Currency Events

Is your business ready for the euro?
Magazine Contributor
3 min read

This story appears in the September 1998 issue of Entrepreneur. Subscribe »

Everybody's heard that on January 1, 1999, the European Union (EU) will adopt the euro as its currency system. But what U.S. exporters might not realize is that it means doing business in European countries will get a lot more complicated.

"Companies have to prepare now for a far more competitive marketplace in Europe," says Thomas P. Mottley, an international trade specialist with the U.S. Department of Commerce. "It's going to take some adjustment, but it can be done."

To start with, business procedures must be modified as soon as possible--think accounting, computer, marketing and payment systems. For instance, most U.S. businesses currently invoice European customers in U.S. dollars, get paid in dollars, and process letters of credit in dollars. "But European companies may now insist on payment in euros," Mottley explains. "If you want to do business in Europe, you need to be able to bill in their currency."

With only four months to go, the clock is ticking--so prepare to put forth time and money to modify your procedures. Because the EU is fast on its way to becoming the world's largest unified trade bloc, it will be an investment well worth it in the long run.

Out Of Bounds?

Not with global wireless service.

If you depend on the freedom your cell phone provides, you're going to love the new technology developed by Iridium North America, a cellular phone service provider in Tempe, Arizona. Set for launch later this month, the Iridium service promises its network of 66 satellites will keep users connected to any point on earth.

This means you can call someone on a ship in the middle of the ocean from a remote desert location--on your cell phone. The technology should come in especially handy for entrepreneurs conducting business overseas, because more than half the earth still lacks reliable telephone service. "With our satellite system, [you get] the security of being able to make and receive calls anywhere on the planet," says Iridium president Jim Walz.

The unlimited access to a phone also saves time: Who wants to be stuck in a hotel room for two hours waiting for a client to call back? Or deal with pay phones that need foreign currencies and operators who speak unfamiliar languages? Iridium is betting entrepreneurs will opt for its technology instead. "If they need to go to Japan to close a deal, for example, information retrieval in a timely and accurate way is critical," Walz explains.

Iridium's service also covers faxes and pages. Walz estimates that charges will compare to the going rates for international calls, plus a 30 percent premium per call.

Testing The Waters

Global program lets you try new markets.

It's a question all too familiar to mail order entrepreneurs seeking global expansion: Will my products sell overseas? Until now, it's remained a difficult one to answer.

But that's all changed since the U.S. Postal Service (USPS), along with the Direct Marketing Association, launched the New Market Opportunities Program. The program offers the first complete global market test package for a single price.

For $22,000 ($17,000 if you choose Canada), mail order businesses get a test run in their choice of selected countries. This includes services such as translating order forms, compiling demographic and mailing list information, and evaluating results.

"We need to look beyond our own shores," says Bob Michelson, manager of mail order for the international business unit of the USPS, "and participate in the rapid growth of direct marketing around the world." For more information, call (800) THE-USPS, ext. 2097.

Contact Source

Iridium North America, (800) 281-0043, http://www.iridium.com

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