KEY POINTS:
Bridget Liddell, chairperson of the Americas Beachhead Advisory Board, gives advice to NZ firms seeking access to the American market.
Does the US live up to its billing as the land of opportunity when it comes to New Zealand companies?
There are truly unlimited opportunities; we've got examples of New Zealand companies succeeding in the US in virtually every sector. New Zealanders are extremely sought-after for the qualities that we bring to market - we are innovative, flexible, are not deterred by size and we will give it a go. You can make a lot of money in the US if you get it right and the value proposition that New Zealand companies offer is often exactly what this market wants. It's a retail marketplace which, in many cases, offers few points of difference. Innovation is extremely important to revenue - for example, Walmart's entire same-store sales growth in any year is due to new products. There's a hunger here for new products; consumers are ready for novelty and an innovative point of difference, especially around a clean, green, natural theme. You need to be able to back up what you are saying based on the qualities of your company and your product. Icebreaker is a very good example of a New Zealand company doing just that.
Is New Zealand on the radar in the US?
The New Zealand brand is recognised for a number of qualities which are anchored in the tourist definition of clean, green, scenic, distant but attractive and friendly.
What are some of the pitfalls for New Zealand companies in the US?
The key is understanding the differences between New Zealand and the US, really committing to the market and not trying to take a New Zealand value proposition and sell it here. That means moving management and strategic thinking to the marketplace and really understanding how business is done here. I don't believe a serious commitment to the US market is possible from New Zealand. By having a physical presence in the market you will understand far more about the way business is done. There are cautionary tales about companies being successful in New Zealand and Australia who become too wedded to a particular way of doing things. Don't come here unless you are prepared to make a very substantial commitment of resources and capital; set your aspirations high and think in terms of multimillion-dollar sales numbers. I've seen examples of three companies in only their second year of business here who've totally eclipsed their New Zealand and Australian sales and are struggling to keep up.
What else must a company get right from the outset?
You need to build your company credibility quickly and get into a position where you can be searched by relevant agencies. Take tax, compliance, immigration and insurance requirements very seriously. Be very clear about how important this is. Don't belittle, downplay or think you can get around any of these things. Employ good advice.
What do the New Zealand companies doing well in this market have in common?
There are a large number of companies doing incredibly well in the US - Icebreaker, Bendon, Peace Software, Orion Healthcare, Tenon, Pumpkin Patch, Glidepath. These are great success stories and there are many more. What they have in common goes back to the points I made about serious commitment, devotion of resources, establishing a presence in the marketplace, being very flexible about aligning their product to local conditions, those sorts of things.
What role does the Beachhead play in all of this?
Beachhead advisers offer top-quality strategic advice and networks to entrant companies. The Beachhead initiative has two main economic drivers: speed to market (we can hopefully increase the speed with which a company can make sales and get to a point of break-even), and reduction of risk. By using networks and listening to the Beachhead advisers people can avoid many of the errors they might otherwise make.
The US demands that you are here with purpose and serious commitment. It's not a game; it costs a lot of money. And you need to think aspirationally.
Use New Zealand Trade and Enterprise (NZTE) and Beachhead networks and all your other networks. Take networking extremely seriously and listen to strategic advice.
Exploit the really terrific characteristics of the "New Zealand DNA" that will be an advantage to you here - that innovative, often very creative, approach to business, thinking out of the box.
Work out your key differentiating characteristics in the marketplace. Weaving in the New Zealand story can give you an advantage.
Focus very heavily on revenue and on making sales.
Be very receptive to lessons that other New Zealand companies and market entrants can teach you.
Be incredibly knowledgeable about your competitors and identify their strategic gaps and your opportunities.
There is lots of opportunity. If you approach the US the right way with the right support there is no reason why you can't do really well here. There are so many exciting opportunities for companies that are well prepared, disciplined and really focused.
* Bridget Liddell is based in Seattle, Washington, and is the principal of consulting firm Antipodean Equity.
