How to Sell Overseas

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Harkness teamed with a manufacturer in India Timothy Archibald

Farrell got a helping hand from Uncle Sam Kevin Miyazaki/Redux

Guiliano (right) and partner John Down found receptive customers in Japan Roger Hagadone

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Joe Guiliano, president of Christopher Norman Chocolates in New York, has a niche product in the hotly competitive market for high-end specialty chocolates. Guiliano knew his 15-employee, $1 million company needed to diversify its customer base. First he tried Europe but found he was locked out of selling there because of a blockade of American sweets. Then the Japanese caught wind of his hand-painted, hand-sculpted creations. "The Japanese love visually how our stuff is different from the European chocolates," says Guiliano. "We also have the cachet of 'Made in N.Y.'" Guiliano found a distributor with experience selling specialty chocolates and its own manufacturing facility near Tokyo. That distributor now makes the company's candies under a licensing agreement.

One of the best ways to get to new customers is through existing ones. The days when CEOs or their minions parachuted into a new place, built a factory, and considered themselves officially "global" are gone. Nowadays, most companies, even those not currently selling overseas, already have an international network. The smart thing is to start using it. One of the best routes is to follow your partners or your supply chain. You may already be a supplier to a large foreign-based company that has customers in its home country. Or you may be outsourcing part of your operations to a company overseas. Use these contacts to find new customers. "Small businesses can take that relationship with vendors or suppliers and have them introduce them to customers in that country," says Tim Hanley, vice-chairman and U.S. process and industrial products leader for Deloitte.

That worked for Michael Worhach, president and CEO of Sepaton, a 140-person software manufacturer based in Marlborough, Mass. His is one of the companies that has benefited from the Chinese government's urge to upgrade. Sepaton's technology allows companies to back up data using digital files rather than tapes. But it took more than government initiatives to get Michael Worhach, Sepaton's president and CEO, in the door. Worhach knew a systems integration expert who was also a Chinese national with extensive contacts in China's banking and financial world. In 2003 his contact introduced Sepaton's products to Agriculture Bank of China and China Construction Bank, two of China's largest, as well as to People's Insurance Company of China. They signed on as customers, and things picked up from there. Sepaton now has about 35 business clients in China, offices in Shanghai and London, and 40% of its $28 million in revenues originating overseas.

When Stephanie Harkness decided to go abroad, she tapped her local network for global partners. Her 100-person company in Soquel, Calif., Pacific Plastics & Engineering, which makes plastic and injection moldings for biotech and other life sciences companies, used nearby firms for legal advice and accounting. But they were either large national outfits, such as Nixon Peabody, or belonged to professional organizations with members who were global. When she started thinking about finding a manufacturing partner abroad, they pointed her to potential ones in Bangalore. Harkness, who is chairman and CEO of the company, then made about six trips to India and interviewed management at more than a dozen factories. "You can quickly assess whether they have the same philosophy as you and shared values and if they have the knowledge base you need," she says. She learned to pay attention to a variety of cues, such as how clean and organized the factory is, what kinds of computer systems it uses, and even how the employees are dressed. She eventually invested $100,000 in a joint venture.

When Mike Farrell, the president and CEO of Sentry Equipment in Oconomowoc, Wis., began to sell globally, he worked through referrals from his customers, including such big companies as Bechtel and Westinghouse, which have plants in Brazil, Spain, Japan, and Taiwan. Founded in 1924, Sentry manufactures equipment that monitors the purity of steam and water used in manufacturing processes.