Building international business relationships

Building international business relationships

The world of foreign trade is complex. Diversity of cultures, different time zones and complicated import and export regulations are all present challenges when building strong relationships with foreign businesses.

Even though it takes effort, it is of critical importance to build strong international business relationships where both parties can benefit from the agreement. If you don’t invest sufficient time in building a trust with your customer or supplier and something goes wrong, you might find yourself dragged into an expensive overseas lawsuit where you may lose. However, if you do manage to build a strong relationship, chances are good that it will lead to increased business. It might even enable you to negotiate more favourable terms.

Here are 3 tips to consider when building international business relationships with foreign customers and suppliers:

1. Establish effective communication first

The potential for misunderstandings and communication gaps can create obstacles in dealing with foreign businesses.

Simple acts such as routine telephone calls or meeting times can be hindered by time differences and low-quality phone connections. It is therefore vitally important to carefully plan face to face meetings and frequent telephonic or video calls. Language can also be a hindrance in building international business relationships. Decide beforehand which language to use in conversations. If the language is not widely recognised by you or your employees, acquire the help of local interpreters to avoid misunderstanding. However, if it is widely spoken, make sure your employees have the necessary linguistic skills to deal with your suppliers.

2. Strong international business relationships grow gradually

Issues are more than likely to occur in the early stages of a supplier-buyer relationship. Therefore it is sensible not to leave anything to chance. An overseas supplier, for example, may require proof of payment before sending a shipment out the door. All copies of transactions made or any currency orders relating to a specific proof of a transaction must be kept so you have a clear record.

Draw up written contracts that are clear and unambiguous. Typically your first contracts with a new supplier will be on a project-by-project or shipment-by-shipment basis. The key is to build the trading relationship slowly. If problems do occur during the process, decide together how to resolve them. As the relationship develops you may move to longer contract periods.

3. Learn about cultural and social differences

Each culture is unique, with a preferred way of dealing with difficult situations. Visiting a business partner overseas might seem daunting at first, especially if you’ve never been confronted with cultural and social differences. To turn the blind eye to these differences might not be helpful in building a strong trust relationship with your supplier.

Invest the proper time to learn the correct meeting protocols, religious rituals and greeting styles of the country. It will also be useful to understand the communication differences in order to better solve conflict situations or to facilitate negotiations. Soon you will discover that you are not only enriched financially, but that building international business relationships is a opportunity to grow as a person as well.