Avaya Innovations magazine, Issue 2, 2013

Five Types of Business Communicators—and Their Issues

Everyone in the office has idiosyncrasies. Luckily, Unified Communications can help you deal.

 

It’s the Golden Age of Communication. That’s what the experts and their scholarly articles say. Basically, it means that we’re all talking a lot, via the bewildering number of ways available to us.

Fortunately, Unified Communications is simplifying the whole affair by integrating various communication methods and devices. UC lets you, say, retrieve your office voicemail messages via email or cell phone, and respond via text or video call.

Most importantly, UC solves the challenges brought on the diversity of communication styles in your workforce. Recognize anyone?

1. The Stalker
   In the five minutes it takes you to get from one meeting to the next, a Stalker will email, text and leave you a voice message about the same thing. Often breathless from anxiety and speed walking, Stalkers are starched and pressed in their appearance, with every hair in place. This type takes their work—and their own project schedules—very seriously, and doesn’t understand that they’re wasting your time. Stalkers claim they do what they do because they just want to make sure you get the message. But we all know the real reason has more to do with somebody’s inner control freak.UC puts stalkers on the same page, literally. When you can see all your messages—voicemail, email and text—in one place, it’s easy to delete or ignore the duplicates. Take that, Stalkers!

2. The Hermit
   You may not know the Hermits in your office, but you definitely have some. They’re working from home. Or in an empty conference room. Or storage closet. With the lights off. As creative types, Hermits have the idea that if they never talk to anyone, they’ll get a lot more done. It can be true, but then again, what are they doing? Does anyone know?Hermits dress for casual Friday every day of the week. Their mobile phone ringers are down so low they can’t hear them. They’re often “unavailable” on chat during business hours with no explanation. UC can be the perfect solution for these folks because when they do decide to check in, you know you’ll reach them wherever they happen to be. New awareness-enabled UC solutions (due out soon) assemble all the pieces of your last conversation with a Hermit, helping you quickly recall the details no matter how much time has passed.

3. The Golfer
   Like the Hermit, Golfers can hardly ever be found at the office. Unlike the Hermit, it’s because this type opts instead to do business in the great, manicured outdoors. Typically in sales, Golfers have been wearing those Bluetooth earpieces 24/7 since the very first one hit the market. They’re not talking to themselves—or to you, so pipe down already. They’re doing a deal on the green, talking, checking inventory, and texting outside counsel on contract negotiation details from their iPhone. Simultaneously.As Golfer’s lines are always busy, it’s difficult to get a hold of them. Thankfully, UC helps this type keep up with all of their messages by bringing everything together in one place.

4. The Globetrotter
   Globetrotters are always an It’s just hardly ever the same one. It’s tough to get them in a meeting, because you just never know which time zone they’ll be in for the hour in question. In fact, where do they live? And when do they sleep?You can spot Globetrotters by their dark-colored, no-wrinkle slacks and skirts, which they buy at specialized travel boutiques. They live by their smartphones, keeping plane schedules, car rentals, hotel confirmations, directions, restaurant recommendations, and international business etiquette tips organized in various apps. Life is fast-paced and complicated, you see, and their time is limited. But so is yours. So next time, why not video chat? Seeing facial expressions as the two of you converse delivers the nonverbal nuance that email doesn’t (and lets you see how nice their hotel room is). You’ll reach a decision or get buy-in faster than you ever expected.

5. The Numerologist
   All seven square inches of a Numerologist’s business card is full of contact options: office phone, mobile phone, satellite phone, office fax, voice mail, email, web site, LinkedIn profile and Twitter handle. Reaching out to a Numerologist can give even a Stalker pause. Where to begin?Deriving comfort from redundancy, Numerologists have every cell phone they’ve ever owned in a drawer. They dress in layers. They keep a couple of extra pairs of shoes under the desk. Just in case. Numerologists spend a lot of time checking all their various accounts for fear they may have missed a call or message. It’s a real fear, because they probably have. With UC, Numerologists can simplify their contact identity to a single name or number, so there’s no more confusion. No more worry. Ah, doesn’t that feel better?

 

See “The Five Types of Bad Communicators” in layout.

Financial Times, March 6, 2013

Guest column: In mobile banking, emerging markets show the way

By Sanjay Poonen

For the world’s unbanked, those without access to even the basic savings account, it is hard to save, impossible to build credit, and all too easy to succumb to predatory lending.

Without a bank account, one cannot buy things online, or make purchases that require a credit card. The unbanked consumer is effectively cut off from many affordable financial services, depending instead on check cashers, loan sharks and pawnbrokers.

Lack of access to financial services has long limited people’s personal options. It is well known that financial exclusion perpetuates poverty and slows down economies. And it is not a small problem.

According to the World Bank, half the people in the world fifteen years of age and older – about 2.5bn people – do not have bank accounts.

From a bank’s perspective, however, bringing basic financial services to the world’s unbanked is a huge market opportunity – and a philanthropic one, too. The opportunity isn’t new, of course. In recent years, however, mobile technologies have matured to the point that they provide a cost-effective delivery channel, which has put the opportunity within reach. In fact, a new mobile banking report from Juniper Research predicts that more than 1bn people will use their mobile devices for banking by the end of 2017.

Dutch Bangla-Bank Limited (DBBL) is among the pioneers in mobile banking for the unbanked. In early 2012, the Bangladesh-based bank launched a suite of mobile banking services targeting the unbanked and underbanked. In only ten months, it garnered more than 1m new customers. Since then, an average of 100,000 customers have been signing up for services each month, and these customers have deposited more than $7.75m using the mobile banking platform.

Mobile operators are experiencing similar success among the unbanked. Safaricom, part of the Vodafone group, launched M-PESA branchless banking services to Kenyans via cell phones in 2007. As of March 2012, the operator listed more than 14.6m active users. Several other operators, including Cellcom Malaysia (AirCash), Globe Telecom (G-Cash), Mobicom Africa (MobiKash), MTN Uganda (Mobile Money), Orange (Orange Money) and Smart (SMART Money), offer similar mobile banking services to the unbanked.

The services are especially popular in emerging markets such as Mexico, Peru, South Africa and India where bank branches are few and far between, roads are poor or non-existent and transportation options are slow and/or unreliable. Mobile technology bridges these gaps.

The rural poor in developing economies make up the majority of the world’s unbanked population, but they are not alone An official US report released in September last year found that 8.2 per cent of households in America are unbanked. That amounts to nearly 10m households, or 17m adults. An additional 20.4 per cent — or 24m households (51m adults) — are underbanked. Together these figures add up to more than a quarter of the US population.

The percentage of both the unbanked and the underbanked has increased slightly since the last survey in 2009. Americans are also using alternative financial services more, including payday loans, check cashing, money orders, pawn shops, and so on. Both increases are probably due to the economic recession and resulting high unemployment rates.

Given that the current recession is global, it stands to reason that the numbers from other developed nations are probably similar. In fact, the World Bank’s latest numbers show that 11 per cent of the unbanked live in high-income economies.

Since mobile financial services in emerging markets are successful, why not apply the same models in established markets and provide clear pathway into more formal banking?

Lack of access is obviously not the main issue in most of the developed world. In the US survey, respondents cited insufficient funds, and the fact that they don’t need or want an account. The issues are different, but the results are similar.

For example, consider prepaid debit cards and payroll cards. They are both relatively new products that are increasingly popular, especially among the unbanked and underbanked. Consumers must “load” prepaid debit cards with an amount of money before they use them at points of sale. Payroll cards are similar, but can receive payroll funds directly from employers.

Pioneering banks are offering these cards now, using a business model similar to the one that has worked in emerging markets: a simple account accepted by a wide range of merchants. More important, almost half of unbanked US households that have used a prepaid card say they are likely to open a bank account in the future. Again, they represent a pathway into the formal banking system.

Some prepaid cards are stymied by fees, and do not build a credit history like a secured credit card, both of which are drawbacks. They do, however, help create financial literacy and a familiarity with credit that can be a step in the right direction.

Another example is Standard Bank’s AccessAccount in South Africa. These “starter” accounts can be opened using a mobile phone at a local sales agent and have no minimum balance and a low fee structure. Mobile origination is not only far more accessible for customers; it is also 80 per cent cheaper.

Launched in March of 2012,the bank is currently opening up to 7,000 of these accounts every day using SMS (text messaging) technology. In a country where only 54 per cent of the population has an account at a formal financial institution (World Bank, 2011), Standard Bank has found a way to tap into a very big market.

Approaching the unbanked population requires a new game plan. For banks looking to expand their base of customers, existing deployments in developing countries offer many lessons. So do alternative financial services in developed markets. For example, check cashers are conveniently located and open during extended hours. They provide a range of services under one roof. Fees are high, but they are clearly posted and easy to understand.

As worldwide economies move away from cash and toward mobile payments, it is important to consider that those without bank accounts will get left even farther behind unless mobile services are available that meet their unique needs – in both developing and developed economies.

The numbers are large enough to create a real opportunity and mobile technology provides a cost-effective delivery channel, as evidenced by DBBL’s successful mobile banking deployment. There is still plenty of room for more. The emerging markets have created a successful model for the unbanked that developed economies could follow.

Sanjay Poonen is president of Technology and Innovation Products, SAP

See column on Financial Times website.

Byline article for industry magazine placement, attributed to Ron Hildebrandt, founder of Enkata

7 Steps to Coaching Success

Contact centers are constantly under the microscope. On the front line with customers, they’re tasked with providing the best possible service in the most efficient way. To do it, they often invest millions of dollars to route, manage, record and analyze calls. Yet, most spend relatively little on managing the foundation of good customer service: agent performance. Contact centers with the best customer service records have begun to pull ahead of the competition by taking an entirely different approach, investing in next-generation coaching tools to ensure that they get the most from their people.

 

“Performance Coaching” is a structured, best-practice method that can transform contact centers. It helps companies shorten agent on-boarding time, reduce agent turnover, improve first call resolution, reduce average handle time and improve quality scores—often within the first six months.

From Traditional Coaching to Performance Coaching

Performance Coaching is a paradigm shift from traditional coaching. It’s a systematic approach that concentrates supervisors’ time on the agents, metrics and behaviors with the most improvement potential. Performance coaching differs from traditional coaching in focus, consistency, topics addressed, success metrics and time investment, as described in the table below.

The 7 Steps

Moving from traditional coaching to a Performance Coaching model takes planning and time. The following seven practices are critical to making Performance Coaching take root during the transition period and succeed for the long term.

1. Define the yardstick for coaching success.
2. Personalize the coaching process.
3. Focus on the right “vital few” metrics.
4. Coach the right agents.
5. Provide specific feedback to change behavior.
6. Coach your coaches.
7. Continually raise the bar.

1. Define the yardstick for coaching success.
A Performance Coaching program is about results. By measuring and rewarding agent performance and supervisors’ coaching results, companies can establish a foundation for the right Performance Coaching culture. Measure success at the site, team and supervisor level to ensure full visibility. For example, highlight your most effective supervisors by tracking the percentage of under-performing agents (below a target) by supervisor, as well as the percent of agents who achieve key performance indicator (KPI) goals. Give accolades to your best-performing coaches. Give assistance to those who struggle.

2. Personalize the coaching process.
Coaching is not a one-size-fits-all process. Coaching frequency, content, workflow and forms are often very different between sites, groups and coaching type. Personalizing the coaching process to reflect these differences ensures supervisor buy-in, and also that each and every session is relevant and productive. However, don’t overdo it. Too much variation between agents increases the complexity of the process and can create an inconsistent coaching culture.

3. Focus on the right “vital few” metrics.
Narrow your coaching focus to a list of three to five metrics, and you’ll set clear priorities for agents and concentrate coaching time in the most critical areas. Suggested criteria for your vital few KPIs:

• Linked to key company initiatives
• Part of agent incentives
• Achieve balance between efficiency and effectiveness
• Highly varied among agents
• Easy to understand

A good place to start is with average handle time, quality monitoring (QM) scores, customer satisfaction (CSAT) and first contact resolution (FCR). These best-practice metrics balance each other, and they’re the critical drivers of call center performance.

4. Coach the right agents.
Supervisor coaching time is a precious commodity. Invest it where it yields the highest payback: in the agents with the most improvement potential. Performance Coaching dedicates 60-80 percent of time on the middle performers, the 30-40 percent of agents clustered around the average.

To avoid over-coaching the worst performers, create a coaching strategy that outlines the percent of coaching time by agent segment. For example, a best-practice plan might call for spending 20 percent of monthly coaching time on the best performers, 20 on the worst performers, and 60 on those in the middle.

5. Provide Specific Feedback to Change Behavior
Performance metrics are only actionable if supervisors present them along with specific suggestions on how to change the behavior that causes them. For example, agent “desktop management” behaviors, such as poor typing skills or not using keyboard shortcuts, are often a major reason behind long handle times.

Supervisors can identify behavior-change suggestions by conducting side-by-side observations and reviewing QM results. New technologies (vendor offerings differ here) can also help uncover costly habits by linking directly to desktop analytics systems and call recording systems.

Once identified, it’s best to focus on just one well-documented and researched suggested behavior change during each coaching session.

6. Coach your coaches.
Great coaches are made, not born, as the old adage goes. Supervisors need training to establish and improve solid coaching skills. Help them feel confident that they know to provide not only specific and timely feedback in a constructive manner, but also that they match their response to each situation.

Consider certifying your supervisors in a course before deploying your performance coaching program. Then, regularly assess skills with “ride-alongs,” where a leader evaluates each supervisor at prioritizing which agents to coach, selecting the focus metric, matching their coaching model to the agent situation and providing relevant, behavior-based feedback.

7. Continually raise the bar.
Contact centers are dynamic places, with new agents, products, marketing campaigns and initiatives to keep up with every month. To ensure your organization can improve its performance in these ever-changing conditions, establish a coaching competency team to assess overall coaching effectiveness, maintain best practices and address business changes in coaching and training. Include representatives from every site and give the team the charter to help the organization achieve coaching mastery. A coaching competency center can become the place to meet, share ideas and evolve the coaching process as the business changes.

Performance Coaching Technology

While launching a Performance Coaching program primarily requires new processes and approaches to management, don’t underestimate the technology piece. It’s critical. A Performance Coaching initiative needs infrastructure that supports best practices, workflows, activity tracking and accountability. The technology must ensure that everyone in the organization is playing from the same playbook and measured against the same set of objectives.

Additionally, by automating reporting and administrative tasks, coaching technology creates more time for supervisors to spend with agents. For example, it can cut the time required to prepare performance reviews in half by providing employee targets, percent attainment and coaching notes at the click of a mouse.

For Best Results: Back to Basics

Agent coaching is the foundation for improved contact center performance. It’s by far the most effective management tool that a call center operation has to impact the business. However, the traditional, informal coaching processes that most centers use lack the focus and structure to achieve optimal results.

Performance Coaching is a new approach that requires transformation from the top down. It’s a leap forward from traditional coaching in its ability to help supervisors and agents become top performers. To be successful, supervisors must coach the right agents, using the right metrics and the right process. Performance Coaching drives results by focusing on changing agent behavior.

In the process, Performance Coaching will improve your KPIs, customer satisfaction and agent retention in a sustainable way. Although not a panacea, Performance Coaching is becoming a cornerstone of leading-edge service operations worldwide.

Magazine article for CalBizCentral, a publication of the California Chamber of Commerce

Can’t Be Too Careful: Importers and Liability

Over half of the goods for sale in United States markets come from abroad. In 2007, imports into the U.S. were valued at more than $2 trillion.¹

However, due to a few high-profile cases of unsafe products that came into the country from China during the last couple of years (toys with lead paint, contaminated pet food, and toothpaste containing the solvent diethylene glycol or DEG), concerns have grown about consumer safety when it comes to imported goods and the liability of importers.

Every importer has the responsibility to learn about the laws and liabilities it faces when bringing foreign goods into the United States. If there is a recall, the importer is liable. If someone finds contaminants in an imported product, the importer is liable. Companies that actively import goods always need to stay on top of suppliers, the safety of their products, and changing regulations. For those considering entering the import business, there is a lot to learn, but there are many resources for California businesses to leverage.

John Leitner, president of custom brokerage firm W.J. Byrnes & Company says, “Importing can be tricky, but if you spend the time to do your homework, you can avoid a lot of problems.”

Mr. Leitner purchased W.J. Byrnes & Co. in 1973, and has since written books about international trade, taught at Golden Gate University, and served on the President’s Export Council. He lectures widely about on how to get into the business of international trade and how to stay out of trouble.

It’s Up to Importers

“Informed compliance” is the official government term that describes importers’ responsibility to know the law and comply with it. Compliance includes using “reasonable care,” to ensure that:

• Your suppliers are legitimate
• Your products meet safety and other requirements
• Your shipment has proper documentation for the journey
• Your importation papers, including your commercial invoice, get filed at the port of entry upon arrival
• You have arranged for examination and release of your goods
• You pay any assessed duties

“Don’t wait for someone to come knocking on your door,” Leitner says. “Start making sure that you have all of the answers you need before anyone starts asking questions. The best place to start is the Customs and Border Protection web site.”

U.S. Customs and Border Protection
This government agency, also known as CBP, is part of the Department of Homeland Security. It’s responsible for communicating requirements to importers, and as such, the CBP web site, at www.customs.gov, is a great resource for new and established importers alike.

CBP also posts all of its Informed Compliance Publications here (in the Trade section), including information on recordkeeping, reasonable care, rules of origin, fines, seizures, penalties, etc., as well as papers on specific types of products.

The must-have CBP publication Importing Into the United States, A Guide for Commercial Importers is available as a free download on the site. “This is the basic primer for importing into the United States,” says Leitner. The document’s 211 pages explain the process of importing goods, as well as many industry terms, in detail.

If you have questions about specific issues that aren’t answered by the web site or guide, it’s best to contact your local CBP office for information.

Consumer Product Safety Commission
“The Consumer Products Safety Commission is another government agency to get to know,” says Leitner. “They cover a huge range of products, including apparel, power tools, and toys, among many others.”

The CPSC web site, at www.cpsc.gov, lists recalls and product safety news, as well as information about regulated products, safety standards, how to conduct a recall, and other topics for importers. You can even sign up for free email announcements.

U.S. Food and Drug Administration
“If you deal with food of any kind, the FDA is going to be involved,” says Leitner. “After 9/11, they realized that another way of causing great harm to this country would be with tainted food.” Consequently, all food importers must file prior notice of what they’re bringing in and who their manufacturers are. All the manufacturers must also register.

“The industry, including W.J. Byrnes, really supports a lot of these new regulations,” says Leitner. “Tuna is a good example of why. Every now and again, there would be a problem with contaminated tuna, so the FDA would put the kibosh on every kind of imported tuna. Because of the new registration requirements, they can quickly trace problems back to specific manufacturers. Oftentimes, the contamination comes from a single source, so they can pinpoint the problem, and not have to loop everyone else in on the ban. The system works much better now.”

The FDA regulates food and drugs primarily, but also medical devices, biologics, radiation-emitting products, cosmetics, and veterinary products. Check out the web site at www.fda.gov to understand regulations that may affect you.

DIY vs. Hiring a Professional
Leitner says, “Importing is similar to taxes and a court of law in this way: You can do almost anything and everything yourself, or you can hire an expert to help you. You can do your taxes yourself, or you can hire an accountant. You can represent yourself in court, or you can hire an attorney. If you don’t pay the right amount of tax, or get yourself unjustly convicted, too bad. You’re still liable. The government operates on the same premise for importing. You can do it yourself, or you can work with a professional customs broker.”

Because the process of clearing Customs is complex and requires a certain amount of specific knowledge, many importers hire the services of customs brokers, which are licensed by CBP. They act on behalf of importers in preparing and filing the required customs documents, and basically shepherding goods through the multi-layered import protocol. They can also represent you in customs matters, including payment of duties and release of your goods.

The National Customs Brokers and Forwarders Association web site, at www.ncbfaa.org, offers a searchable directory to help you locate one in your area.

Professional importing guidance can also come from other private-sector experts including attorneys who specialize in customs law and consultants. You don’t have to go it alone.

Reasonable Care

Reasonable care is a term the government uses a lot when referring to your responsibility in complying with laws. The legal definition is: the degree of care that a reasonably prudent person would use under like circumstances.

John Leitner says, “Nobody expects you to be a super sleuth, but if you’re just going to throw a dart at a map to find a supplier, or randomly pick one off the Internet, then you’re not using reasonable care.”

At some point, you will be examined. CBP uses a policy of random selection, which adds to the security of the system, but also means that you have to be ready at all times. It’s like going through security at the airport, or getting audited. The difficulty of the process all depends on how fast you can come up with the right information.

Carl Watson is the president of M.J. Carlyle and Company, an L.A.-based manufacturer and wholesaler of belts, handbags, and wallets for specialty chain stores. He says, “ Every importer has had their shipments searched. It’s very frustrating. If you’re a regular who follows the rules, and have shipments coming in every week, they don’t pull you over very much. But when your number comes up, it can delay you anywhere for three days or two weeks—and they charge you for it!”

“I encourage my clients to bend over backwards to show that they’ve used reasonable care,” says Leitner. “You need to know your manufacturers and use quality control. If you can show them everything they need to see right away, they’ll look it over and be out of there in a jiffy. If you can’t, they can camp out for weeks. Keeping a paper trail of written documentation is imperative, and you need to keep it for five years. If you don’t, you’ll be subject to penalties.”

Proposition 65
California’s Proposition 65, The Safe Drinking Water and Toxic Enforcement Act of 1986, is of particular interest to California importers. This is the law that requires certain products to display the following advisory: “Warning: This product contains chemicals known to the State of California to cause cancer and birth defects or other reproductive harm.” The law also allows for people to sue if products contain more than the allowed amount of lead or other toxins, which are lower in California than in other states.

Katie Holle, who manages the sales and marketing for Unison Gifts, her family’s Los Angeles-based gift import company, thinks about proposition 65 almost every day. “Everyone heard about the toys imported from China recently that contained lead,” Holle says. “Because of Proposition 65 and the recent bad press, manufacturers, retailers, importers and exporters in the U.S. and China are more cautious and aware.”

Unison Gifts imports gifts manufactured in China, including figurines, jewelry, and hand-blown glass. As the Unison Gifts line expands, the company has to be vigilant about working with its manufacturers to ensure they know everything that goes into making their products, and that everything gets tested. Says Holle, “Whoever imports the product is liable. If there is lead in your product, for example, and you didn’t know about it, but someone found it, you’d be liable, even if it didn’t cause harm to anyone. A lot of our customers now require that we complete testing before they’ll carry our products, because they could get sued too.”

Unison Gifts has taken extra precautions to ensure reasonable care when it comes to safeguarding against toxicity. Holle says, “We ask our factories to test, we send our products to testing centers, and we also have little lead test kits of our own that we use to test at our office. You really can’t be too careful.”

Keeping Up on Regulations
To keep up on the latest news and regulations, Holle subscribes to trade magazines and regularly checks the web sites of industry associations. She says, “I consult the International Housewares Association, the Gift and Home Trade Association, NRF (National Retailers Federation), and the Toy Retailers Association. They provide information about importing, but also about the retail and gift businesses in general, such as how stores are doing across the country and around the world, consumer indicators, and buying trends.”

Choosing International Business Partners

Choosing reliable business partners is one of the most time-consuming aspects of importing, and choosing poorly could harm your business. In fact, it’s one of the top reasons new importing ventures fail. Be cautious. Do your homework. Ask for references from banks and other businesses.

Watson says, “We go to China and visit factories to find our suppliers. In the beginning, it’s hard because they don’t trust you and you don’t trust them. Sometimes they’ll tell you what you want to hear, but they end up doing something else. We’ve been through that, and we don’t do business with those factories any more. That’s the biggest reason why we go over there and meet them in person.”

“When you first start off,” agrees Holle, “you have to have a few failures. That’s part of the learning process. Success comes at a price.”

Disaster stories abound about importers finding a really good deal, only to find out after the fact that they paid a high price for junk. Holle cautions, ”Be careful of great deals! Sometimes you find one, and it’s legitimate, but you really do get what you pay for most of the time.”

Here’s one of those disaster stories. “I was at a meeting of the Maritime Exchange,” remembers John Leitner, “and saw photographs of a couple of shipping containers that had blown up at sea. The contents were declared as scrap plastic. Apparently, the importer had gone to a web site to search for scrap plastic, and picked the cheapest source. The stuff came out of Mexico, got put on a vessel in L.A., and was on its way to China when it blew up. The “scrap plastic” turned out to be ground up old gas cans, and they blew up near the Equator because the gas residue got so hot it combusted. The Internet is a great place to go shopping, but you have to be careful. You’re liable for what you import. If that’s the only place you know about your supplier, you’re taking a big risk.”

The Internet
Alibaba.com is getting a lot of attention in the international trade community these days. The web site promotes itself as “the world’s largest online B2B marketplace.” There’s no doubt: it is amazing. With just a few clicks, you can find suppliers for feed grade amino acids, solar water heaters, embroidery machines, kaftans, oranges, forklifts, and it seems anything else you can possibly imagine. Alibaba.com isn’t the only one either.

Leitner has his doubts about those sites. “I think the Internet is best for sharing information instantaneously. In that regard, it has facilitated international trade tremendously. But it has also added risk, because it’s so easy for someone to make a non-existent company look legitimate.”

Watson can attest to that. He says, “I’ve seen web sites that show a nice-looking factory that seems like it makes good-quality products, but when we went to visit, the buildings looked like they’d been bombed out, and the working conditions were very poor.”

Both Watson and Holle appreciate the ease with which they can communicate with suppliers thanks to the Internet, however. Holle says, “I remember my parents always having phone calls and faxes in the middle of the night. They had to ship samples back and forth. But now, we can approve samples or share sketches a lot faster by sending images via email or FTP (file transfer protocol).”

Trade Shows
Importers can attend trade shows abroad to meet suppliers and see their products first hand, but you have to be careful there too. It’s relatively easy to put together a nice booth for a trade show, and the quality of the booth doesn’t necessarily reflect the quality of the company’s facilities or their products.

One drawback of sourcing at trade shows is that your competitors can buy the very same products, and you might end up importing the same goods as everyone else. “When we visit our suppliers,” says Holle, “we take our ideas, and develop new designs with the factory. There’s risk there, too, because the factory can turn around and sell your idea to another customer. You learn from experience which companies you can trust, which will honor an exclusivity agreement. When you do find a good one, you can build a long-lasting relationship.”

Making the News?
John Leitner shares this good rule of thumb: “If you’re doing business in a part of the world that’s making the news, and it’s not because of the great weather or good deals for travelers, then it’s time to pay attention.”

Looking Ahead

Because of the rising cost of fuel, transportation costs have increased dramatically in the last couple of years. Complicating that is the falling value of the U.S. dollar compared to the European euro, Japanese yen, and Chinese yuan.

“Our costs have increased quite a bit with China,” says Watson. “Fuel costs are driving it, but labor costs are also rising. People are looking into Vietnam, Cambodia, and Bangladesh for manufacturing.

Holle has experienced the same thing. “The cost of shipping a container has definitely gone up,” she says, “and the price of trucking has doubled. All the shippers, UPS, FedEx, and DHL, keep raising their rates. In order to cover our costs, our products are becoming more expensive. It makes me wonder if products made in the U.S. will eventually be competitive again.”

1. U.S. Department of Commerce