Only businesses with a flexible trading model and a strong understanding of the need to keep moving forward will be winners.
Five of the key changes affecting global trade are:
- The rise of the multi-channel sales experience
If you only sell direct from a physical outlet, how many customers are you failing to reach? Aligning channels to customer expectation is vital to capture as much trade as you can.
- The focus on sustainability both by consumers and companies.
It's a key theme and is a rising concern for many customers. Sourcing goods locally helps reduce the carbon footprint of your products. This can improve your status with customers and potentially drive increased sales.
- Geopolitical shifts and the changing shape of trade agreements around the world.
The rules and regulations that affect global trade are always changing. It's important to stay up to speed. How will the US stepping back from the Trans-Pacific Partnership impact its influence on Asia trade rules? You need to understand how it might affect your business now and in the future. With uncertainty surrounding the North American Free Trade Agreement you need to know what possible negotiations mean for your business.
- The rise of new trade corridors, notably Belt and Road.
The Belt and Road initiative – a plan to commercially connect China with the rest of Asia and Europe via land and sea infrastructure – is perhaps one of the greatest global trade opportunities of recent times for most sectors and industries. By 2050, this region aims to contribute 80 per cent of global GDP growth and move three billion more people into the consumer class.
- The demographic shift in China/Asia towards a younger, worldly-wise and brand-conscious consumer
It's growth time for Asia-Pacific countries with more working-aged people and fewer dependents than at any point in history. With the rise of the young middle class demographic comes a huge market for international-branded consumer goods and Western culture.
Five areas of practice you should be exploring to optimize your trade strategy are:
- Supply chain technology
You can optimize the way you manage all your process points between supplier and customer, using point solutions or a single platform. It's important also to investigate the potential uses of blockchain.
- Finance, treasury, procurement and the new internal and external relationships
Seeking a collaborative approach, perhaps aided by connected technologies, will help deliver a single, timely and accurate view of how your trade processes impact each other.
Look for better planning and costing around the loading/unloading and movement of your goods across all transportation modes.
- Warehouse/storage management
Are you optimizing space, labor, equipment, tasks and material flows?
- Finance solutions, including supplier finance, trade finance and electronic documentation
Do you know the most cost-effective ways of reaching your customers?
A helping hand
The key to success in the changing face of trade is to keep questioning how you can sustain your business's growth.
Ask yourself: “Is what I am doing now really working?” Look closely at what you do, how you do it as well as the internal and external structures that support your business. Then, consider what you need to do to make customer access to your goods or services easier. Remember: no access means no sale.
For international businesses, doing this in each market you operate in sounds intimidating. That's why it's important to partner with a bank who has a truly global footprint and on-the-ground presence to help you understand the nature and impact of these ongoing shifts in trade.
Routine review of your structure and approach to business can help ensure you're prepared for the scenarios described above. It's important to remember if businesses don't respond to the needs and requirements of their customers and vendors across the supply chain, others will.
For more information on how we can support your trade ambitions and help you navigate the changing face of global commerce – contact us via the links below.