Trent Sukovieff is savouring the comforts of his hometown of Calgary after spending the past four months in Iraq. “It’s like Christmas, New Year’s and everything all rolled into one,” he says of his visit. These days, home for Sukovieff and his fiancée is Dubai, where he heads up the Middle East headquarters for Waterworks Technologies, the company his father Len founded.
Building a water-treatment plant in Iraq is a tricky business, requiring patience and sensitivity to the local culture, Sukovieff says. Procuring a nut or bolt of a certain size, available at any hardware store in Canada, might take a week in the war-torn country. If you need something done right away, you can’t just call head office; they’re all asleep, so the support of a full-service office in nearby Dubai is a necessity.
A lot of companies in Canada would ask, why bother? Sukovieff has a compelling answer. “We have a lot more business coming out of our Dubai office than we ever have out of the Canadian office,” he says. The company has projects on the go in Oman, Bahrain, Qatar, Saudi Arabia, Jordan, Egypt, Kuwait, Afghanistan, Djibouti—places thirsting for the proprietary water and waste-water treatment systems that Waterworks designs.
The company started in 1985 serving clients in Canada and the United States but very quickly gravitated to the developing countries where the demand for water infrastructure was greatest. “In Canada we have a lot of water,” Sukovieff shrugs. Thus the potential for his firm’s growth here is limited. And the challenges of living, working and profiting abroad? To him, it’s all part of the adventure.
Would that all Canadian companies were so worldly. Maclean’s, along with Canadian Business and Profit, surveyed 833 businesses across Canada between April 15 and May 4 as part of the Business without Borders initiative, and 60 per cent claimed to be engaged in business outside Canada in some way, whether exporting, sourcing goods and services, or working with foreign partners.
The most surprising result, though, came from the 333 respondents not doing business internationally: 62 per cent expressed no interest whatsoever in doing so. Only three per cent indicated they planned to start within 12 months, while 18 per cent said they were gathering information. Nine per cent said they were interested in doing business abroad but were not sure where to start. These homebodies—all with annual revenues in excess of $1 million as per the survey parameters—were not clear about just why they were not reaching beyond Canada, citing a variety of perceived barriers including cost, competition, regulations, staffing and marketing. A third of respondents admitted to being “just not interested.”
“The ones who aren’t [doing business abroad] are just guessing,” opines Paul Beamish, Canada Research Chair in International Business at the Richard Ivey School of Business at the University of Western Ontario, who participated in a round-table discussion of the survey results on May 20. Just five per cent cited foreign-exchange fluctuations as a risk inherent in operating outside Canada, he notes, yet among the 500 companies engaged with foreign customers and suppliers, this was the largest single concern, mentioned by more than a third of respondents. Other real obstacles faced by the more globally oriented firms included the cost of operating internationally, local competition, staffing, local politics and market conditions, and marketing to unfamiliar customers.
The most common way companies conducted business abroad was through foreign partners, at 37 per cent, followed by their own boots on the ground, at 35 per cent. Nearly one in five had no foreign offices or partners, instead serving their customers and dealing with suppliers from Canada, a model made increasingly feasible by the Internet.
Many respondents expressed dismay at the difficulty of obtaining reliable regulatory and market information. Noted one: “Getting a straight answer on what duties and brokerage will apply on shipments is almost impossible to obtain. Even to the United States it is difficult. It would be great if all of these free trade agreements actually resulted in freer trade.”
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