Thursday, 22 February 2018
Turkey's secret weapon in the USA should be strong delivery network

Hakan Taşçı - Washington DC Representative Turkish Confederation of Businessmen and Industrialists (TUSKON)

turkey_usa_tuskonThe United States of America corresponds to 25% of the world economy with its 15-trillion-dollar economy and population of 311 million people. USA is also the most consuming and trading country of the world with its income per capita over 48,000 dollars in 2011. While the USA makes 1.5 trillion-dollar export and 2.25 trillion-dollar of import, the country has 30 million enterprises, and nestles 30 percent of the world's millionaires, and 40 percent of the billionaires. 161 out of 321 significant inventions of the century selected by Britannica invented in the USA. With this aspect, we can say that the USA is one of the countries that have the highest technology and it is an entrepreneur country. When we consider the fact that average income per capita is 48,000 dollars, we will have a better sense on how important the USA market is.

The road to top 10 goes through the USA
The only solution for a country, which is decisive to become a global economy in the world and aims to be in top ten, is to become active in a market like this. There is no doubt that without getting a significant market share from this country, it would be very hard to be in top ten. Within this frame, as TUSKON, we are an organization, which has been continuing its active market research and commercial works since 2007. In the recent year, 23 of our committees have visited the USA and over 400 executives have gotten the chance to better analyze the potential in the market by making bilateral discussions. These committees, which have participated in many fairs, have branched out in the states of the USA, and have analyzed the infrastructure of more than 20 states and have tried to analyze their potentials for Turkey. Along with this, the companies over a certain scale have accelerated their investments. The USA has become one of the more advantageous markets especially after the devaluation in the exchange rates.

Success key is 'local partners'
For TUSKON, the local partners, who are in the heart of the market for the entire year, not for a week or 3-5 days, who are familiar with the local environment and can give better orientation, are the most critical musts for success. Thus, we think that Turkish-American Chambers of Commerce, which are actively working in around 20 states, have the potential to function effectively. If they are supported and the barriers, mostly psychological barriers, to trade can be removed, our trade will have the potential to multiply in short term.

Either make investment, or establish a distribution network
When we analyze the import and export figures of the USA, we can see that successful companies have come to the United States with investments or sent natural resources. Only the companies, which have invested in domestic market or created the distribution channels of their own companies, can succeed. This means a major investment in a vast and scattered geography…Thus, one of the most reasonable strategies would be starting with the markets that you think you have advantage and addressing to the market by spreading out locally as far as possible and by expanding after gaining profitability. If we consider that the export products of Turkey are mostly the sectors that require labor force and capital, this will make us keep the potential in reasonable levels without exaggerating.
It does not matter where the investment come from, it generates a solidarity that increases collaboration and positively affects the trade. However, the most important proof of the fact that the American companies consider Turkey as a market is the investment decisions that start to increase recently. Within this frame, the investments will have a decreasing effect on Turkey's import. This will create an advantage for Turkey. The potential to increase import is always available. However, it should not be forgotten that unless Turkish industry spreads its own technology and production in domestic capital, Turkey may undertake the role of Mexico in this region and this will not create an effect that increase benefit in long term.

The Chinese gained strength with supply chains
Logistics factors are one of the significant fields that affect trade… Such that the Chinese companies have succeeded in the US market by creating a strong supply chain of their own. The works for this still continue in leaps and bounds. After that, the American companies have regarded China as an investment area and they have preferred to decrease production costs by investing in his region. Although Turkey expresses correct steps in this way, it has not taken any steps yet! Taking these steps will only be possible by mutual investment of major companies or some other companies by sharing risks. Even though the locations of the logistics centers have been chosen, their activity method, infrastructure type and the shaping of this infrastructure have not been cleared out yet.
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