International Partners Entering the USA

International Partners Entering the USA

 

Market Entry Challenges for International Partners

International manufacturers and partners seeking to enter the United States market face a highly competitive environment. Multiple global conglomerates, as well as independent manufacturers, compete vigorously for project specifications and market share. Success in the U.S. is often determined by a company’s ability to overcome unique obstacles not typically encountered in other international markets.

 

Understanding the U.S. Customer Chain

One of the primary challenges for international manufacturers is understanding the complex structure of targeted customers in the United States. The chain of command in a typical U.S. project begins with the Owner and flows through the General Contractor, Electrical Contractor, Distributor, and influencers such as Architects, Engineers, Lighting Designers, and Manufacturer Representatives. Without a clear comprehension of this hierarchy, international companies may struggle to effectively position their products and services.

 

The Role of Manufacturer Representatives

Manufacturer Representatives play a critical role in the success of U.S. projects. They serve as the essential link that maintains satisfaction across the entire chain of command. Selecting the right rep agency is crucial; it can significantly influence the level of success achieved within a given region. For further details, refer to the associated Rep link.

 

Establishing the Right Product Value and Pricing

Determining the appropriate value and pricing structure for products is vital for winning contracts in the U.S. market. Several factors must be considered to ensure competitiveness:

  • The U.S. lighting market has hundreds of manufacturers, making competitive pricing essential.
  • Product features that are common and valued internationally may not hold the same significance for U.S. customers; some attributes may have little to no value in this market.
  • It is important to assess how your product line competes in value within the context of the Manufacturer Representative in the region.
  • Your pricing must align with the market required delivery schedules.
  • All participants in the customer chain must be serviced (pre & post) competitively to maintain engagement and satisfaction.

International manufacturer face head winds from duty, freight and time of deliveries but some who have excess capacity could benefit the most in US market provided they can sell at their contribution margins. This concept is typically used by large Global Conglomerate companies to establish themselves in new geographical areas. This concept can be a competitive edge for manufacturers to rapidly enter the US market. Smaller companies frequently overlook this effective approach for launching products in the USA.

 

Delivery to Market

In the United States, most orders are fulfilled within 2 to 4 weeks, while larger projects may require 4 to 6 weeks; in select cases, delivery times may extend to 8 weeks. Market delivery offers flexibility, allowing customers to select from thousands of available options. Manufacturing or assembling products domestically provides a competitive advantage. Typically, freight is prepaid, and the manufacturer assumes liability for orders exceeding $5,000.

 

UL Standards

All fixtures in the United States must comply with UL standards to prevent delays or back charges resulting from inspector rejections. At BLG, our in-house testing laboratory enables us to bring luminaires to market within weeks, offering faster turnaround compared to direct submission to UL facilities which could be months. See the ETL link for further information.