GRIIT Newsletter: Feature Article

The Cost of FREE

“The fact is, investing in your business doesn’t cost, it pays.”   Steve Strauss, Small Business Lawyer

At the start of 2018, the owner of a four-year old international trading company, albeit not the first one to do so in the five years of GRIIT’s existence, requested that I conduct both in-depth and basic international trade research for…FREE. Companies that embrace the FREE-based financial planning model are setting themselves up to only receive the outcome based on what they put into their import/export companies…nothing. Or, as I have seen, the FREE-based financial planning model results in paying for costly errors in the international market that could have been avoided if the business owner just invested in international market research in the beginning. 

Do not get me wrong. I understand that small companies with an extremely limited budget rely on free resources to get started, such as business plan counseling and learning the basics of international trade. Such resources are shared via GRIIT’s social media outlets and website. Some of GRIIT’s training sessions are offered as a complimentary service, especially for small business owners. (See our February 1st free event at https://griit.org/trainingandworkshops/.)

I, too, started out taking full advantage of the resources offered by various government run agencies for guidance. Eventually, I graduated to generating the revenue necessary that could be invested back into my company, which included purchasing specialized services.

In other words, to grow my firm, I found value and invested in the expertise of small business lawyers, accountants, database creators, graphic designers, and web designers.

The referenced business owner made such a request despite being familiar with the quality of my work over a four year period. During our scheduled meeting this month, a list of detailed questions about a particular sector had been presented to me. Upon mentioning that answers to these questions would require the in-depth international trade research that GRIIT provides, the business owner seemed disappointed that I would dare charge for this level of work. This is work that would be labor intensive and require a significant amount of time and use of GRIIT’s resources.

The same person requested that I gather basic information on the export of specific products to a certain market. I was “informed” that the information was available for free. However, collection of the information would require a good amount of time. As in numerous cases, I am “educated” about the availability of FREE basic international trade data as a way of encouraging GRIIT to provide more specific and focused firm level data for FREE. 

Usually my response is as follows: How has that worked for you? There is often silence.

Case Studies: The FREE-based Financial Planner

Here are two cases of business owners who relied mainly on free-based services to try to expand to the international market, the results, and the opportunities for success that they missed when seeking FREE research from GRIIT.

1. Importer

  • Interest – Research on how to best take advantage of the African Growth and Opportunities Act (AGOA) to do business with African countries
  • Steps taken – Received export counseling from various government-run agencies
  • Progress – Trouble turning advice from consultations into implementation resulting in a business that existed in name only; failure to generate revenue after more than five years
  • Opportunities missed – Develop a sustainable business structure; Research on trade trends, competitors, and buyers; Design a customized strategyfocused on his specific business and product; On-going strategy sessions (in-person or virtual) based on business owner’s schedule and time needed

2. Exporter 

  • Interest – Export a product from the United States to several overseas markets such as Mexico
  • Steps taken – Received export counseling from various government-run agencies
  • Progress – Failed to turn information into a solid export business 
  • Opportunities missed – Identify the right product for the market(s) of interest; Analysis of the company’s resources and capacity; Focused research on trade trends, competitors, and buyers; Design an implementation strategyOn-going strategy sessions (in person and/or virtual); Connections with GRIIT partner based in Mexico

Case Study: The Investor

On the other hand, serious business owners view upfront research as an investment rather than a cost. Here is one of my favorite stories of an exporter to Latin America, who benefited from my training and guidance four years ago.

1. Exporter 

  • Interest -Export a commodity from the United States to a Latin American country
  • Steps taken – Invested in training on the export process
  • Progress – Developed a business planconnected with key resources, sought assistance from a service provider within the country. When the service provider was unable to offer certain types of information, the exporter had the skills to conduct the research necessary to determine the rate of duty for the specific commodity. The exporter’s knowledge of the type of research needed allowed the exporter to continue the search for someone based in the country who had the proper research skills to add value to what the exporter already knew.
  • Opportunities gained – Saved money in the long-run, reduced risk of costly errors, tools to know what type of research is needed, basic knowledge of how to collect the right data for the business 

Think About It and Act
 

Would you rather spend thousands of dollars within a single month on hotels, airfare, food, ground transportation, etc., while figuring things out along the way?
Or would you rather invest less than $1,000 for up to two months worth of targeted research designed for your firm’s growth opportunities in the right market(s)? (Learn more at https://griit.org/services/packages/.)Start investing in your business today to avoid the long-term costs of the FREE-based financial planning model

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