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Entering the Global Marketplace: Lessons Learned David Fuhrmann President.

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Presentation on theme: "Entering the Global Marketplace: Lessons Learned David Fuhrmann President."— Presentation transcript:

1 Entering the Global Marketplace: Lessons Learned David Fuhrmann President

2 A Snapshot of Foremost Farms USA Established:1995 Milk volume:4.8 billion pounds Member-owners:3,600 Revenues:$1.4 billion Employees:1,487 Ranking:No. 15 (Dairy Foods magazine) among top 100 processors

3 Procurement Area and Plants


5 Our Products Markets are grocery, foodservice, industrial and converters

6 How we got started in the export business: -Acquisition of business entity in 1984 -Have continued to grow and diversify the exports

7 Foremost Farms USA Exports Today: 40 million lbs./year – Whey Based Products 5 million lbs./year – Cheese

8 Export Destinations: - South East Asia (China, Japan, S. Korea) -Central & South America (Mexico, Puerto Rico, Columbia, etc.) -Europe -Others

9 Export Sales to: -Brokers -Distributors -Specialty company manufacturers -Multi-national corporations

10 Why We Export: -Supplier to multi-national companies -Grow our business -Profitable business

11 Requests from: -Multi-national corporations -Repeat users -USDEC inquiries -Website

12 Challenges: -Language. Shame on us: “We only know English”.Time zone differences

13 Challenges: -Cultural Differences. Negotiations are different in different cultures.Difficulty in understanding “tones” of e-mails.“Bribes” vs “the way business is done”

14 Challenges: -Negative perception of US whey products -History of “dumping inferior product”

15 Challenges: -Product Packaging. Long distances. Truck, rail & sea travel. Hot, humid conditions.Complaints on 50% of shipments

16 Challenges: -Dealing with rejected product:.Can result in major $$ impact.Can’t bring product back to U.S..Resell the product in that country

17 Challenges: -Competition from other countries. Exchange rates.“Product dumping”

18 Challenges: -Quality.“Expectations” are not the same as product “specifications”.The customer is always right

19 Challenges: Quality (cont.):.Testing methods may be different.Local regulations can vary.The rules change without notice

20 Challenges: -Quality (Cont.).International customers are concerned about the source and quality of the raw milk supply. Quality discussions are more difficult when using an intermediary

21 Challenges: -Documentation. Paperwork must be flawless.Papers must exactly match product.Codes on product must be totally legible

22 The process is tedious and time consuming with “no margin for errors”

23 Resources: -USDEC -USDA – Washington -Bank

24 Lessons Learned: -International customers have higher expectations -We have experienced some expensive lessons

25 Lessons Learned: -“Partnerships” are critical -New communication technologies have opened the world!

26 Lessons Learned: -International business has become more complex since September 11, 2001 -International business is not “lucrative”

27 Lessons Learned: -Exporting has made us much better

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