Sometimes it’s personal connections that send an organization in a new direction, as with the Princeton Chamber of Commerce’s decision to strengthen its international business connections. The intimations of what was to come came through two relationships. The first was with Larry Richards, the Princeton rep of an economic development group in Quebec, whose purpose was to get businesses from Canada to expand in Central Jersey and businesses here to expand to Canada. The second was through chamber board member, Anne O’Neill, who was a rep from the Alsace, France, Region for Economic Development.
“That allowed us to start thinking about how the Chamber could expand and leverage its international reputation,” says chamber president Peter Crowley.
Crowley points to European and Japanese companies located in the region. “We felt the Princeton brand name internationally carries a lot of weight; when you talk to people internationally and talk about the U.S., they are very familiar with New York, Philadelphia, and Washington, and Princeton is considered to be high value for both the economic opportunities and labor force that is here,” he says.
So the chamber reached out to Camille Sailer, president of the European American Chamber of Commerce, which has been seeking to expand the relationships between the United States and Europe. “A number of our members do business overseas and a number of members would like to do business overseas, and by creating this partnership we can help them advance their companies’ growth,” says Crowley. “We anticipate that the partnership will allow more companies to learn about Princeton and Mercer County when looking to locate their businesses here.”
The two chambers have joined together to present a three-part breakfast series, which will open Tuesday, August 12, 7:30 to 9:30 a.m., at the Nassau Club of Princeton. Joseph Quinlan, managing director and chief market strategist at U.S. Trust, Bank of America Private Wealth Management and a fellow at Johns Hopkins School for Advanced International Studies, will speak on “Transatlantic Trends.” Cost: $45 ($25 for members of either organization). For more information and to register, go to www.princetonchamber.org.
One area company that does a lot of international business is Tektite, started 24 years ago by Scott Mele, its chief executive officer, who was previously international sales manager for Princeton Tech in Bordentown, which sold consumer lighting products. In a related industry, Tektite concentrates on battery-powered lighting for more rugged uses, for the military and the government, for example, helipad signals, escape lighting for submarines, and infrared strobes.
“I knew the markets,” Mele says. “Originally, we started in scuba diving, recreational and military diving, and our first international customer was Jacques Cousteau’s company, Aqualung.” Noting that in the week of his interview Tektite had shipped to Latvia, France, China, Hong Kong, and Australia, among others, Mele says, “we ship internationally almost every day:
Mele offers some suggestions to businesses that want to expand internationally:
Use your local resources. For a business interested in exporting, Mele suggests taking some kind of introduction to exporting to get familiar with the rules and regulations. These, he says, are usually free or of nominal cost.
One place to turn is Thomas P. Mottley, senior international trade specialist, U.S. Department of Commerce, at Monmouth University. Through a joint agreement between Commerce, the Trenton Export Assistance Center, and the International Trade Administration, businesses that export in Mercer, Monmouth, and Middlesex counties can get support via export seminars and onsite consulting. Call Mottley at 732-263-3641.
Another resource is the Small Business Development Center at the College of New Jersey (609-771-2947 or email@example.com.
Mele also suggests checking out the U.S. Export Assistant Centers in New Jersey, which help New Jersey companies identify and evaluate international partners, navigate the logistics, and access country-specific market research. For more information, go to export.gov/newjersey.
Be aware of the U.S. government’s trade restrictions. “Depending on the product, you need to know what the export regulations in the U.S. are and whether there are any restrictions,” says Mele. “Some of the things we sell are more sensitive; if you are selling American flag pins, you don’t have to worry.”
To get information on what is prohibited to ship in general and also by country, check the website of the U.S. Postal Service. Once his company shipped a diving knife that is not allowed in Australia, and it was confiscated by customs.
There are also some countries where you cannot sell anything because they have engaged in activities contrary to U.S. national security or foreign policy interests. “You can’t send a button to Cuba or to North Korea, or most things to Syria,” says Mele. He explains that the Bureau of Industry and Security publishes the Entity List, which includes the names of foreign individuals, businesses, research institutions, governments, and private organizations that are subject to specific license requirements for export.
Make sure you get paid. This is less of a problem than it used to be, says Mele, who notes that today international customers can pay with credit cards, Paypal, or bitcoin before shipping a product.
Of course you have to be very careful, and problems can crop up if you’re not.
“The biggest thing you have to watch out for, if you are doing small consumer orders overseas, are orders that are scams,” says Mele, adding that orders taken on a website need to be watched carefully. For example, say a credit card order comes in for $1,700 from Indonesia, and the order history shows that a charge was declined on one card and then charged on another. “Looking at the products ordered, we voided payment,” says Mele. “We were 99 percent certain that the credit card number was stolen, even though our bank approved it; we voided the transaction and sent the money back.” He adds that companies need to be aware of the rules regarding credit card transactions and that they need to be just as careful with credit card transactions in the United States.
Mele notes that businesses should be particularly wary if people from Indonesia, Singapore, or Nigeria contact them and want to pay by credit card. “”Red flags should be waving; all are well-known areas where stolen credit cards are used,” he says.
If you do accept credit cards, you should talk to your credit card processor about how to avoid fraud chargebacks, suggests Mele, adding that any transaction greater than $1,000 should be done by a wire transfer. “Talk to your banker about the process for receiving incoming wire transfers and what the fees would be,” he says. Even transfers can have issues. Recently one of Mele’s customers from Latvia forgot to put in an account number, and the order was delayed 10 days. “We have a close relationship with our banker to troubleshoot this sort of thing,” he says.
Expand your global business by attending trade shows. Over the last year Tektite has attended the military Eurosatory show in Paris and the DSEI defense and security international show in London, and it is looking into the IDEX show next year in Abu Dhabi.
“If you don’t have connections, you have to do these types of shows,” says Mele, noting that most trade shows in the United States also have international representation. “We would talk to the international attendees and find two to three new customers every year,” he says, noting that his company sells primarily wholesale to international distributors or dealers who resell his products to stores.
The bottom line is that you have to know your trading partners. Tektite sells to distributors it has been dealing with for years. But even people he meets at shows, who have a business card and a catalogue, need to be subjected to due diligence.
“We won’t sell anything to them immediately; we will look at their website, its history, when it was created, and how long it has been registered,” says Mele. To find out this information, businesses can go to www.whois.com/whois/ and type in a website address. “It is pretty easy to tell a legitimate company from someone who set up something last week to defraud you,” he continues. If the website looks brand new and has a “simple, hokey home page” with no depth that looks like it was set up by a “website tonight” business, says Mele, “I would ask more questions.”
Mele, the son of a retired New Jersey state trooper, studied engineering at Stevens Institute of Technology and business management at Seton Hall and Upsala. He has held management positions at Warner-Lambert, Playboy International, and Scanticon Hotels, has been general manager for specialty retailers, and has been an instructor at Princeton University.
Mele founded Tektite, like many start-ups, in his garage in 1990. Over the past 24 years, he has built the company into a vertically integrated manufacturer. Tektite manufactures and sells specialty lighting products incorporating leading edge technology. He serves as the chief designer. A resident of Langhorne, Pennsylvania, Mele is a licensed scuba instructor, as well as a member of a ski patrol.
Summarizing what a newbie in international business should do, Mele says, “You need to know your product and your markets, and you have to do some research; but you shouldn’t let it intimidate you.” And for his own business, it has been worth it. “Over 25 percent of our business this year will be export,” he says.