What is NOT going to change as a result of the US/China Trade War

You, along with the majority of American business owners, are wondering how the proclaimed “Trade War” between the U.S. and China will affect your business. Although the dynamics in the market are changing at the speed of light, we’re here to give you some peace of mind by explaining what WON’T change. 

Change is a Constant 

As cliche as it sounds, it still rings true - change is a constant in life, politics, business and beyond. And when it comes to the trade wars happening between the United States and China, it’s going to keep changing. Headlines are altering by the minute and the contents within the news articles are wavering. What IS true about the tariffs, despite the uncertainty of outcomes, is they ARE going to affect the economy. You have to be proactive.

Strategic planning is an important process for any business looking to enter a new market or sell a new product, but it doesn’t stop there. When potential threats to your company’s well-being arise, you need to act. This way, if the final outcome is not in your favor, you already have an actionable plan prepared to execute. 

If the trade war continues, your business may face increased costs for your products. If your sales are significantly impacted by the busy shopping season (back-to-school or holidays), you may see less foot traffic due to consumers having less disposable income after buying these affected but necessary goods. As recently reported in the New York Times, starting October 1st, the current products being imported from China will be taxed an additional 5% (from 25% to 30%). 

Small and large companies alike will be burdened with either hoping for the best with the China trade talks or finding a new manufacturer in the United States. If you choose to bring the manufacturing of a non-necessity to the US, you could find a decrease in sales due to the increase in the ultimate price for the consumer and the lack of inherent “need” for your product. 

We could go on about the potential outcomes, but it is important for your business to gather the right team, and start outlining potential threats and opportunities that arise with this specific conflict. In times of rapid change, you can never be too prepared.

Large Push Towards China’s Middle Class 

Even with the trade talks between China and the US heating up, China remains an emerging market and a powerful one at that. In September 2019 alone, Hong Kong shared the record best day in 10 months and the Chinese yuan gained a two-week high. Although discomfort remains about China’s global sales in response to the trade war, China’s middle class still holds an immense amount of consumer power. 

With over 400 million Chinese people classified as the middle class, this group exceeds the entire population of the United States. The untapped spending power of this demographic is enough to start asking yourself, “Does it make sense to expand my business to China?” Of course, we can help you with that question, but for now, we’ll outline some of the existing spending habits of China’s middle class. 

The majority of the current spending is coming from China’s upper middle class, who have more disposable income. This group spends its money on a variety of goods and services, but passenger vehicles have experienced the most consecutive growth. According to China Power, “...passenger vehicle sales in China have experienced growth for 26 straight years, with 28.9 million cars being sold in 2017. For reference, US consumers bought 17.5 million cars in 2016 and Brazilians purchased just 2.5 million automobiles.”

In addition to consumer products, the higher incomes in China’s population have offered more opportunities to be connected, both online and through travel. Internet use has skyrocketed since 2017, and the power of technology is only projected to intensify in the group. Traveling is at an all-time high. Annual spending on domestic trips increased by over 275% in the past 5 years, and international trips exceeding 2500%. 

Visual Media and E-commerce is the Future 

It’s no surprise that with increased internet usage comes increased connectivity. New and groundbreaking social media applications are notoriously nurtured in China and other Asian countries before they take over the United States. One example of that is the Generation Z forward short-form video platform, Tik Tok. Tik Tok, or the Chinese version Douyin, has been downloaded more than one billion times internationally. The Chinese tech company that owns the platform is valued as the world’s most valuable startup.

Weibo and WeChat are two apps that have taken China by storm, but have yet to capture the interest of the US market. Weibo is an entertainment platform that, “encompasses the features of Twitter, Pinterest, Instagram, Reddit, and Youtube.” In short, Weibo began as a microblogging site like Twitter and has skyrocketed in China. Due to more visually-rich opportunities on Weibo, the platform has tremendously exceeded usership over Twitter. Forecasts from eMarketer points to Weibo surpassing 400 million users in China by 2021.

Lastly, WeChat is a tool that offers mini programs and serves as an all-inclusive app store. Businesses who want their app to be on WeChat’s platform must pay a premium to be there. Users can interact and purchase within any “mini-app” without downloading anything additional to their devices. In 2017 alone, WeChat drove $50 billion into the Chinese economy.

We may have just thrown a ton of information your way, however, it is calming to know that with the ever-changing trade war between the US and China, constant variables still remain. Whether you need help identifying a strategy for the potential outcomes of the tariffs, or if you’re interested in learning more about the opportunities available for your business in China, we can help. Contact us via email (hello@castusglobal.com) or submit a form on our contact page.

3 Sustainable Initiatives your Business Needs to Take

As irreversible environmental tragedies continue to take place: the current fires in the Amazon, the melting of glaciers in Greenland, and the bleaching of Australia’s coral reef, sustainability development becomes less of a public relations tactic and more of an expected business practice.  

In 2014, it became mandatory for European companies with over 500 employees to report on environmental and sustainability issues by the end of 2016. In the present day, you can locate announcements and initiatives from every country on how they intend to regulate companies’ sustainability efforts. 

A study from Newsweek details that companies with an active sustainability strategy perform better. Nielsen data backs up this claim with statistics proving consumers are actively searching for publically-sustainable companies and products. These customers are choosing green-forward businesses over their less-transparent, often-times less expensive counterparts. 

So, there you have it. Three major reasons why your business NEEDS to think green: For the greater good, inevitable regulation changes, and consumer loyalty. Now that we’ve laid this out, and hopefully lit a fire under your feet, we want to give you 3 common initiatives that your company can implement to be proactive.

For the Environment: Implement Change

There are an infinite number of tactics that your company can adopt to become more sustainable. Some of those tactics include building a sustainable supply chain, striving for zero-waste, working with like-minded vendors, and reducing greenhouse gas emissions with renewable energy. Forbes has curated a list of 101 businesses committed to sustainability and the tactics they used to get there. 

What we really want to hone in on is that no company is “exempt” of being sustainable, despite the industry. Take, for example, Ford Motor Company. The automotive industry is known to be among the heaviest polluters [i.e. Volkswagen emissions scandal, or should we say “scandals”]. 

In the past ten years, Ford has integrated a ten-part environmental policy that encompasses their:

  • Move to sustainable fabrics in their vehicles

  • Recyclable vehicle parts in their Ford Focus and Ford Escape

  • Clean Diesel alternatives for pickup trucks 

  • Paint fumes repurposed as fuel 

The bottom line is, you have to make change. No one is free from sustainable development and any efforts can make a world of difference for your business. 

For the Policy: Be Strategic

On January 24th, 2019, the United Nations shared the first-ever environmental policies worldwide report. The report concludes that the entire world is flooded with environmental concerns, and the vast majority of countries have at least one environmental law or regulation in place. 

You may be wondering - what’s the problem then? 

Well, deforestation, rising global temperatures, and more environmental tragedies are still taking place. This, along with research completed by the Environmental Law Institute, lead us to conclude that policies are not being followed. 

Director of International Programs at the Environmental Law Institute, Carl Bruch, states in the Pacific Standard “It's not that we shouldn't develop more laws, but the emphasis needs to shift from development of policies and institutions to implementation and enforcement.” 

From this insight, we hope you will take strategic action and implement sustainable change sooner rather than later. Right now, corporate environmental moves are big. Big enough to make national or even international news. Wouldn’t you rather make positive change and reap the benefits of positive press than make change because the government is saying you have to? 

We’ll let you think on that. 

For the Economy: Spread the Word

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Julia Wilson, the VP of Global Responsibility and Sustainability at Nielsen can be quoted saying “Eighty percent of the public last year [2018] expected company CEOs to take a stance on social issues. We see more people taking action; almost eighty percent of the respondents have done something to support “just” companies, either buying from them or working for [them] or investing in [them] or taking some other form of action.”

Consumers are spending more time than ever researching companies before they make a purchase. Patterns show that conscious purchasing like this will impact change on its own. So, take this advice. Change your processes, increase your sustainability efforts, and tell the world! 

Share on your company’s LinkedIn, get a press release distributed through the newswire, and tell everyone you know of your company’s forward-thinking initiatives. Your brand loyalty will expand with your existing customers, and new customers will choose your company over your competitors. 

Need help convincing your team to commit to sustainability? Not sure where to start strategically? Reach out to us via email (hello@castusglobal.com) or through our contact form. We can help you navigate this shift in any market across the globe.

Consultants: Your Secret Weapon to Growing Your Business in 2019

Imagine this: you have just finished presenting your 2019 goals and projections to your board of investors. All of the pressure surrounding 2018 and the work that goes into defining measurable success in the new year is over.

January 1, 2019 rolls around - you’re bright-eyed and bushy-tailed for the new year.  You sip your morning cup of coffee (or diet coke - and yes, this is a nod to Amazon CEO, Jeff Bezos), and you get down to business. It’s time to take action.

  • Who should I talk to first?

  • Do we have the capacity to meet our objectives?

  • Do we have the right people on board?

You realize you have set ambitious growth goals for yourself and your business in 2019, and you’re not sure where to start.

Thankfully, we do.

Goals will stay incomplete without a strategy

Of course your goals will feel lofty and unattainable if you don’t have a strategy or the resources in place to point you in the right direction.

In an article published in Forbes by Senior Associate Dean of International Business and Finance, Bhaskar Chakravorti advises to move beyond typical business class strategy and focus on emerging markets and opportunities.

“It is time to take another look at how we are preparing managers to do business in emerging markets. Business strategy needs to be re-thought and re-learned. If you remain trapped by axioms developed for twentieth century industrialized markets, you will suffer trapped value in the emerging opportunities of the twenty-first century.”

Chakravorti goes on to address business executives by recommending they put aside traditional, by-the-book business principles and approach the present day global climate from a different perspective.

This is where we come in. Our team offers expert insight and the resources you need to meet your defined goals this year. Our punch and competitive advantage lies in the fact that we are analyzing your business from an unbiased point of view. Our objective perspective gives us the opportunity to reassess your existing processes and implement out-of-the-box tactics that will drive growth.

On your mark, get set…

By hiring a consulting firm, you’re investing in the proper expertise and processes to reach your business goals. We pride ourselves in our expertise in strategic planning, but also in our ability to prepare teams for the execution phase.

Once your strategy is complete, you have to be ready to implement. The “readiness” phase is one that many businesses opt out of. If you have the strategy in hand and the willpower to complete your goals - then what’s stopping you?

You may have thought that was a rhetorical question. But, we have three answers to why you should never execute immediately post-strategy:

1) You’re lacking in qualified resources

When speaking solely about global market growth, you will need the right team representing your company on the front lines. Our ability to find your business the right resources is crucial to the success of your strategy. We have hired, trained and managed teams all over the world, so when you need to hire in order to reach your goals, we will be right there beside you.  

2) You haven’t prepared for the possible cause-and-effect of entering a new market

With every key business decision comes a possible response. Whether the response is positive or negative, from investors or from consumers - you and your leadership team need to be prepared to make hard decisions for the future of the company.

As your Trusted Advisors, we will ensure that you and your team are ready to meet your 2019 goals and then some. What are the next steps once you hit your goal? Is this new initiative feasible? We will guide your company and ensure your partnerships are scalable and exponential for years to come.

3) You aren’t sure where to begin
The final step of our strategic planning process is the comprehensive market evaluation. This step will outline the order of strategic implementation that needs to occur to get closer to meeting your goal. Once you have digested the plan, it is crucial that all involved in the execution are fully aware and ready to begin. However, despite having a true action plan, the next steps can appear overwhelming. That’s why we make sure to stick around after the planning period is over.

“Strategy. Readiness. Execution. It’s this philosophy that makes our approach different.”

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Executing your growth plan can be simple with the right support

Many consultants stop assisting once the planning period is over. However, we believe that no opportunity can become a reality without action. We will accompany you and your team through the strategic execution until you feel confident in reaching your goals. We can help execute prospect sales pitches, contract negotiating, new account setup, and provide additional value in many areas of your business.

The defined secret weapon to growing your business is hiring a Trusted Advisor, but the true value is much more than that.  Having a consultant on your team means you can set the most ambitious goals for your business and you’ll feel confident in knowing you have the right resources behind you. You will find unmatched value in our broad experience and our powerful network across the globe.

Be more. Be global.

2019 could be the year your company turns a profit, gains a new audience in a new market, orhits a revenue milestone. Whatever it may be, we are ready to dive in. For more information on our global business development services, contact us via email (hello@castusglobal.com) or submit a form on our contact page.

How to Get Noticed on the Shelf

Congratulations! You have a great product, and you have interest from retailers. In fact, they want to put your product in their stores. Many brands believe “getting on the shelf” is the ultimate goal. They believe securing placement and distribution is the end-game for a product. In actuality, it’s  just the beginning.

If your product is on the shelf and customers don’t notice it – they don’t buy it. If customers don’t buy your product, you’ll be off the shelf in no time and back to where you began – but with one less opportunity. Follow these steps to ensure your product gets noticed and that getting on shelf is only the beginning of your success.

Step One: Why Buy

What motivates a customer to buy your product? What is the “reason to believe” your product will solve their problem? If you can’t answer the question of why a customer should buy your product in a clear and succinct way - they won’t. The reason for customers to believe in your product – the value proposition – must be easily understood and clearly articulated. Know exactly who your ideal customer is and why they need your product.

Step Two: Tell your Story and Communicate the Message

Once you have identified the value proposition, and you have identified the ideal customer for your product – you need to communicate the solution. The adage “a picture is worth a thousand words” is incredibly relevant in this situation. Your product will be next to many other products, on a crowded shelf, in an unknown retail setting. If you try to communicate your message to the customer through too many words on a package, or a sign, you’ll get lost in the shuffle. Figure out a way to effectively communicate your message and grab your ideal customer’s attention with minimal text and compelling imagery. You’ll have a much better chance of “standing out” from the crowd.

 Step 3 : Get Prime Real-Estate

Whether on an end-cap or at eye-height on the shelf, improving the physical positioning of your product in stores will encourage customer interaction. Identify opportunities in the physical store space that will call attention to your product and engage customers. Can you setup in the middle of an aisle? Is there a place near the check-out? Perhaps there’s a front window to the store that can showcase your brand? More “facings” for your product means more opportunity for customers to see, and, hopefully, buy your product. And, don’t forget about cross-merchandising. Can your product be merchandised, along with other complimentary products, in addition to the category listing?

 Follow these suggestions when working with retail partners and you’ll be sure to optimize the placement you have worked so hard to achieve. Remember, getting on the shelf is only half the battle. Your product needs to sell and for that to happen – your product needs to be noticed by customers first.

For more advice on how to strategically place your products in the right retail outlets, or build an impactful Sales Process, contact Castus via email (hello@castusglobal.com) or visit our website: http://www.castusglobal.com/

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