Interest in and Knowledge of International Economics and Politics

Importing or exporting, even on a small scale, carries with it both opportunities and risks, and the more you know about the world, the better able you will be to take advantage of the opportunities and to reduce the risks.

Suppose you are importing goods by sea from Botswana and they must be routed through South Africa. Civil unrest* in South Africa could result in blocked roads or a longshoremen's strike*, and if you do not know of it you may find yourself waiting for your shipment, not knowing why it does not arrive.

Suppose you are importing from South Korea, and the Korean won is devalued against the dollar*. This means your Korean exporter is receiving more won for every dollar you send him. Since you are probably paying in dollars, the devaluation will not affect you directly. However, if you understand the situation you may be able to negotiate a better price the next time you make a purchase.

Language Ability

You can import and export successfully without knowing a foreign language, but language abilities would allow you to communicate more easily and increase your range of business contacts*. The ability to speak the language of your business contacts can sometimes help even when your communications are in English. For example, it is not uncommon in international trade to receive a letter or telex message from overseas that uses English, but is unintelligible. If you know how sentences are structured in the language of the writer, you can sometimes rearrange the words to better understand their meaning.

As an importer or exporter, you will regularly need to read newspapers and magazines with worldwide coverage*.

Since you will probably be dealing with people who are not fluent in English, you will need the ability to communicate in a simple, easily understandable way without using the slang.

Cultural Empathy

Sooner than you think, involvement in international trade will result in your meeting foreign buyers or sellers face to face. In these meetings, it can be very helpful if you have some feeling for the culture of these associates or at least are willing to tolerate and respect people who think and act differently from the way you do. For example, it may bother you if people speak to you without looking at you, but this is done out of respect in some countries. It may appear rude for people to belch loudly after eating*, but this may be done deliberately to show that the meal was satisfying.

You may need to be careful of your own words and actions. You should not sit with the sole of your shoe facing a Korean*; if you do, you are symbolically stepping on him. You should try not to turn the conversation to business too quickly when dealing with someone from Latin America or the Middle East; a person from either area would not want to do business before establishing a degree of personal rapport*.

Attention to Detail

Finally, a successful international trader must be able to pay considerable attention to detail. You will be dealing with people or companies that are far away, whom you may not know, and your meeting of minds will be expressed on paper*. All documents must be prepared and read with great care.

For example, suppose you are exporting and expect to be paid by a letter of credit. If the letter of credit says you are to ship from the port of San Francisco, and you ship from the port of Oakland, this careless violation of a term or condition of the letter of credit* could lead to a dispute.

If you are outgoing and aggressive*, and have no patience with detail, you will either have to force yourself to do something you are not good at, or get a partner, or hire an employee who can fill in where you are weak*.

Capital Requirements and Profit Potential

The import/export industry is not one that requires a high capital investment. There are documented cases of people who have started their businesses with less than $200 and have been successful. If you have that little, however, you have to move very slowly and avoid taking any risks.

You can start your business as an agent for a very small sum of money because you do not have to pay for merchandise or international transportation. Unfortunately, you will have to compete with everyone else who is trying to start as an agent.

Books on small business and entrepreneurship give suggestions about how to raise capital to start a business. These include using personal savings, mortgaging your home, borrowing from banks and credit unions, borrowing from relatives, and approaching venture capitalists.