United States country brief

Getting your product into market

The United States’ size and regional differences means many companies find it easier and more effective to segment the market by region or sector. You should nearly always appoint regional agents or distributors.

A good agent can be an invaluable asset because distributors tend to focus their sales staff on existing major lines rather than introducing new products.

Fulfilment centres (specialist operations in warehousing and distribution) have become increasingly important in the supply-chain network. They allow more competitive margins by replacing traditional distributors with agents working in conjunction with lower cost fulfilment centres.

In general, United States tariffs for manufactured items and consumer goods are under 10 percent. There are punitive rates in the agricultural and textile sectors where strict tariff quotas are also applied, for example for beef, cheese, butter and milk powder.

It is extremely important to research packaging and labelling requirements early in the planning process. Under bio-terrorism rules there are further labelling and exporting requirements.

Laws and regulations vary from state to state.

Logistics

A number of air freight providers, including Air New Zealand and Qantas, offer air cargo services from Auckland to the United States through Los Angeles or San Francisco. Space is limited and careful planning is important.

Direct shipping services to the United States West Coast are offered by numerous operators, many of which have two sailings to the West Coast a week. Sailing time to Los Angeles is approximately 17-19 days.

Setting up an office

It is critical to establish a presence in the United States, across all sectors, to effectively grow and develop the market. An in-market presence brings the exporter face-to-face with end-users, helps with after sale service and support and gives companies detailed feedback on its products and services.

Opportunities

• United States consumers have a positive and strong image of New Zealand food and beverage products. There are opportunities for committed New Zealand companies with strong and differentiated niche or value-added products.
• New Zealand software companies should target niche markets such as health information technology, radio frequency identification and automation software. The United States software industry is extremely competitive and products need to be uniquely positioned. Pricing alone is not sufficient differentiation.
• Opportunities for marine companies lie in custom-built boats and in high-end, high-spec marine equipment and accessories.
• Opportunities exist in the government procurement area with the United States public sector spend (federal and state) averaging over US$400 billion a year.
• New Zealand pine has made some headway into the United States market. Opportunities exist for focused, value-added product, through do-it-yourself retailers, supply stores and professional contractors.

Challenges

• Competition is tough.

Cultural and business tips

• The United States has a visa waiver for New Zealand business visitors. This is valid for up to 90 days and visitors need to get this as an on-line travel authorisation before travelling to the United States.
• Don’t fall into the trap of thinking that business in the United States is similar to New Zealand. The size and complexity of the market, and American culture, impact on the way Americans conduct their everyday business.