Reaching Out to
Global Markets
It may be faster and easier to grow in existing markets, but
eventually everyone wants to find a new opportunity. Finding the
right partners is as important as finding the right market.
Growing Your Market
Most U.S.-based
companies have their
greatest customer base
in the NAFTA region or
traditional markets
78%
When it comes to growth,
the strongest results are
closest to home, but
Asia comes in second for
expected growth
66%
US, CANADA, MEXICO
US, CANADA, MEXICO
22% CENTRAL, SOUTH AMERICA
12% ASIA
21% EU
9%
21% ASIA
6% EU
13% AUSTRALIA/OCEANIA
4%
10% MIDDLE EAST/AFRICA
6%
CENTRAL, SOUTH AMERICA
MIDDLE EAST/AFRICA
3% AUSTRALIA/OCEANIA
NON-EU EUROPE
16% ALL OF THE ABOVE
0%
NON-EU EUROPE
Path of Least Resistance
31%
ENTER NEW
MARKETS
69%
Given a choice, most companies would
grow in developed markets rather than take
on the burdens of an emerging market
GROW
MATURE
MARKETS
Why?
What Risks?
Transportation resources
below expectations
24%
Difficulty finding qualified
logistics providers
24%
Telecom/Info services
below expectations
18%
Customs clearance is
complex and slow
15%
Trade finance and funds
flows are complicated
12%
Difficult to understand
export compliance
(1-5 scale)
Disruption of
flow of goods
3.3
Cybersecurity
data integrity
3.2
Financial
3.0
Regulatory/
compliance
9%
2.8
Security of product/
intellectual property
Infrastructure issues
were viewed as
impediments by
42% of companies
2.7
Disruptions in the flow of goods and data, and
the security of data were among the greatest
perceived risks in new/emerging markets
Coping With Challenges
Partners make a difference in global markets,
especially new markets or emerging markets
where infrastructure, culture, and other
challenges can be a barrier to success
Working at a distance
35%
29%
18%
We maintain inventories
outside the market and
ship into new markets
We keep limited regional
inventories and replenish
into new markets
It is difficult and confusing
trying to manage from a
distance
Most company strategies position product outside or near
the target market, in part, because it is difficult to manage
distribution operations from a distance
Working in the market
Local distributors are helpful
but visibility and control are
lacking
Local distributors are
helpful but visibility and
control are lacking
34%
We use logistics service
providers to manage
inventories and distribution
in new markets
16%
28% 21%
The network of local
distributors is effective
Banking on relationships
A strong trade/ logistics
partner with experience
in the market
Internal experience
and “institutional
knowledge”
44%
28%
Networking to find
solid providers in the
new market
Government programs
and in-country
resources
24%
4%
68% of companies tap strong local partners to keep things
flowing and provide visibility into new market operations
68%
Bottom
Line
With all of the
complexities
of expanding
into or entering
new markets,
does it pay?
Yes, the benefits
outweigh the
cost
No, the
benefits
aren’t worth
the cost
38% 47%
The jury
is still
out
15%
SUMMARY:
There are barriers and challenges to entering emerging markets, but there are
resources to help with these frustrations. The right logistics partners with the
right resources and expertise can help alleviate a majority of these pressures
and help companies expand their supply chain.
Source: Sept – Oct 2015 MHL Survey, Emerging Markets
UPS: FROM FIGURING IT OUT, TO GETTING IT DONE, WE’RE HERE TO HELP.
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