The dynamics of international trade are constantly changing — so should your global business strategy if you want to keep up.
When it comes to international trade, change is the key to progress. Supply chain disruptions, rapid technological advances, and shifting geopolitical relationships have recently shaken up operations around the world, forcing organizations to find ways to adapt to new environments and market demands. While many industry leaders understand the value of remaining agile, most are finding it difficult to develop and enforce an international business strategy that works. For example, according to research from SAS, 97% of global executives view resiliency as a business priority, yet 46% admit their organization isn’t prepared for potential disruptions.
Understandably, many organizations find it hard to embrace change — it can be costly, take time to implement, and reliable legacy systems may make it hard to take the leap into novel territory. But if you don’t align your company’s goals with current market trends and consumer demands, you risk losing your competitive edge.
As the global business landscape continues to undergo a significant transformation, organizations have to stay innovative, flexible, and proactive to thrive. In this article, we’ll cover current trends and challenges of international trade, what your organization can do to prepare for these shifts, and how SEI can help you implement effective solutions to help you navigate economic uncertainty and remain resilient in the face of change.
Trends and Challenges of International Trade
As international trade continues to evolve, staying informed about the latest trends and challenges will help you navigate potential roadblocks and capitalize on emerging opportunities. Here are five market trends to consider when developing a robust international business strategy:
1 – Local Labor Arbitrage and Nearshoring are Becoming Common Practice
As the pandemic has taught us, nothing is set in stone. In response to market shifts, businesses are looking to expand their global connections to minimize the risk of loss in case of supply shortages, economic instability, or disruptions in partnering countries. Nearshoring — the practice of moving operations from a distant country to one that’s closer — is gaining momentum as businesses seek ways to cut transportation costs and ensure a more steady stream of goods and services. Organizations are also sourcing materials and labor from domestic companies to minimize the impact of potential supply chain disruptions.
How SEI Can Help
SEI can guide your business through these transitions by providing expertise in supply chain data strategy, helping optimize decision-making through real-time data analysis. Our consultants can help you develop comprehensive and customized strategies that generate top-down buy-in, enabling you to streamline your organization’s supply chain operations for maximum efficiency — even in the midst of change.
2 – New Trade Partnerships are Emerging
As political dynamics evolve, businesses may need to reassess their supply chain networks and identify new trade partners that best fit their goals. With China and India expected to experience considerable growth in 2023, some European countries are moving to forge ties with these potential economic drivers to help support their benchmarks. Limiting supply chain networks to a few partners who may not be faring well financially restricts your business from achieving its full potential.
How SEI Can Help
SEI’s advanced analytics capabilities enable companies to gain insights into potential risks and opportunities associated with geopolitical changes. Moreover, our expertise with solution delivery can help you reconfigure supply chain operations to align with your new trade landscape, ensuring continued smooth operations and optimal performance.
3 – Ethical Trade is Becoming a Priority
European governments are paving the way for a more ethical supply chain ecosystem through a variety of Environmental, Social, and Governance (ESG) regulations. These new rules require organizations engaging with European companies to conduct business that’s environmentally-conscious and socially responsible. As a result, companies need to reevaluate how they conduct transactions with certain stakeholders to ensure compliance and preserve current business relationships.
How SEI Can Help
Using in-depth analytics and predictive modeling to drive informed decisions, SEI can evaluate your current supply chain relationships to locate pain points and forecast potential repercussions to your business. From there, we can help you craft a step-by-step plan to adjust your operations to meet new expectations without slowing down your business.
4 – Supply Chain Digitization Continues to Unfold
AI is at the top of everyone’s minds, particularly among businesses figuring out how this technology can be integrated to drive efficiency in our growing digital economy. Governments and organizations have already begun automating their internal work structure to keep up with the demands of the global market, boost visibility, and better facilitate collaboration across the supply chain. And with the ever-evolving international landscape poised to keep businesses on their toes, companies will need to continue to digitize operations for the foreseeable future.
How SEI Can Help
Agile transformation, cloud strategies, application development — SEI can help upgrade your business with the technology it needs to level up. With extensive experience in technology enablement, we help you implement solutions that replace outdated systems, align with your internal work structure, and can integrate with emerging technologies like AI.
5 – Global Growth is Slowing Down — For Now
According to the International Monetary Fund (IMF), the global growth rate is projected to decline from 2.7% to 1.3% in 2023 due to ongoing inflation and the Russia-Ukraine war. On the bright side, banks have made progress in their efforts to reduce inflated costs, but companies are still finding areas to cut spending to maintain profit. While this presents a challenge for businesses, it also offers an opportunity to rebound in 2024 and beyond.
How SEI Can Help
SEI understands that success comes from long-term value, not momentary spikes in revenue and growth. With a specialized focus on process improvement, SEI can identify inefficiencies in your current strategy to develop an actionable framework to propel you forward. SEI can work with your organization to gain valuable insights into market trends, consumer behavior, and demand patterns in order to overcome growth constraints and achieve sustainable expansion.
Make Resilience a Reality with SEI
In today’s rapidly changing global market, businesses must adapt and embrace creative solutions to remain competitive. From nearshoring and geopolitical shifts to ethical trade and supply chain digitization, current trends in international trade present both challenges and opportunities, and SEI provides a range of solutions to help businesses navigate these trends successfully. Whether you need to revitalize your workstream with new technology, get back to the drawing board to redesign your operational processes, or both, we’re ready to help you achieve ultimate supply chain resilience.
