Entering the International Market

A recent economic survey of the members of MAPPS found that U.S. firms view the international market as a bright spot in the demand for geospatial data products and services. However, entering the international market can be a difficult and time-consuming endeavor.  Here are a few tips most experienced exporting professionals say are essential to successfully performing surveying or mapping overseas.

Essential Tips

First, work as a subcontractor before venturing overseas on your own.  One of the lowest-risk ways to gain international experience is by working for a large firm—an engineer, constructor, or other trusted client that is experienced in exporting—in order to learn the ropes from a mentor. Second, working for a dependable client, such as a U.S. government agency, is preferable to working for a foreign government or private client, at least as you start. The U.S. Army Corps of Engineers, U.S. Agency for International Development (USAID), Millennium Challenge Corporation, and the State Department’s Overseas Buildings Office are among the federal agencies that contract for projects requiring surveying and mapping in foreign countries.  These agencies’ contracts, terms and conditions, and payment practices are more dependable and familiar to U.S. firms than those of overseas entities.

It is also advisable to have an agent in the country you’re working with.  Retaining a reliable consultant to assist with local and on-site logistics, processes, and relationships is more cost-effective and efficient than trying to do everything yourself from long distance in the United States. Due diligence should be taken in identifying the right agent.

Fourth, spend time learning our laws, as well as the host-country’s legal requirements.  Business in other countries is conducted differently than in the United States, so it is critical that you become well versed in local customs, practices, and laws.  In particular, learn the Foreign Corrupt Practices Act (15 U.S.C. §§ 78dd-1, et seq.), a U.S. law that governs American companies doing business in other countries.

The U.S. government has several export-assistance agencies that can help in the early stages of doing business in foreign countries as well as in providing continuing education and trade missions into all parts of the globe. Many progressive states also have international economic development assistance available. When researching doing business in a new country, firms have many questions that must get resolved to move forward. Several of these questions, such as business climate, stability of the local government, and company tax and registration requirements, can be answered quickly by contacting a U.S. Commerce Department’s International Trade Administration or the Small Business Administration’s Office of International Trade.

One firm that has successfully captured foreign projects is Merrick & Company of Aurora, Colorado.  Brian Raber, CMS, GISP, GLS, is president of Merrick Advanced Photogrammetry of the Americas, a subsidiary established for work in Central and South America. He said, “There are many external issues facing U.S. firms when attempting to compete for international projects. These include:

  • higher marketing and project
  • management costs;
  • unusual local and foreign participation/competition;
  • inadequate standards, scope
  • definition, and scope creep;
  • language misinterpretation,
  • legal considerations, customs
  • and currency issues; and
  • ethical and legal challenges.
“Firms must be committed to this endeavor, be very patient; require exceptional legal, human resource, accounting, foreign tax, risk management, export control, safety and ethical behavior processes; and have buy-in from everyone in the firm to succeed in the international market,” said Raber.

“Firms competing in the international marketplace must often deal with unusual and unpredictable procurement practices. The more interesting experience we learned about after losing a large opportunity was that the firm winning the project provided the aerial photography for ‘free.’ That is, the country where the winning firm was located subsidized this part of the contract so that thousands of labor hours can come back to its country. We have also seen ‘no interest loans and project financing’ offered by countries so their firm was highly ‘competitive’ and providing jobs ‘back home,’” Raber said. 
 

Federal Government Encouragement

As a way to help companies gain foreign work, MAPPS worked for several years to implement a U.S. private-sector utilization program in federal foreign assistance programs, such as USAID.  Historically, USAID has used the United States Geological Survey, the National Geodetic Survey of the National Ocean Service in the National Oceanic and Atmospheric Administration, and other federal agencies rather than private firms. In the 1996 Foreign Operations Appropriations Act, Congress required use of competitive procurement among private U.S. surveying and mapping firms for USAID’s requirements.  This provision was preceded by similar language in the Foreign Operations Appropriations committee report language in prior years.  Moreover, it was implemented as USAID policy in a general procurement notice in 1996.

By leveraging USAID and the U.S. foreign USAID program, the risk and expense to U.S. companies can be reduced and U.S. firms can compete on a more level playing field.  “This type of contract would create jobs, as well as help U.S. firms obtain international experience and lower their risk doing so,” said Merrick’s Raber. “The world can benefit greatly from U.S. technologies, intellectual property, thought leadership, and proven standards. It would also seem logical [because most other countries offering aid require this, that] if there is a project that is funded by the United States, the work should be performed by U.S. firms using predefined standards,” said Raber.

John Byrd is the government affairs manager for John M. Palatiello & Associates, a public affairs, association management, and consulting firm in Reston, VA. He has more than 10 years of public-policy experience. He is also the government affairs manager for MAPPS, the national association for private-sector geospatial firms.
 
 
 

» Back to our November 2012 Issue

Website design and hosting provided by 270net Technologies in Frederick, Maryland.