partnership a threat?
  • 14. Module 2: Preparing the negotiation: to understand better the culture and the expectations of American buyers Personnel control on the environment and responsibilities Positive and natural perception on changes Time = $$$ Egalitarianism and equity Individualism and independence Smartness et initiative © Consultation Contacts Monde 2007
  • 15. The culture of the American buyer Competition Vision oriented on the future Vision and action work-oriented Lack of formalities Honesty, open-minded, rightness (Enron !) Practical and efficient nature Materialism © Consultation Contacts Monde 2007
  • 16. Reminder on negotiation from : Executive Planet.com Make up their minds quickly and decisively. Information must be straightforward and to the point. Money is a key priority and an issue that will be used to win most arguments. Status, protocol, and national honour play a smaller role. American businesspeople are opportunistic and willing to take chances. Opportunism and risk taking often result in Americans going for the biggest possible slice of the business, 100% if possible. © Consultation Contacts Monde 2007
  • 17. Reminder on negotiation Dislike periods of silence during negotiations and in conversations, in general. May continue to speak simply to avoid silence. Persistence is another characteristic you will frequently encounter in American businesspeople; there is a prevailing belief that there is always a solution. Moreover, they will explore all options when negotiations are at an impasse. When they agree to a deal, they rarely change their minds. Future oriented. Innovation often takes precedence over tradition. © Consultation Contacts Monde 2007
  • 18. Reminder on negotiation Thinking tends to be analytical, concepts are abstracted quickly, and the "universal" rule is preferred. There are established rules for almost everything. Experts are relied upon at all levels. Lawyers everywhere ! The most litigious society in the world. Negotiating = problem-solving through "give and take" based on respective strengths. Often emphasize their financial strength and/or position of power. © Consultation Contacts Monde 2007
  • 19. Reminder on negotiation In negotiations, points are made by the accumulation of objective facts. This evidence is sometimes biased by faith in the ideologies of democracy, capitalism, and consumerism. The subjective feelings of the participants are not as much of a factor. Therefore, they will not spend much time seeking consensus. Try to extract an oral agreement at the first meeting. Sometimes bring final contracts to first meetings. In large firms, contracts under $10,000 can often be approved by one middle manager in a single meeting. Limited knowledge of other cultures. May assume that their way is the "correct" or only way. © Consultation Contacts Monde 2007
  • 20. Strategy to diversify your marketing strategy: 2 websites to keep in mind Manufacturers’ Agent National Association (MANA): 22 000 professional sellers, by line of business. Since 55 years. www.manaonline.org (Americans like to have a direct access to your products!) For public sector: www.dfait-maeci.gc.ca : SALE2USGOV © Consultation Contacts Monde 2007
  • 21. Why working with an American representative (MANA) ? Predictable Sales Costs That Go Up And Down With Sales Lower Sales Costs Increased Sales Immediate Access To The Market Free consulting services Cost of Training And Turnover In Sales Personnel Is Eliminated Highly Experienced, More Aggressive Sales Force Sales Forecasting Is Equal Or Superior To A Direct Sales Force Broader Sales Context For Your Product Provides Marketing Flexibility At Less Cost Creates A Systems Approach To Selling Every Call Is A Relationship Call For Your Company Multi-faceted, Multi-skilled Sales Team Better Market Intelligence Vested Partner In Manufacturer’s Success © Consultation Contacts Monde 2007
  • 22. Selling to the public sector It takes 3 to 5 years to close a selling with the U.S. Army It takes 3 to 4 years to close a selling with a government department Examples of procedures: Federal Acquisition Regulation Central Contractor Registry Tax Identification Number Help of DFAIT representative © Consultation Contacts Monde 2007
  • 23. Module 4: Entry barrier on the U.S. market The legal and logistical side of exporting to the U.S. Labelling et packaging Insurrance Custom’s law Quotas Transport Payment methods Intellectual Property © Consultation Contacts Monde 2007
  • 24. Patent: United States Patent and Trademark Office Trademark Norms, certificates, probate American Standards Institute Food and Drug Administration (FDA) Travel’s status (Entry’s fee & visas) Post 9/11 context © Consultation Contacts Monde 2007
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  • 26. To conclude… Sources of information www.international.gc.ca Advices
  • 27. Thank you ! Subscribe to the CCM newsletter: www.contactsmonde.com © Consultation Contacts Monde 2007