In The World is Flat, A Brief History of the Twenty-first Century, Thomas L. Friedman divided the 21^st century into three eras:

Globalization 1.0  "…shrank the world from the size large to a size medium,” and “...the dynamic force was countries globalizing," it was "about countries and muscle,"

Globalization 2.0  "…shrank the world from a size medium to a size small..." and "...the dynamic force was companies globalizing...,” The "key agent of change...was multinational companies.”

Globalization 3.0 "…is shrinking the world from a size small to a size tiny and is flattening the playing field at the same time."

Friedman wrote: "The phenomenon that is enabling, empowering, and enjoining individuals and small groups to go global so easily and so seamlessly..." is "...the flat-world platform.” Under this premise, going global (i.e.; exporting and importing) in the "flat-world platform" should be easy and seamless. And if it is easy and seamless for individuals and small groups, it should be a snap for companies.

The facts are: The steps involved in exporting and/or importing are far from simple and the areas, issues and concerns that must be assessed, evaluated and planned for by a business considering exporting and/or importing are complex.

What follows are some of the components which must be considered and a suggested evaluation methodology.

S.O.R².T² Evaluation

We suggest a company begin by performing a S.O.R².T² Evaluation. S.O.R².T² is WES Corporation’s abbreviation for: (S) Self, (O) Other(s), (R²) Rules and Regulations and (T²) Transaction and Trade.

(S) Self

What does the company do? What products or services does it provide? What resources and raw materials does it use or require to provide or produce its service(s) or product(s)? What functions, operations and assets are required, performed and used? What are the objective(s), costs/benefits and risks to the company in exporting and/or importing?

Sources of data and information for this evaluation include the business plan, annual reports, financials, market studies, customers, plant(s) and facilities, and forecasts.

(O) Others

Who are the exporting and/or importing targets and/or partners? Where are they located? What do they do? What resources and raw materials do they use or require to provide or produce their service(s) or product(s)? What functions, operations and assets do they have, require, perform and use? What are their objective(s) and the costs/benefits and risks to them in exporting and/or importing?

Data and information for this evaluation would include the target and/or partners' business plans, annual reports, financials, market, customers, plant(s) and facilities, and forecasts. Sources for the data and information would include the company, country, U.S. Government (Department of State, Department of Commerce), U.S. quasi-governmental agencies (Export-Import Bank, EXIM), trade shows and missions, and market research.

After you have completed (S) Self and (O) Others, we suggest you perform a screening that includes wants/needs, cost/benefit and a pros/cons analyses. If you conclude that there are concrete reasons for you to proceed, your next steps are to complete (R²) Rules and Regulations and (T²) Transaction and Trade.

(R²) Rules and Regulations

What is the trading relationship between the countries? What trade arrangements and/or free trade agreements (FTAs) are in place (examples: Chile, Singapore, Morocco, Dominican Republic-Central America, Bahrain and Oman)? Which are at risk or potential risk (example: North America Free Trade Agreement, NAFTA in the current political climate in the United States)? What is the status of proposed agreements (examples: Panama, Peru, South Korea) and what agreements have been rejected (example: Columbia)? Do rules and regulations require a certain percentage of exported and/or imported services, products or item be “home” based, sourced or content? Do rules and regulations require the product or item to be a certain percentage recyclable or “green” and does it conform to specified standards or comply with specific environmental rules and regulations?

(T²) Transaction and Trade

What documentation is required (examples: Certificate of Origin, Customs Trade and Partnership Against Terrorism, C-TPAT certification)? Has the service, product or item been classified (example: Harmonized System classification number)? What tariff will be applied? What logistics will be required and how will they be secured, handled, and checked? Who will be responsible for the logistics? What contracts will be used? What are the methods of payment? What are the arrangements for payment? What are the foreign exchange considerations? What financing forms are available?  What are the risks that must be evaluated (commercial: service, product, or item; foreign exchange; political; documentary; and transportation)?

Conclusion

After you have completed a (S) Self, (O) Others, (R²) Rules and Regulations and (T²) Transaction and Trade evaluation, you will be in a position to perform comprehensive wants/needs, cost/benefit, and pros/cons analyses. If you conclude that there are concrete reasons for you to proceed, your next step is to start the process toward becoming an exporter/importer.

		David Woltz is a principal of WES Corporation, a technology and application-based company that provides and implements solutions to problems in the areas of economics, engineering, energy and the environment. WES Corporation has the practical, pragmatic knowledge and experience to provide production, process and environmental evaluation and economic analysis expertise to companies. WES Corporation has U.S. and international experience with projects in the private, public and government sectors.