Compiled by the analysts at Creditsafe, Best Practices for Safeguarding Your International Business outlines the do’s and don’ts for companies trying to expand into countries such as Cuba, China, India, Russia and many others that until recently have been closed to outside investments and partnerships.
“In the not too distant past, doing business in far off countries like Russia and China could be prohibitive and cumbersome. In today’s fast paced, Web driven world, international business relationships can be cemented with a simple click of your keyboard or a text exchange. Although the landscape has changed, the rules surrounding credit and the associated risk remain the same,” said Matthew Debbage, president of Creditsafe’s American and Asia-Pacific Operations.
Whether you’re doing business with a company across the street or across the ocean, the same basic premise holds true you have to know who you are working with. “It’s all about knowing your customer or KYC. This is especially true when you’re dealing with businesses headquartered in countries such as China and Russia which were a mystery to many until very recently,” continued Debbage.
- Diligence: Do your due diligence and know your customer. Before you enter into any business relationship or offer payment terms, know who you are dealing with.
- Culture: Remember conducting business internationally is very different from doing it in the US. Be aware of cultural differences and sensitivities.
- Laws & Regulations: Every country has its own set of rules for conducting business domestically and abroad. It is incredibly important to understand the terms and parame-ters of a country’s business landscape before going into it.
- Politics: A country’s political environment can have a huge influence on your ability to conduct business. Be sure to have a good grasp of the current political environment.
- Affiliates: Affiliates or related companies could put a damper on a company’s financials. It is important to determine the level of risk and/or debt associated with a company’s affiliates.
Creditsafe provides customers with instant access to high quality and reliable business intelligence. It gives business leaders the tools and insights to make quick, informed and insightful decisions. Having a wealth of business information available 24/7 not only helps business leaders assess risk, but also helps organizations become more agile competitors in the hypercompetitive global marketplace.
- China is the USA’s 2nd Largest Trading partner.
- China has 77 Million registered companies.
- US to China 2016Trade – $25.2B Export & $101B Import (Source https://www.census.gov/foreign-trade/balance/c5700.html)
- US to Russia 2016Trade – $1.4B Export & $2.7B Import (Source https://www.census.gov/foreign-trade/balance/c4621.html)
- Forbes has named 27 Russian companies, including those hit by Western sanctions, among the world’s largest and most powerful in its Global 2000 annual list.
Source: Creditsafe Press Release