By Fred Reilly, American Attorney and English Solicitor.
This post highlights 5 crucial decisions that every United Kingdom entrepreneur and small-business should consider when formulating their strategy to sell to American customers/clients.
Every entrepreneur and small-business owner wants to avoid uncertainty. These 5 crucial decisions will help you get clarity on the business and legal issues that impact your American strategy.
DETERMINE YOUR END-GAME IN ADVANCE
For U.K. companies, America represents a rich market with endless opportunities. Like any foreign market, it can also quickly become a maze. Before charging into an effort to enter the American market, I highly recommend that you determine your end-game in advance – how can you best monitize your entry into the American market?
Your ultimate objective may be to (i) generate some sales in a new market and test the waters, (ii) establish a relationship with an American agent or distributor, (iii) establish your own physical distribution facility in the United States, (iv) establish your own physical presence or manufacturing operation in the United States, or (v) some variation of the above.
This decision is crucial because it will shape all tasks that follow. For example, let me briefly contrast two strategies from the above list:
*Generate some sales in a new market and test the waters. This option is the least complicated and can be implemented quickly. Many U.K. companies can simply start generating U.S. leads by targeted internet marketing and search engine optimiszation. At the outset, you’re trying to determine how much of a market exists in the U.S. for your product/service and how you can best reach your target market. As you gather more experience with the American market, your focus may rapidly shift to one of the other options.
* Establish your own physical presence or manufacturing facility in the United States. This option is far more involved than testing the waters. You’ll need to determine the best physical location within the U.S., lease or buy a site, establish a U.S. entity, hire staff, comply with employment law and other legal requirements, and address local, state, and federal taxation issues.
The expense of implementing either strategy can be substantial and it certainly pays to get it right from the outset.
IDENTIFY YOUR TARGET MARKET
What is your target market? Do you plan to sell: (i) directly to customers/clients, (ii) via an agent, (iii) through a distributor, (iv) in conjunction with a joint venture partner, or (v) through some other channel?
This decision also has far-reaching consequences. What works in the United Kingdome and the European Union may not necessarily work in the United States. Failure to identify your target market at the outset of your market entry strategy can result in a substantial waste of time, effort, and money. Plus, if your effort gets off on the wrong foot and results are slow, enthusiasm for the American market will decline as frustration inevitably builds. There must be an analysis of how to reach your customer/client in the most effective, most efficient, and most profitable manner.
UPDATE TERMS AND CONDITIONS
I’m often asked to review contracts (including website Terms and Conditions) on behalf of U.K. companies that want to enter the American market. It’s been my experience that my U.K. client’s contracts are typically sound and only require minimal tweaking. Seldom has a comprehensive redrafting of the contracts been necessary.
The most commonly added/revised contract provisions are (i) pre-trail mediation, (ii) choice of law, (iii) interest to accrue on past due accounts, (iv) termination of the agreement, (v) collection costs (including attorney’s fees) in the event of a dispute, (vi) confidentiality and non-compete provisions, (vii) intellectual property rights, and (viii) branding issues.
PROTECT YOUR BRAND AND INTELLECTUAL PROPERTY RIGHTS
Every U.K. company that enters the American market should take affirmative steps to protect their brand and intellectual property rights. Often, this step is simply overlooked and can lead to some very adverse outcomes. For example, failure to clarify how an American agent or distributor uses your brand or failure to clarify ownership of intellectual property rights (trademarks, tradenames, domain names, etc.) can lead to nasty disputes. You can’t effectively monitize your brand and intellectual property rights if these rights have been compromised or lost.
MINIMIZE EXPOSURE TO LAWSUITS
For almost every U.K. client that I counsel, this is a biggie. America has a reputation for being a litigious society – unfortunately this reputation is well-earned. Although you can never comletely pre-empt a potential American plaintiff from filing a lawsuit against you, there are several distinct actions that you can take to minimize their opportunities to do so.
First, include a pre-suit mediation provision that requires you and the potential plaintiff to mediate the dispute as a contractual precondition to them ever filing a lawsuit. Most disputes can be solved at pre-trial mediation without the expense and anguish that goes with defending a lawsuit. Second, include an appropriate choice of law and choice of forum provision in your contract that will require a lawsuit to be litigated in the United Kingdom courts, not an American court. Third, inclusion of an appropriate attorney’s fees provision in your contract will serve as a substantial deterrent to frivilous lawsuits.
Your attention to these five crucial decisions will substantially increase the likelihood of a successful entry into the American market.
INITIAL CONSULTATION + FLAT FEE + GUARANTEE
For a limited time, I’m extending an initial consultation, flat-fee offer to United Kingdom companies that want to enter the U.S. market. In this inital consultation, I’ll do the following:
1. Review your company’s website and provide detailed email evaluation.
2. Evaluate your website’s Terms and Conditions (or other contract) and explain why specific additions or revisions may be necessary.
3. Explain how to expedite your dispute process, dramatically decrease exposure to lawsuits in America, and minimize collection costs.
4. Recommend and explain 5 concrete strategies for generating more revenue in the U.S. market.
5. Recommend and explain 6 specific and easily-implemented strategies to increase traffic to your website.
6. Evaluate your company’s protection of its intellectual property rights.
7. Make three specifc recommendations on how to protect your Brand in the U.S. market and how to avoid the common pitfalls made by U.K. companies.
8. Thirty minute follow-up consultation via Skype to answer your questions and discuss your strategy.
The flat fee for this initial consultation is GBP 400. Why do I charge a flat fee for this inital consultation? I’ve found that entrepreneurs and small businesses need solid legal advice on these issues, but simply can’t commit to a blank check when obtaining legal advice (especially when American attorneys charge an average of US$295 per hour). Thus, I’ve specifically itemized what a client will receive in this initial consultation in exchange for a reasonable, quantifiable fee.
Guarantee: If you’re not 100% satisfied, there is no fee. Period.
How do we get started? Contact me asap. Once I’ve obtained some initial information from you, my turnaround time for this initial consultation is two days.
Act now. This flat fee initial consultation is only valid until June 10, 2011.