If you want to be in America...

Feb 12 2008 by Sue Scott, Evening Gazette

THEY still insist on pounds and ounces and they’ve never learned how to spell “colour”, but if you strike a business deal with an American, you’ve pretty much got a contract for life - which is a comforting thought as the Federal Bank wrestles with imminent recession.

Loyalty is as central to corporate relationships in the States as barbecues are to family life - but if you’re crossing the Atlantic for the first time, don’t be surprised if the pay-off isn’t as generous as the supersize servings you’ll be invited to share with the wife and kids.

Experienced trans-Atlantic traders know to shave roughly 10% off their standard tender if they are even to get a foot in the door.

John Padbury, marketing director for Stockton-based Darchem Engineering, a long-standing exporter of aerospace products to the States, says: “The US is incredibly price sensitive, but if you are within 10% of the lowest bid then they will look at all the soft issues. If you are doing a selection matrix you can be higher, so long as you can give value for money and the life benefits are going to be good.”

Even once they’ve landed the deal, though, local firms tend to make all the running, which can be costly when the majority of States-bound flights now leave from Heathrow.

“Only 5% of Americans have a passport,” says Emily Humphrys, commercial manager for Cambridge Research Biochemicals in Billingham.

“It’s quite rare to get an American to visit. Most of our customers won’t travel out of the US.”

Lesley Moody from nearby AES, a specialist builder of database and multi-lingual web sites, which recently rolled out a $100,000 web-based management system in the States and has quoted for $450,000 more, agrees.

“Although in our case, there’s more of a necessity for us to be there and we go out regularly. But we have to be careful when we are putting together costings that we’re covering all the elements. We’re a digital media company and we use webcasts to a certain degree, but in the initial stages of exporting it was really important to get across to visit.”

There’s no getting around it, says the UKTi’s US specalist advisor in the North-east, Simon Crosby.

“For companies targeting the US, the three golden rules are visit, visit, and visit. You can’t do it from a distance. The Americans like to press the flesh.”

They can also be disarmingly straightforward.

“They get down to business very quickly but they are genuinely honest and trustworthy - you don’t hear of many companies getting their fingers burned in the US,” he says.

State-side exports are worth a staggering £1bn a year to the region - 10% of its entire foreign order book - making it the number one destination for goods and services shipped off shore. Chemicals, engineering, pharmaceuticals, aerospace and energy lead the running from Teesside, and despite Uncle Sam’s current economic embarassment, he’s likely to remain their biggest customer for some time to come.

While Crosby’s boss, the UKTi’s international director for the North-east David Coppock, says firms would be advised to insulate themselves from a cool Atlantic draft by looking east as well as west over the next few months, most Teesside exporters to the States appear to be escaping a downturn - at least, so far.

“Even now, they have a certain amount of protection because they are selling on value added or quality,” says Crosby. “It’s quality rather than price if you are going to start in the US.”

Americans tend to live up to their image: brash, personally generous and highly litigious. Their historically risk-averse culture has spawned practically a sub-continent in paper pushers who can seriously dampen an exporter’s enthusiasm and lay man-traps for the unwary, which is where the UKTi’s North-east office frequently steps in to help.

“They are very strict over paperwork,” says Crosby. “It’s essential that the products and supporting documentation and compliance are in order. That’s where we help - with the strategic stuff.”

With an on-the-ground presence in nine cities and friends in high places, it can also open doors that would otherwise remain as inpenetrable as Alcatraz.

Lesley Moody of AES says even being able to use the British embassy for trade receptions is a key turner.

“And when you say you’re getting help [to export] from the UK government, it impresses them.”

America is not one country, but several, says Crosbie, and for that reason you’re never on safe territory, especially around sensitive issues, such as religion and politics.

“Some of the work we do is in the mid-West, which is incredibly religious ... it was interesting when the Da Vinci Code came out,” says Moody.

“America is a continent in itself, like Europe,” adds Crosbie. “What works on the east coast doesn’t work on the west - regional tastes are paramount.”

And businesses back home have to adjust their service accordingly, he says.

“You are doomed to failure if you think you can work at arm’s length. It’s not just about getting the website right for an American audience, it’s about getting the back office right, even making sure there’s someone on the phone to take a call at 4am.

“Service is very important to the Americans - if you do not get the customer service right, you are doomed to failure.”