How to Behave When You're a Guest

You won't get the most out of your supersmart export strategy if you're not a savvy negotiator. We asked experts how to avoid the mistakes most common to small companies operating overseas

By Anne Field

RELATIONSHIPS

Yes, you've heard this one before: In most regions of the world, serious negotiations are based on trust, and establishing trust takes time. That means going out to dinner and drinks at least a few times before you can come close to talking turkey.

What to do: If you have the resources to spend months cultivating a personal rapport with an overseas company owner, by all means do so. Otherwise, look to local and state government agencies for help, as well as to small business development centers.

CONTRACTS

In many countries, a written business agreement simply lacks the same significance it has here in the U.S. "A contract is seen as more of an agreement to agree to go forward," says Catherine Lee, president of CDL & Associates, a Barrington (Ill.) firm specializing in international training and management development. Don't be surprised to return home only to receive a fax with completely unexpected changes.

What to do: Follow up like a fiend. E-mail or call your contacts frequently, so you can hold them to their word.

TRANSLATORS

Even though the lingua franca of business is English, you may still need a translator. "While the CEO may be speaking to you in English, the rest of the staff in the room is probably conversing in the local language," says David Brophy, associate professor of finance at the University of Michigan's Ross School of Business. It's worse if your counterpart isn't fluent in English, and your translator provides only a cursory summary or doesn't understand the intricacies of your business.

What to do: Hire a translator willing to make an extra effort, and who understands your business issues. One possibility is to hire an ex-pat business student studying in the U.S. If you're counting on making the relationship a long-term one, consider hiring an employee fluent in the local language.

THE LEGAL SYSTEM

In most cases, suing your overseas business partner won't do much good. Even if you win a court judgment in the U.S., you probably won't be able to enforce it. If you try to sue overseas, you're likely to meet with bias or a highly inefficient system—at best.

What to do: Include an airtight arbitration clause in your contract. The New York Convention of 1958, an international agreement ratified by 141 countries, allows for arbitration of disputes. As a result, courts in those countries will recognize the validity of an arbitration finding.

YOUR NEGOTIATING PARTNER

The majority of businesses outside the U.S. and Britain are family-owned. If you're dealing with a nonfamily member or a younger scion of the family, it's likely he or she doesn't actually have the authority to make a decision.

What to do: You can't do much about the individuals the company owners pick to negotiate on their behalf. But you can conduct as much research as possible beforehand, so you know who you're dealing with—and how far from power that person is.

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