Build International Business in Commodity and Niche Markets

Within the first month of our new company’s operation, the prices for our product fell by 42% thereby severely limiting our growth potential.   To combat the danger of a one-product company subject to commodity pricing issues, the company needed to look at other products to add.   The  goal was to identify the highest revenue-generating products with the greatest market growth potential.

 

After investigating the vertical market segments from raw material production, supply and pricing, looking at potential sale to the ultimate consumer, the company determined a viable product niche. 

 

For example, the use of Polyethylene Terephthalate  (PET) in carpeting with the changing demands of consumers in home styles, remolding and housing starts  as well as its use in clothing and even custom bottles for new food applications  and even investigating the competition of product substitutes make this a wider market to tackle.

 

The next step was identifying potential suppliers and end markets.  This phase took the company to China, Hong Kong and Mexico to develop these contacts.   Perhaps the toughest part from my perspective was to understanding the international trading requirements including negotiating International Letters of Credit and container shipping documentation.

 

Within 18months, the company grew to $1.5 mil in annual sales and 10 products in 2 niche markets with an international reputation for providing high quality products at a fair price.

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