In This Chapter
It is important to visit overseas markets—before any transaction occurs. As discussed in Chapter 3, many foreign markets differ greatly from the domestic market, and by visiting another country you can familiarize yourself with cultural nuances that may affect the design, packaging, or advertising of your product. Traveling abroad can generate new customers. As in the United States, clients and customers overseas often prefer to conduct business in person before concluding a transaction.
A successful business trip typically requires substantial planning (see Box 16.1). This chapter focuses on the many steps you need to take before traveling abroad and offers recommendations that will make the trip more successful.
All overseas travelers are required to have proper documentation before leaving the United States. You must have a current U.S. passport, visas from certain host countries, and—in some instances—vaccination records. If you’re bringing a product for demonstration or sample purposes, an ATA carnet may also be helpful. Businesses should allow six to eight weeks to acquire all the necessary documents.
The ATA carnet is a standardized international customs document used to obtain duty-free temporary admission of certain goods. The abbreviation ATA is derived from the French words admission temporaire and the English words temporary admission. Countries that are signatories to the ATA Convention require the carnet. Under the ATA Convention, commercial and professional travelers may temporarily take commercial samples; tools of the trade; advertising material; and cinematographic, audiovisual, medical, scientific, or other professional equipment into member countries without paying customs duties and taxes or posting a bond at the border of each country to be visited.
You should contact the U.S. Council for International Business to determine if the country you are visiting is a member of the ATA Convention. Carnets are generally valid for 12 months. To receive an application or to ask questions, contact the U.S. Council for International Business, 1212 Avenue of the Americas, New York, NY 10036; call (866) 786-5625; or visit http://www.uscib.org.
All travel outside the United States and its possessions requires a valid U.S. passport. Information is available from the nearest local passport office. A wealth of information is available online from the U.S. Department of State about U.S. passports, applications, and renewals. You can obtain a nationwide listing of government offices that have passport applications, or you can download a printable application from the State Department at http://www.state.gov.
Many countries require visas, but they cannot be obtained through the Passport Services Directorate. Visas are provided by a foreign country’s embassy or consulate in the United States for a small fee. You must have a current U.S. passport to obtain a visa, and in many cases, a recent photo is required. You should allow several weeks to obtain visas, especially if you are traveling to developing nations. Some foreign countries require visas for business travel but not for tourist travel. When you request visas from a consulate or an embassy, you should notify the authorities that you will be conducting business. You should check visa requirements each time you travel to a country because regulations change periodically. Contact an Export Assistance Center to learn about documentation requirements for the countries where you will be traveling.
Requirements for vaccinations differ by country. Although there may not be any restrictions on direct travel to and from the United States, there may be restrictions if you travel indirectly and stop over in another country before reaching your final destination. Vaccinations against typhus, typhoid, and other diseases are advisable even though they are not required. The Centers for Disease Control and Prevention (CDC) maintains a Web page to advise travelers of current conditions by country and region at http://wwwn.cdc.gov/travel/default.aspx.
Because foreign customs regulations vary by country, you are advised to learn in advance the regulations that apply to each country that you will be visiting. If allowances for cigarettes, liquor, currency, and certain other items are not taken into account, those items can be impounded at national borders.
Travel agents can arrange transportation and hotel reservations quickly and efficiently. They can also help plan the itinerary, obtain the best travel rates, explain which countries require visas, advise on hotel rates and locations, and provide other valuable services. Because hotels, airlines, and other carriers pay travel agents’ fees, this assistance and expertise may be free.
A well-planned itinerary enables you to make the best use of your time abroad. Although it is expensive to travel and your time is valuable, an overloaded schedule can be counterproductive. Two or three definite appointments, confirmed well in advance and spaced comfortably throughout a day, are more productive and enjoyable than a crowded agenda that forces you to rush from one meeting to the next before business is really concluded. If possible, you should plan an extra day to rest to deal with jet lag before starting your scheduled business appointments. As you plan your trip, you should keep the following travel tips in mind:
When planning a trip, you can discuss your needs and the services available at particular embassies with the staff of your local Export Assistance Center. You may also find it useful to read the appropriate Country Commercial Guide provided by the Department of Commerce.
Commercial and economic officers in U.S. embassies and consulates abroad assist U.S. exporters by providing in-depth briefings and arranging introductions to appropriate firms, individuals, or foreign government officials. Your local Export Assistance Center can help you access these services, or you can contact embassy and consulate personnel directly. Arrangements should be made as far ahead as possible. You may also find it useful to read the appropriate Country Commercial Guide provided by the Department of Commerce.
Also, a description of your firm and the extent of your international experience would be helpful to U.S. government officials abroad. Addresses of U.S. embassies and consulates throughout the world are available on the U.S. State Department Web site at http://www.state.gov.
Businesspeople who hope to profit from their travel should learn about the history, culture, and customs of the countries they wish to visit. Flexibility and cultural adaptation should be the guiding principles for traveling abroad on business (see Box 16.2). Business manners and methods, religious customs, dietary practices, humor, and acceptable dress vary from country to country. You can prepare for your overseas visits by reading travel guides, which are located in the travel sections of most libraries and bookstores.
Some of the cultural differences that U.S. firms most often face involve business styles, attitudes toward business relationships and punctuality, negotiating styles, gift-giving customs, greetings, significance of gestures, meanings of colors and numbers, and customs regarding titles.
The cultural anthropology literature has given us many insights into how other countries do business and how to avoid cultural blunders. One example is that Thais consider it a serious offense for someone to touch them on the head. Useful to know? Maybe. But it’s hard to imagine in the United States or anywhere else businesspeople meeting for the first time or even after several times and engaging in head touching or hair messing. So by all means read the literature and talk with people who know the culture. But don’t be intimidated and don’t be reluctant to meet people. And do keep these general rules in mind.
Understanding and heeding cultural differences are critical to success in international business. Lack of familiarity with the business practices, social customs, and etiquette of a country can weaken your company’s position in the market, prevent you from accomplishing your objectives, and ultimately lead to the failure of your exporting effort.
Americans must pay close attention to different styles of doing business and the degree of importance placed on developing business relationships. In some countries, businesspeople have a very direct style, while in others they are more subtle and value personal relationships more than most U.S. businesspeople do. For example, in the Middle East, engaging in small talk before engaging in business is standard practice.
Attitudes toward punctuality vary greatly from one culture to another, and misunderstanding those attitudes may cause confusion. Romanians, Japanese, and Germans are very punctual, whereas people in many of the Latin countries have a more relaxed attitude toward time. The Japanese consider it rude to be late for a business meeting but acceptable—even fashionable—to be late for a social occasion. In Guatemala, though, one might arrive from 10 minutes early to 45 minutes late for a luncheon appointment.
When cultural lines are being crossed, something as simple as a greeting can be misunderstood. Traditional greetings include shaking hands, hugging, kissing, and placing the hands in praying position. The “wrong” greeting can lead to an awkward encounter.
People around the world use body movements and gestures to convey specific messages. Misunderstandings over gestures are common occurrences in intercultural communication and can lead to business complications and social embarrassment.
Proper use of names and titles is often a source of confusion in international business relations. In many countries (including Denmark, France, and the United Kingdom), it is appropriate to use titles until use of first names is suggested. First names are seldom used when doing business in Germany. Visiting businesspeople should use the surname preceded by the title. Titles such as “Herr Direktor” are sometimes used to indicate prestige, status, and rank. Thais, however, address one another by first names and reserve last names for very formal occasions and written communications. In Belgium, it is important to address French-speaking business contacts as “Monsieur” or “Madame,” whereas Flemish-speaking contacts should be addressed as “Mr.” or “Mrs.” To confuse the two is a great insult.
Understanding the customs concerning gift giving is also important. In some cultures, gifts are expected, and failure to present them is considered an insult. In other countries, though, offering a gift is considered offensive. Business executives also need to know when to present a gift (on the initial visit or afterward, for instance); where to present the gift (in public or private, for example); what type of gift to present; what color it should be; and how many gifts to present.
Gift giving is an important part of doing business in Japan, where gifts are usually exchanged at the first meeting. In sharp contrast, gifts are rarely exchanged in Germany and are usually not appropriate. Gift giving is not a usual custom in Belgium or the United Kingdom either, although in both countries, flowers are a suitable gift when you are invited to someone’s home.
Customs concerning the exchange of business cards also vary. Although this point may seem of minor importance, card giving is a key part of business protocol. In Japan, for example, the Western practice of accepting a business card and pocketing it immediately is considered rude. The proper approach is to carefully look at the card after accepting it, observe the title and organization, acknowledge with a nod that the information has been digested, and perhaps make a relevant comment or ask a polite question.
Negotiating is a complex process even between parties from the same nation. It is even more complicated in international transactions because of the potential misunderstandings that stem from cultural differences. It is essential to understand the importance of rank in the other country and to know who the decision-makers are. It is important to be familiar with the business style of the foreign company, to understand the nature of agreements there, and to know the significance of gestures and negotiating etiquette.
Through research or training, you can have a working knowledge of the business culture, management attitudes, business methods, and consumer habits before you travel abroad. That knowledge is very likely to have a positive effect on your overseas travel. Your local Export Assistance Center can provide what you need to make a strong first impression.
FACT: Gathering and generating the proper documentation or overseas business travel requires time and attention to detail.
INSIGHT: Allow six to eight weeks to acquire all the documents.
FACT: First impressions are important.
INSIGHT: Americans must pay attention to different styles of doing business. In some countries, businesspeople have a very direct style, while in others they are more subtle and place more value on personal relationships.