USA EXPORT BLOG

USA Export to Turkey? Should a US manufacturer consider exporting its products to that part of the world?.

This country has come to the forefront of the news thanks to its politics and its geographical location. Turkey has been a republic based on the political systems of European countries for some time. Its population of 77 million has followed their creator Ataturk’s model of keeping church and state separate. The result is a bustling activity with a yearning to be better recognized in the West as a country with growing importance.

Istanbul is expanding on either side of the Bosphorus. With the largest part of the city on the European continent and the other on the Asian side, it has been leading Turkey to open up more and more to the West. Western business practices are attracting investments and Turkish policies and exporting efforts are taking the country to the rest of the world. According to the CIA’s World Factbook 30% of its employment is in agriculture. It’s largest trading partner is Germany from whom it imports almost as much as it exports. Turkey imports twice as much from Russia than from the US. And this presents a great opportunity for USA Export products to be sold into Turkey.

Although we see enormous growth in Dubai, Turkey is well positioned to between the Western and the Eastern business cultures. The commercial attitude of the Turks is well known and the growth of the American Business Forum in Turkey is proof that business leaders are committed towards stronger relations with the US and throughout the world. Those business people also understand the importance of that country in the world’s economy. Surrounding countries like Azerbaijan and Kazakhstan look toward a strong Turkey for business relationships and guidance. It’s GDP’s annual growth between 2002 and 2007 is 7% to reach $660 billion, making it the 17th largest economy in the world. And they are open to USA Export products.

The USA Export number for April was at a 35 month low. The Imports number for April dropped also, however, slightly. The reports from the Census Bureau show a larger deficit when combining both the imports and the exports. Oil is a big part of why it is now wider.  There are 2 reasons:

1) The US imported almost 3 million barrels more oil than in March.
2) The cost of oil went up from $41.36/barrel in March to 46.60/barrel in April.

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Unless you already have USA Export customers or have giant companies purchasing your products, your typical terms of payment will be Net 30 days or shorter.  Most companies operate with money borrowed from the bank in the form of loans or lines of credit.  Any day that a payment comes in after the 30 days, it costs real money and slices into the bottom line.  Once international customers are being approached, there are other issues to consider before pricing is even brought up:

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There is a lack of demand for our USA export products!

That was the headline of an article in the Dallas Morning News.  It is true that the trade deficit has been getting smaller since the peak in July 2008.  That is the result of the decreasing amount of exports and an even more decreasing amount of imports.  The global recession has placed a great pressure on sales everywhere.  However, according to the CIA world factbook, the US ranks No. 41 in the world for exports per capita.  We are right after Gabon at $4482!  Some European countries are exporting more than they produce for their own consumption.

It is a fact that US manufacturers have been very busy taking care of their own backyard.  And they have taken extremely good care of their backyard.  The US has the largest economy in the world.  Nevertheless, they have gained little experience looking outside of the US borders and especially outside of North America for USA export products.  It is the result of not having offered their products to foreign buyers in a concerted effort.  The world economy has been global for several years.  Do all US manufacturers understand that in order to survive, exporting is an absolute necessity? Continue Reading »

“A weak dollar makes USA export products more attractive to buyers in foreign countries, which helps U.S. companies sell more stuff.” comes from the article “What’s behind the dollar’s gyrations? – U.S. Money was strongest when economic crisis was worsening, the seesawing dollar from the Associated press published amongst others by the Dallas Morning News on June 2. In short, the reason for the dollar recent weakness (see http://www.xl-group.us/files/Currency_Exchange_Matrix_Table5.pdf ) is the increased amount of debt the United States has amassed in recent months.

The weakness of the Dollar helped the US getting out of the great depression of the 1930’s and so the similarity may be strong between both recessions. USA export products helped American companies grow and put more people to work.

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