Market Assessments and Market Entry Support
The United States of America has traditionally been a trade powerhouse, providing a huge range of goods and services of every imaginable type to markets across the globe. Besides exports of vast quantities of bulk commodities such as coal, oil, grain, timber and ores, the United States has a reputation for providing manufactured goods of the highest quality and sophistication accompanied by complex service offerings. The US has a particular strength in various types of transportation systems and capital goods, including locomotives, aircraft, automobiles, maintenance machinery and the modern computing and control systems associated with these items.
Due to a number of dynamics – such as demographics and debt - economies across the West appear to have entered extended phases where growth is negative, static or marginal. In this type of environment many US firms are aggressively seeking to explore or enter markets in the areas of the world with stronger growth dynamics including Asia, Africa and the Middle East. These countries have common characteristics such as young rapidly growing populations and low rates of industrialization and urbanization. Many are rich in natural resources and have overcome decades of turmoil to establish increasingly stable and representative governing structures. Their human resources too are benefitting from stability with investments in education preparing them for development. These markets present significant opportunities as well as significant risks.
US exporters also face significant competitive challenges abroad. European firms provide high quality sophisticated goods paired with a range of national and supra-national export assistance programs including “soft” financing and technical assistance. Industrial powerhouse China, while providing a tremendous market for US exports, is rapidly evolving from import substitution to export promotion in competition with US firms. China provides industrial goods of moderate but increasing quality globally at low prices supported by extremely aggressive state assistance.
The US government has a range of tools to assist US companies with their efforts to explore and enter foreign markets successfully. The Department of Commerce provides a domestic and international network of resources supporting trade promotion activity and providing assistance to US exporters. Many Agency for International Development and Millennium Challenge Corporation investments support infrastructure and legal and policy reforms that generally improve the business environment for US firms in selected countries. The Overseas Private Investment Corporation provides products such as political risk insurance, financing and guarantees and support for private equity investments. The Export-Import Bank of the United States provides export credit financing. The US Trade & Development Agency provides grant financing for feasibility studies, technical assistance and pilot projects that support future exports. The new federal National Export Initiative established in 2010 seeks to enhance the coordination of these agencies and other federal resources and policies with the goal of doubling US exports in a five year period. The fact is that while the US remains the world’s largest economy, future growth for many American firms appears to require looking beyond our borders and out to a more competitive world.
Since inception Seneca has had a strong international component. Seneca teams have worked on a steady portfolio of projects restructuring and commercializing transport systems in Latin America, Europe and Central Asia. We have an intimate understanding of the challenges, risks and opportunities that face US companies seeking to enter foreign markets. Our work has included key roles on teams involved in capital projects of up to a billion dollars in value and working at the highest levels of large industrial and transportation enterprises. We have performed major projects financed by multilateral agencies such as the World Bank/International Finance Corporation, the European Bank for Reconstruction and Development, and the Japan International Cooperation Agency.
Seneca can be of particular assistance to US firms exploring international business generally or a specific market for the first time. Our area of expertise is transportation goods and systems and industries that are heavily dependent upon rail transportation. We can perform desk assessments of global markets in which we will assess a range of considerations including market structure, demand projections and potential, macroeconomic and legal conditions, cultural and linguistic barriers and the competitive situation. Seneca can assemble on short notice teams of senior level analysts to conduct on the ground assessments. This may include such activities as identifying and evaluating local partners and distributors and logistics arrangements ranging up to performing more complete due diligence activities such as evaluating discrete investments in operations or facilities.
Seneca has specific expertise working with the US Trade & Development Agency. We have performed full grant financed USTDA studies as well as a number of desk studies (due diligences) of grant applications submitted to USTDA by US firms and foreign governments. We have also served on Definitional Missions for USTDA, travelling to foreign countries to work with local officials to develop viable project concepts for federal grant financing. We can help US firms considering USTDA assistance develop viable concepts and efficiently prepare complete, compliant and competitive application packages.
For more information on how Seneca can specifically support your firm’s efforts to enter foreign markets and maximize use of federal resources while doing so, please contact us.