Did you know that five US states are in the top 20 on a list of the biggest economies by GDP in the world? The list compares and combines the results of international and US state economies, with the states of California (5th), Texas (10th), New York (17th), Florida (18th) and Illinois (20th) all remarkably coming ahead of the likes of the Netherlands, Turkey, Switzerland, Saudi Arabia and Sweden for sheer volume of GDP.
It might be a crude measure, but it does give you some sense and perspective on the size of the US economy and its state sub-economies.
Australia has had a long and fruitful relationship with the US as both a trading partner and a lucrative and receptive market for the goods and services of our businesses. That partnership continues to thrive. Trade officials are painting a very positive picture of the opportunities available to Australian businesses willing to take the risk and do the work of expanding into North American markets.
Recently, Austrade executives Stephanie Fahey and Nicola Watkinson sat down for a chat with the former federal Small Business Minister Bruce Billson about what it took for Australian businesses to crack the US market. In a series of video interviews for The Female Social Network, Fahey and Watkinson provided some valuable pointers about what Aussie business owners could do to improve their chances of expanding Stateside.
Here are some of tips they have gleaned from their time working closely with Australian businesses in the North American markets.
1. Look at the fundamentals
“Always look past the everyday noise to see what the dynamics of the economy are. This is a market which is really booming at the moment and it’s also still the market that has incredible depth for venture capital,” says Nicola Watkinson, who is the general manager of Austrade’s North American office.
Watkinson oversees Austrade’s operations across a network of offices covering New York, Boston, Chicago, Houston, San Francisco, Washington, as well as Toronto and Vancouver in Canada, so she has a good idea of what’s going on nationally as well as in key states. Her view is that Australian businesses shouldn’t let daily headlines and noise get in the way of seeing clear opportunity.
2. Think big
Austrade CEO Stephanie Fahey says the focus of so many Australian businesses is on our domestic market, which leads to businesses that aren’t built for scale.
“I would say to think big; don’t just think about your own domestic market, because the Australian market is by definition relatively small,” she says. “The first advice would be to think big; bigger than you would ever imagine.”
She says by thinking big right from the start, businesses can build up the culture and operational structures required to then scale into international markets like the US. It’s a little bit like buying a bigger size item of clothing for a child — they’ll grow into it eventually.
3. Build your network
Stephanie Fahey has seen many entrepreneurs go into overseas markets and she says the best ones know how to “network, network, network.”
“We encourage people to talk to each other before they go and to build those networks when they’re in market,” Fahey says. She says there are plenty of Australian business networks in the US, with many people keen to share their knowledge and insights.
4. Be passionate
This stands to reason whatever market you are going into, but Fahey says passionate entrepreneurs always appeal to American customers and investors. Australians already have a good reputation in US business circles and part of that is because they are pragmatic optimists with a can-do attitude.
While speaking about female entrepreneurs in the interview, the advice extends equally to men. “I think it’s women who feel passionate about their product and have that authenticity. It gives them drive and makes them unstoppable,” she says.
5. Search out grants and any other trade assistance
Australian businesses are often unaware of the range of assistance they can receive from bodies like Austrade in the form of such programs as the Export Market Development Grants. The EMDG encourages small- and medium-sized Australian businesses to develop export markets and reimburses up to 50% of eligible export promotion expenses above $5,000, provided that the total expenses are at least $15,000.
The US economy is growing and most observers say the fundamentals are strong. Now is a great time for ambitious Australian businesses to look across the Pacific and identify markets that might be receptive to what they do. Yes, there’s some work and risk involved, but the payoff could be huge for your business.