Small Businesses: Confronting Trade Barriers
Novice exporters can face a tough battle when it comes to international trade. Tariff barriers alone are intimidating enough to keep aspiring exporters from entering the trade process, even despite the incredible potential market growth.
What can small businesses do to get beyond the roadblocks in order to successfully initiate international trade?
Intellectual property is growing like never before and is likely to become the largest market in the world. If you want to trade successfully you’ll need to be aware of national and international laws and requirements regarding intellectual property. Losing your intellectual property is something you do not want to happen, so being proactive about it ensures that you won’t lose your brand name, patent, or technology. Often times businesses try to avoid markets where they fear their intellectual property might get compromised but this doesn’t necessarily mean the risk is avoided. If you have intellectual property worth stealing then “pirates” will try to steal it regardless of whether your company ever enter that market.
Even though this might scare potential traders off, remember that avoiding international trade doesn’t necessarily solve the problem but it does rule out increased competitiveness and increased market share…
A second trade barrier you might encounter involves regulatory and standards ranging from bureaucratic delays, infrastructure headaches and unethical business practices. It is likely that as your business enters a new market you’ll face cumbersome customs and market-entry procedures. Likewise, voluminous and complicated document requirements and delays serve as non-tariff barriers. For many companies the multitude of requirements to provide the same documentation to numerous agencies in one country significantly contributes to the costs of international trade.
These are just two of the various trade barriers small businesses may encounter on their road to international trade, and this is by no means an exhaustive list. So what can you do to overcome these barriers? In many cases preparing thoroughly goes a long way. If you plan for tariffs and delays chances are they won’t affect your budget in any way – meaning you don’t have any unexpected surprises when embarking on your international trade adventure.