How SMEs can embrace Australia’s Free Trade Agreement with Japan

How SMEs can embrace Australia’s Free Trade Agreement with Japan

The Free Trade Agreement (FTA) with Japan is, as everybody is hailing, a very good thing for Australia, including Australian shoppers and business owners.

The advent of cheaper Toyotas, Nissans, Hondas and Lexii follows the much cheaper Jeeps and Chryslers that have entered our market as a result of the FTA struck with the USA several years ago. I personally would like to see cheaper Kawasakis and Yamahas too. 

These things, whilst appearing to be abstract big picture political stuff, really do drive change at the store and dealer level. These changes help Australian retailers to compete better with overseas pure-online players, as the actual landed cost of goods into Australia drops. A slight movement in currency and hey presto! there is no longer a price difference between an Australian online product and a European one. This is all good stuff for Australia, as the tax man gets his GST too.

But what about at the SME level? How can SMEs harness this geopolitical change?

Well, I’ve written many times about the power of travel. Including the benefits of visiting overseas trade shows to connect with product and brand owners who wish to sell into Australia, or retailers and wholesalers who are looking to differentiate themselves with new and interesting products or services and want to buy from here.

On average I receive 30 emails each month from American, Asian and European exporters wanting to sell into Australia. Some I follow up, as their offering is different or unique, while others I reply with a polite ‘no’. What matters is that the vast majority – around 99% of these unsolicited emails – come from SMEs who own small factories or import/export businesses in Austin in Texas, Marseille in France, or Kluang in Malaysia.  

The email address is from the export manager or the managing director, who I always assume is an owner. The companies have either made the investment to employ somebody to research export markets and jump on airplanes to visit trade shows and prospective new customers all over the world, or the owner is doing it themselves.

And it’s not just commerce that is looking to assist trade. Governments actually do want to help. To illustrate, after my recent blog about entering southern China via Hong Kong and Macau, two trade attachés from Asia contacted me via LinkedIn.

So here’s my point. At a cocktail party to link British, international and local business people in Africa, I was once told a story by a British Embassy Trade attaché. And it goes like this:

“In the early 1950s, when Britain was trying to rebuild its industry, two English export managers working for shoe factories arrived by boat in a small African nation.

After two days walking around the main city they each send a telex back to their factories reporting on the potential for export sales of shoes.

The first sends: “Beautiful country. STOP. NO opportunity here. STOP. Nobody wears shoes.”

 The second sends “Beautiful country. STOP. MASSIVE opportunity here. STOP. Nobody wears shoes!”

 Which export mentality do you have?

 

Kevin Moore is a retail expert and the chairman of Crossmark Asia Pacific Holdings.

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