A Letter to Mark Zuckerberg and Ta-Nehesi Coates

For me, the issue of international trade cannot be separated from the question of how we can collectively fulfill our innate human potential. That is why I have been a passionate supporter of the TPP from the start.  It certainly is not perfect, and economic development and growth is a painful process (just like any process of deep change). However, I stand firm in my belief that the TPP is needed to help accelerate the pace with which all countries move through the four stages of economic evolution.   As developing economies evolve from agricultural-, to manufacturing-, to service-, to knowledge-based (and then, I might further propose, wisdom-based), they necessarily develop more efficient means of production, higher wages, higher education levels, and a higher standard of living, which means less pollution, less violence, more innovation, and a better quality of life for us all. 

Supporting each other through this process of evolution is critical. It requires developing in ourselves deep empathy and compassion for those who are behind us on the economic development ladder, and reaching out to lend them a practical hand up, which is what the TPP is intended to do.  It also means not knocking down or being fearful of those who are ahead of us.  If we all move forward in a calm, peaceful and orderly fashion, we can all arrive to a place where we are each rich -- rich enough financially to meet our basic needs and deeply wealthy in our friendships, human connections, life purpose, and contribution to the beautiful world that is both our birthright and responsibility to protect.

To help make this point and in light of Mark Zuckerberg's recent announcement to dedicate $45 Billion to advancing equality and human potential (framed as a letter to his newborn daughter), and in light of Ta-Nehesi Coate's award-winning memoir Between the World and Me outlining with ruthless honesty the damage done by decades of entrenched and systemic oppression (framed as a letter to his 12-year old son), I have written a letter to both Mark and Ta-Nehisi. 

I hope you'll read it here. 

I would love to hear your thoughts so please feel free to share widely and encourage anyone to send me their feedback.  I am continuously updating the article as I hear back so that it may speak for and to as many people as possible.  Feedback is also great fodder for pushing our collective thinking deeper and farther. Thank you!

TPP Negotiations Conclude

On Monday, Trade Ministers of Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States, and Vietnam announced that they have successfully concluded negotiations on the Trans-Pacific Partnership (TPP).

 

US Trade Representative's Office launched a new website Monday outlining what's in the TPP.  You can also read fact sheets on what's included here.  Benefits to small businesses will include: 

  • Eliminating tariffs, which can price out of foreign markets many of the goods and agricultural products made by U.S. small businesses.
  • Making it cheaper, easier, and faster for businesses to get their products to market by creating efficient and transparent customs procedures that help move goods quickly through borders.
  • Promoting digital trade and e-commerce by prohibiting tariffs on digital products (such as software, music, video, e-books) and helping keep the Internet free by protecting against requirements that force businesses to locate infrastructure in the markets in which they seek to operate, requirements that can be especially costly for small businesses with fewer resources.
  • Strengthening protections of intellectual property rights. 
  • Helping small businesses to integrate into global supply chains, as many small businesses don’t export directly, but sell their goods to other domestic companies that do.
  • Requiring TPP countries to create public websites targeted at small and medium-sized businesses that provide easily-accessible information on the agreement and how to take advantage of it.
  • Establishing a Small Business Committee that meets regularly to review how small businesses are taking advantage of TPP and discusses recommendations for making the agreement work better for small businesses.

This is a long-term win for U.S. small businesses. I'm especially thrilled that customs procedures will be streamlined - an antiquated fill-forms-out-in-triplicate style system that makes exporting painful for small e-commerce businesses. Hopefully TPP will also help bring prosperity to our trading partners since economic security brings the freedom and ability to contribute to the common good.

UK customs added 43% to one customer's checkout price

At Hello!Lucky, we strive to help our customers connect to their "happy place." Unfortunately, high customs charges recently got in the way. Read on for a real customer story.

Two weeks ago, Hello!Lucky shipped a $61 greeting card order to a customer in London. Normally, we would have shipped this from our U.K. office (to our knowledge, we're the only small U.S. greeting card business that has an office in London), but for reasons that are too boring to explain, this particular order got shipped from the U.S.

We received an email from the customer 10 days after her order had shipped; nothing had arrived yet. As any responsive company would, we immediately fulfilled her order again from our U.K. office at no additional cost and gave her a discount towards a future purchase.

The next day, we received the following email from the customer:

Dear Sabrina,
I was afraid this would happen...today I got a note from the Royal Mail after all. They weren't able to deliver the package today because a customs charge needs to be paid (GBP16,87).
What should I do? Should I return one of the packages once I get both? Or not pick up this one?
I do think the charge is a bit much by the way, and I was not expecting the cards to be shipped  from the US, since I saw on your website that there is a 'Hello Luck UK' contact as well...
Well please let me know what's best to do.

We instructed her to not pick up the order; it would thus be returned to us.

So we ask you:

  •  Is $26.48 in customs fees and duties reasonable for a $61 greeting card order? That is a 43% premium on the purchase price.

  • Can small businesses really be expected to do business internationally if they face duties like these?

  • Is having packages returned to sender due to the unexpectedly high customs and duties a good use of taxpayer dollars?

TPP passed last week and will enable the President to negotiate trade agreements that will hopefully raise de minimis customs exemptions and/or harmonize and lower duties to avoid situations like this one.  If you agree that you want to be able to ship and shop internationally with ease, let your local representative know!

Here's to everyone being able to find their happy place!

 

 

 

 

 

Asserting Kindness

The president deserves our support on his trade agenda. Here's why.

Maybe it’s just my shameless faith in the power of love (yes, I grew up in the 80's listening to Huey Lewis), but recently the solution to all my problems seems to be kindness. Not just as an abstract ideal, but as an active choice.

Kindness is a de facto meme in scientific research and popular culture— from “random acts of kindness” to the Dalai Lama’s Center for Compassion and Altruisim Research and Education at Stanford Medical School.

Dacher Keltner of U.C. Berkeley’s Greater Good Science Center, argue that a growing body of scientific research shows that human evolution is wired to reward acts of kindness.

In his critically acclaimed The Short and Tragic Life of Robert Peace, Jeff Hobbs traces the life of an African American boy from Newark who receives a full scholarship to Yale, only to succumb to the drug trade and addiction. A key thread is importance of compassion — and its alternately stark and subtle absence in our criminal justice system, our neighborhoods, andour elite schools.

In the New York Times best-selling youth novel Wonder, by R.J. Palaccio, a boy with a dramatic cranio-facial anomaly teaches an entire community about kindness through his example. Palaccio, quoting Christoper Nolan, cites kindness in reverential tones:

“It was at moments such as these that Joseph recognized the face of God in human form. It glimmered in their kindness to him, it glowed in their keenness, it hinted in their caring, indeed it caressed in their gaze.”

Maybe it's because of my belief in the power of kindness, then, that I am saddened by decidedly unkind rhetoric in our nation’s political debates, such as the current attacks on President Obama’s trade agenda.

I feel compassion for our President. Leadership is lonely. It sucks sometimes. And for what it’s worth, I am so looking forward to seeing what he will do post-presidency, when he can freely leverage his passion, talent, and influence to help Americans, starting with supporting men like Robert Peace as he is doing with his My Brother’s Keeper program.

In the meantime, he deserves our support for his remaining priorities, and faith in his process.

As I see it, the main criticisms of trade promotion authority (TPA) and the Trans-Pacific Partnership (TPP), the landmark trade agreement with 11 Pacific countries excluding China, come down to two concerns: 1) income inequality and 2) corporate power.

Continue reading here


Towards an entrepreneurial middle class

When my sister and I started our stationery company, Hello!Lucky, in 2003, we did it out of her leaky garage with a vintage press from eBay. With the collapse of the 2000 web bubble, she had lost her corporate web design job, where she’d worked on websites like Webvan and Pets.com. She took a job at a high-end pet boutique for the discounted dog food. When the owner complained she couldn’t find good dog and cat-themed greeting cards, my sister designed some. She sent samples to Kate’s Paperie in New York City, which placed a $1500 order.

We decided to start a business. We exhibited just eight cards at the National Stationery Show and landed a few accounts. I used my corporate paycheck to fund our start-up expenses and hire our first employee, my sister’s housekeeper. Our second employee was an old room mate working at Walmart under the pseudonym of Otto. Three years later, we decided to open an office in London. Our strategy for global expansion: a friend sold our cards to boutiques door-to-door out of a roller bag suitcase. It was true a bootstrapping operation.

Setting up our booth for the 2014 National Stationery Show

Immigrants and entrepreneurialism

The kind of resourcefulness and work ethic my sister and I exhibited is often associated with immigrants. It’s no coincidence. As the daughter of a U.S. Foreign Service Officer, our family “immigrated” to the U.S. when I was 15. Before that, we lived in Taiwan, China, and Malaysia — countries that were abuzz with entrepreneurial activity.

My first job at age 13 was at a Vietnamese refugee camp, where I saw families crowded into makeshift tents living off bare rations. Chun Yee Yip, who started our London office, grew up in a one-room tenement house in New York City’s Chinatown, the daughter of two immigrants from Hong Kong who owned a laundromat and saved enough money to send her to Barnard College. There was no space to do homework in the apartment so Yip grew up at the Chinatown YMCA.

Continue reading here

 

Small headaches a big barrier to micro-businesses in international trade

Last month, Hello!Lucky and Egg Press concluded our second annual Write_On campaign to challenge ourselves, our friends, and our fans to write 30 letters in 30 days to bolster authentic connections. The campaign was a resounding success, with all 5,000 of the free "starter" kits (letterpress cards and a Sakura pen) spoken for within days of announcing the campaign.

About 60 of those kits were requested by international customers, and while we were thrilled to see our campaign going global, shipping the kits out proved to be a nightmare.

Why? It all boiled down to customs and duties and a lack of standardization.  We had to fill out customs declarations for each package individually -- Stamps.com offered no way to copy and paste content, or to bulk ship a package with the same contents to multiple international destinations.  The project took a full-time employee three days to complete. For a small business, that's a major investment in time and resources.

Now, imagine a small business seeking to grow overseas. Let's say the company runs a sale for customers in, say, Indonesia, that results in a good number of orders. The labor and cost of shipping is enough to erode profit margins or even turn them negative. Not to mention the negative fallout when packages get stuck at the border

Start-ups like Shyp are trying to take the pain out of small business shipping. However, even they throw their hands up when it comes to customs and duties, putting the onus on the shipper to fill out all the forms, and deal with the consequences at customs.  Here's what they say:

International
Shyp can send items anywhere in the world where traditional carriers operate. 
 Customs Declaration Forms
International shipments require a Customs Declaration Form, which itemizes contents and value. Customs Declaration entry is built into the app, so Shyp can include all necessary documents with your shipment.
 To assist in smooth Customs processing, accurate entry of all contents and value in its entirety is required. After entering an international address and snapping a photo,  ‘Item Information’ entry is displayed. Add an item description, unit value and quantity of items.
 International shipments are subject to inspection by Customs in the receiving country and will reference the itemized Declaration Form. Shyp reserves the right to inspect any item, and any packaging may be subject to opening by our packing technicians to ensure full compliance with carrier and postal guidelines and to be validated for description and value for customs.
Duties & Taxes
All Shipments are subject to assessment of duties and taxes set forth by the importing country’s government. The duties and taxes are assessed based on the information provided in the Customs forms and the amount can be determined by Trade Agreements, Country of Manufacture, Use of the product, or Product Value.  Items are typically held and released only after the amount is paid.  Please keep in mind, gifts and personal effects are not exempt from duties and taxes.
 All international shipments sent with Shyp require the recipient to pay duties upon delivery in the destination country and may not be released until paid in full. If an international package is returned to Shyp because the shipment was ‘Refused’ or ‘Unclaimed,’  the user may be subject to additional shipping charges incurred for the return shipment. 
Please email help@shyp.com if you need to prepay for duties.
International Tracking & Delivery
The lowest cost, default international shipping option does not include insurance, delivery guarantee or tracking. To upgrade to a service class that includes insurance, delivery guarantee, and tracking, simply upgrade via shipping options in the app.
 Carriers cannot account for delays or processing through Customs which can affect the delivery date.

 

Sound simple?  It's not. But it could be. Small and micro-businesses need trade agreements that harmonize customs and duties and lift and standardize de minimis customs thresholds.  We also need killer apps to make it affordable and painless to ship small packages of goods overseas.  

Any takers?

 

 

Predicting the effects of international trade

Trade agreements have been a hot topic lately and when they come up in conversation, I hear a lot of good questions. What will increased trade do to jobs here and overseas? Will increasing imports fuel consumer culture? Will the increase in international transport harm the environment? The lack of certainty around these questions underlies a lot of the controversy around the Trans-Pacific Partnership (TPP), President Obama’s landmark trade agreement.

To make sense of arguments, I decided to look at the issues side-by-side. While it’s impossible to predict the exact effects, we can get a directional idea of the potential outcomes:

As one might expect, international trade has both positive (green) and negative (red) potential effects.

Continue reading here.

 

 

Obama's remarks at Nike focus on small businesses

President Obama's remarks at Nike on Friday did a great job of outlining how and why trade agreements benefit small businesses, individual works, and consumers.  The speech is well worth watching for a better understanding of the big picture of how trade agreements affect individuals both in the U.S. and abroad, and the overall economy.

President Obama acknowledges that past agreements have resulted in job loss in part due to the massive move towards outsourcing in the last two decades. But times have changed. The companies that are competing on cost have already moved manufacturing overseas and don't need new incentives to do so. The companies that are competing on quality -- advanced and high-end manufacturing is where the U.S. has a competitive advantage in global manufacturing (see Tesla) -- need trade agreements to cement access to growing Asian markets. In addition, these manufacturers are already moving towards bringing jobs back to the U.S. ("in-sourcing") to better protect intellectual property, quality, and reduce shipping costs and environmental impacts.

And kudos to Hello!Lucky's partner Egg Press for their shout-out in the speech and on The White House blog. President Obama gets the importance of small and micro-businesses, and creative entrepreneurs in creating high quality products, meaningful jobs that merge career with calling, and promoting conscious consumption of products that reflect creativity, quality, joy, environmental responsibility, and more. How awesome is that?

 

 

7 ways the world has changed since NAFTA

Growing up in Asia in the 1980s, the daughter of a U.S. foreign service officer, everyone I met wanted a U.S. visa. I could relate. The U.S. meant opportunity, creativity, and freedom. As a result, we coveted American products. You could literally taste the American Dream in a McDonald’s Big Mac. And while I loved China and Taiwan, where my mother is from, I couldn’t wait to get my hands on American goods (Madonna cassettes, neon jelly bracelets, paint splatter leggings — it was the 80’s after all).

In 2003, my sister and I started Hello!Lucky, a business that makes high-quality, hand-crafted letterpress greeting cards. In the last 12 years, we’ve done more than $10M in cumulative sales, opened an office in London, and begun exporting. With Egg Press, our business partner, we employ 26 people and are growing 60% year-over-year.

“NAFTA on steroids.” That’s been the rallying cry of critics of Trans-Pacific Partnership (TPP), the trade agreement being debated by Congress. TPP would cut or eliminate tariffs and quotas and set high labor and environmental and labor standards across the twelve countries around the Pacific. Critics claim it will destroy U.S. jobs by opening high-wage U.S. workers to low-wage foreign competition. They say NAFTA, which removed similar barriers in North America, look like “child’s play.”

Free trade is getting flamed. And why? Because of a trade agreement that happened in 1994, when a smart phone looked like brick.

IBM Simon Personal Communicator, the smart phone of 1994, via Global Grind

IBM Simon Personal Communicator, the smart phone of 1994, via Global Grind

Continue reading here.

State dinner showcases Obama's support for women, small business & local manufacturing

I had the incredible honor of being a guest at the state dinner in honor of Prime Minister Abe on Tuesday. As a small business owner who manufactures locally and exports internationally, I know first-hand the incredible opportunities that TPP (Trans-Pacific Partnership) could help unleash (read about our partner Egg Press's recent trade mission to Japan for just one example!).

As a sat in under the crystal chandeliers of the White House under the gaze of a portrait of George Washington, I deeply felt not only the incredible opportunities that global trade offers to U.S. manufacturers and small businesses, but also the transformative power of global commerce to remove barriers of perception that segregate people worldwide and often escalate to violent conflict.

Goods, services, and brands provide a common ground around which people can connect and relate to each other.  When I was growing up in Taiwan and China in the 1980s, the McDonald's brand literally represented the U.S. constitutional values of life, liberty, and the pursuit of happiness (per the “happy meal"); people flocked there to get a “taste,” literally and figuratively, of the American good life. Today, Apple hold a similar power to confer feelings of joy to its customers.  That's because, U.S.-made and -designed products represent our values -- creativity, quality, freedom, to name a few -- and will increasingly be in demand as the Asian middle class booms and their tastes mature.

My seat at the table, directly across from Mrs. Obama and Prime Minister Abe, was also a shout-out to the vital importance of small businesses and local manufacturing: making products that people love, giving people the opportunity to shop local, and creating jobs that people take pride in and that allow them to gain real experience in all aspects of running a business.  Dozens of Hello!Lucky’s (the company I founded in 2003 with my sister) past employees have used their experience as a stepping stone to coveted jobs at larger companies such as Paperless Post or Williams-Sonoma, leading business schools (Kellogg and Cornell), and to starting businesses themselves.

As small business owners, we often feel the pressure of “not enough." When I graduated from Stanford Business School in 2002, for example, everyone left to join a tech start-up that might become the next Facebook, or a venture capital firm, or a consulting firm or investment bank. No one left to start a small business.  It conferred low pay and low status.  Likewise, as a small business owner, there are not enough resources, and not enough time in every day. The threat of failure looms large, the need to scale to cover overhead costs is pressing.  

Obama's invitation was a wholehearted gesture to small business owners that we are enough -- that our effort deserves to be respected and applauded, even if we are not creating billion dollar market caps or six-figure paychecks.  As many small business owners know, true joy comes from within and expresses itself in meaningful work, strong relationships, and embracing business and life as a creative endeavor.

Finally, I felt deeply honored to be present as a woman business owner. As I discussed briefly with Mrs. Obama over dinner, women still face many challenges in the workforce, starting with the lack of guaranteed paid maternity leave.  However, small businesses offer incredible entrepreneurial opportunities for women, from setting their own schedules and timeline and creating a family-friendly work culture, to creating new products and services and having control over hiring and firing decisions. The only ceiling in woman-owned small business is in how much she can earn — and that is decided by her business model and her market, which discriminate on price and quality, not on gender.  

So thank you, President Obama and Prime Minister Abe, for your wholehearted support of women, small business, and local manufacturing.  We are so very grateful!

The Promise of Japan for Creative Businesses

The time is ripe for small, artisanal creative businesses to enter Japanese market.

Last week, Egg Press, Hello!Lucky’s partner in Portland, Oregon, visited Tokyo for a week-long trade mission called Pop Up Portland, hosted by the Portland Development Commission (PDC).  

The trip included a pop-up shop featuring Portland-based creative businesses ranging from Keen footwear to high-end apparel brands Archival and Older Brother to hand-crafted bicycle accessories by PDW Design Works. The shop, in Tokyo’s hip Akibahara “electric town” district, allowed Japanese media, retail, and wholesaler buyers experience Portland-based craft brands.  

In addition, PDC set up meetings with Japanese retailers, helping these small business owners develop personal relationships with buyers.  Unlike a trade show, where a small business can easily get lost in the mix, participants received one-on-one attention and support for Japanese translators and facilitators.

According to Egg Press owner Tess Darrow, the trip was a huge success and will likely result in new orders for Egg Press and Hello!Lucky’s letterpress greeting cards from Japanese retailers such as Loft (a large general goods concept store chain similar to Target) and overall growth in Japanese sales.

Pop Up Portland delegates with singer Saori Yuki.

Combined with Prime Minister Shinzo Abe’s historic visit to the U.S. this week, the mission highlighted the exciting opportunity that Japan presents for small- and micro- creative businesses.

Two factors create this opportunity. The first is the Japanese customer. The second is Prime Minister Abe’s economic reforms, which look likely to unleash an unprecedented period of economic prosperity translating into demand for high quality, hand-crafted products.

The Japanese customer: a high regard for quality

According to Mitsuhiro Yamazaki, the Portland Development Commission executive who organized Pop Up Portland, Japanese customers crave high-quality, hand-crafted products. “In choosing to focus our mission on craft brands, we simply followed customer demand. We looked at media coverage in Japanese magazines. There is a great appreciation for hand-crafted, high-end products and the Portland aesthetic is well thought-of.” (One only has to view the TV series Portlandia to understand this aesthetic: organic, hipster, mid-century, minimal, and Americana — and to some extent itself inspired by Japanese design). 

Archival Clothing messenger bag

“The Japanese market is more mature than the Chinese market, where people want more, cheaper, faster — kind of like Japan in the 70’s. Now, growth has slowed and customers appreciate quality over quantity,” said Yamazaki. As a result, Japanese customers are showing an appetite for high-end crafted products and brands. “It’s the right time for quality brands that fit into the context to scale up their presence in Japan.”

The Japanese market: now is the right time to export

Thanks to Mr. Abe’s economic reforms (most notably printing money and setting an optimistic inflation target of 2%) Japan could be poised to once again become a major economic force in Asia — and a significant consumer of high quality imported goods. 

Here’s why:

If TPP (Trans-Pacific Partnership) passes, the Japanese market will open substantially to U.S. agricultural exports. While this has direct benefits to the U.S. agricultural industry, it could also benefit other exporters by freeing up a portion of the consumer’s budget that would normally have been spent on food.

Oil prices are at an all-time low, which is translating into record profits for Japanese companies.  Japan, which historically relies on importing raw materials, manufacturing, and then exporting has seen a major increase in corporate profits due to the lower cost of inputs.  These increased profits are helping to create economic growth that could in turn stimulate demand for imports.

Japanese workers are more productive than most, and their wages have been steadily declining due a rise in part-time jobs, making Japanese manufacturing once again competitive with the rest of Asia. Many leading Japanese manufacturers, including Sharp, Toshiba, and others, have moved manufacturing back to Japan. This will create more job growth in Japan which could translate into economic growth and demand for imports.

Mr. Abe is also proactively trying to get women back to work. Women have historically played a minor role in the Japanese workforce, and with high unemployment and the ongoing recession in Japan there has been little incentive for them to do so.  With a growing economy and governmental encouragement (Mrs. Abe is owns an organic izakaya restaurant), women could have more opportunities to get back into the work force and have more purchasing power.

How does a U.S. small business access the Japanese market?

Accessing the Japanese market — or any foreign market — takes research and relationships on the ground. PDC’s Pop Up Portland mission is unique, but the model could be replicated by other cities and in other markets with thoughtful research and careful planning.

“It’s all about personal connections,” said Yamazaki.  To set up PDC’s first green building trade mission in 2013, he spent “many months” reaching out to Japanese real estate developers and local government officials.

According to Yamazaki, the U.S. government’s approach to trade and small businesses is out of date. When he initially approached the U.S. embassy in Tokyo, he found that staffers were generalists who lacked the industry-specific, on-the-ground knowledge or connections needed to develop new business relationships.   Trade brokers, on the other hand, often lacked big-picture strategy and economic development in general. “You need to be able to sell, market, communicate, and convince.” said Yamazaki, a Japanese national who came to the U.S. for college and has a background is in business and economic development. “That’s what it takes to be successful.”

It also takes U.S. small business owners thinking big-picture and long-term.  “For Pop Up Portland, we approached more than 30 companies to get 7 - 8 businesses to participate,” lamented Yamazaki.  Small business owners are simply too overwhelmed to take the time to travel overseas with uncertain outcomes. They should put aside their fears and seize the opportunity. With Asia’s ascendence as as dominant economic force, small business owners need to follow President Obama’s lead and “pivot towards Asia.”

U.S. small businesses can show their support for Prime Minister Abe’s economic reforms, which directly benefit businesses seeking to access the Japanese market, by supporting TPA and TPP.

 Write to your congressperson about the importance of trade

Sign our petition

Make and share a Share Trade selfie or export badge

Reasons to love Australia: Nicole Kidman, Koalas, and their De Minimis Customs Exemption

There are myriad reasons to love Australia. Ugg boots (e.g. "the winter flip flop").  Nicole Kidman, whose resolve and resilience is highlighted in HBO's new documentary on Scientology, Going Clear.  The Great Barrier Reef.  Mad Max (oh yes, we do need another hero!).  And, of course, this adorable creature:

But what I really love about Australia is their high de minimis customs exemption. 

"De minimus wha?"

I'm so delighted you asked.

De minimis customs exemptions are the value under which imported goods are not subject to customs or duties. For example, the U.S. de minimis customs exemption is currently $200, which means any item shipped into the U.S. under $200 isn’t subject to customs or duties.

Some countries have high de minimis exemptions, like Australia (~$1000), while others like Canada and the United Kingdom have very low ones (~$20).  For a small businesses, that means it’s much easier to export to Australia than Canada or the U.K.  As an Australian customer, it means you don't worry about your online order getting stuck at customs, whereas in my experience as U.S. exporter, Canadian customers have a form of postal PTSD from paying duties  on orders from friendly people right across the border.

So that's why I love Australia.  Hello!Lucky, the letterpress card company I own with my sister, has a loyal fan base of Aussies who appreciate our aesthetic and silly sense of humor (which makes sense given this is the culture that brought us the cork hat and Dame Edna).  We ship to Australia often, and it's blissfully simple.

So need to change to make e-commerce easier for small businesses and customers globally? We need countries to increase and harmonize their de minimis thresholds (e.g. make them consistent and high), eliminating many of the challenges small businesses face shipping goods across borders.   

Trade agreements offer a great opportunity to do this. Congress is debating several bills related to trade, including something called Trade Promotion Authority, or TPA, which authorizes the Obama Administration to negotiate trade agreements, and the Trade Facilitation and Trade Enforcement Act, which takes steps to reduce bureaucracy at the US border, setting a strong example for our trading partners.

So support trade, mate!  Sharing is caring!

Why the Universal Postal Union is hurting small businesses

The amount you pay for international shipping rates via your national postal service is regulated by an entity called the Universal Postal Union (UPU), which will meet in 2016 to set its new long-term strategy.  According to Fortune Magazine, national governments aren't paying attention.  But small makers need parity in shipping rates to compete in the global marketplace.  Due to UPU subsidies, it can cost $30 more to ship a 1 lb package from the U.S. overseas than it costs a business overseas to ship the same package to the U.S., and other developed countries face a similar imbalance. That's a big deal when you're shipping small packages to international customers. We did a little research on international shipping costs to learn more.

China has been the biggest beneficiary of UPU subsidies, and its impact on U.S. internet sellers was the focus of this Washington Post article.

Malaysia's national post appears to benefit from UPU subsidies to the tune of about $29, but commercial shipper Fedex's rates have parity, more or less, in both directions.

Japanese shippers appear to benefit from UPU to the tune of $31. But, oddly, commercial carrier Fedex seems to charge Japanese shippers more than U.S. shippers to send the same package to the U.S. and Japan, respectively.

Australian and U.S. shippers enjoy parity, more or less, with Aussies holding a slight advantage.

Singapore shippers using national post enjoy a $20 subsidy; however, Fedex rates are more or less on par.

Conclusion:

Shipping rate parity is far from a reality.  UPU reform is needed to level the playing field for small businesses globally. While it's wonderful for developed countries to help developing countries grow their economies through exports, the reality of UPU doesn't make sense. Developing countries like China that receive UPU subsidies are net exporters and economic powerhouses. In the meantime, small businesses in developed countries like the U.S. are unable to compete in the global marketplace because of high shipping costs, and they even pay the price in higher domestic shipping costs, which may be raised to subsidize the growing volume of small shipments coming from overseas.  Developing countries should be competing fairly based on a value proposition that includes unique products and lower labor costs, not on subsidized shipping.

Interview with Sarah Payne, Business Mananger, Hello Lucky Europe LTD

Hello!Lucky's UK office is not just surviving but thriving thanks to Business Manager Sarah Payne. We share some history on how Hello!Lucky opened its UK office back in 2005, and the challenges and opportunities it faces today, from high demand for our quirky products to exchange rates, VAT, and shipping costs.  

In the stationery world, Hello!Lucky is one of the only companies we know of that has successfully set up operations overseas.  How did we do it?  

Creativity and commitment. First, creativity: an entrepreneurial friend moved to London and offered to set up operations in her flat. She converted her guest bedroom into a "warehouse" using Ikea shelving.  She didn't demand a salary or rent since her husband worked in finance; plus, she was thrilled to be gaining experience in starting up a company overseas. Then, commitment: she went door-to-door to small shops hawking samples out of a roller bag. She found an accountant and labored through the year-long process of registering our company and opening a bank account (a remarkably byzantine yet laudably secure process). 

After three years, we were selling to Liberty of London and Selfridges and many other leading boutiques. After about five years, we had enough revenue to start paying an employee and, occasionally, sending a little cash back to the US office (woot!).  Today, UK office is still just covering its costs, but we see our presence in the Europe as a crucial investment to continuing to grow our brand internationally.

Success and growth has come at a price. Before exiting the custom wedding invitation business in 2013, our UK revenue was high enough (over £82,000) that we had to register for and charge VAT, an administrative headache for a small business that, at 20%, also made the price point of our already-high-end products even higher. Last year, we were able to deregister for VAT, which has brought our costs and customer prices down. But, VAT looms on the horizon as a potential threat to our competitiveness as our exports grow.  Increasing the VAT registration threshold is something that small businesses should advocate for in future EU trade agreements.

Since 2013, our UK office has been run by Sarah Payne, our UK Business Manager and a passionate advocate for the Hello!Lucky brand.  We asked her to share her insight into opportunities and challenges faced by Hello!Lucky's UK and EU business today. 

ST: What do you do for Hello!Lucky in the UK and EU?
SP:  I liaise with customers, collate, process and dispatch purchase orders. I control our stock of greeting cards including producing purchase orders.  I also maintain our company accounts, raising invoices, paying invoices and keeping appropriate records. The last part of my role is about publicity - ensuring our customers are aware of new designs and producing and sending out line sheets with any offers we may have.

ST:  What type of customers buy Hello!Lucky cards in the UK and EU?
SP:  Our customers cover quite a broad spectrum.  In the UK we have one major customer who is a large national bookshop with stores throughout the country. We also have a number of 'lifestyle' shops and other smaller retailers such as bookshops, florists and the like in addition to independent greeting card shops. In Europe again, we sell to a variety of independent shops such as bookshops, lifestyle shops and greeting card shops. In addition we sell directly to the public who contact us because they've seen our cards and wish to buy them but don't have a local retailer.

ST:  Why do UK and EU buyers want Hello!Lucky cards?
SP: Our buyers like our cards as they appreciate the quality of our cards and the fact that our designs are very different to other manufacturers. The quirky nature of the designs is something that is often commented upon. Our range does offer something for everyone though with cards to suit different tastes.

ST:  What are the biggest barriers you face selling Hello!Lucky cards in the UK and EU?
SP:  For us, price is a big issue. Our cards are hand printed on an antique press but this comes at a premium price. Some of our stores have set margins for the stock that they sell and with the cost of the cards, the high costs of the shipping, the high exchange rate at present and then our overheads in the UK, it can make our cards seem expensive compared with our competitors.  We have recently been able to deregister from VAT which has reduced our administrative overheads and benefitted some of our smaller customers and public who have bought direct. In the EU, again, price has been a issue as it's expensive to ship to Europe. Publicity is also a challenge to get to new markets.

ST:  If these barriers were removed, what do I think the impact would be on Hello!Lucky?
SP: We recently sent out a sales sheet for some cards and the response from our customers was excellent.  I therefore think that if there were more flexibility around price that would help increase our turnover and, possibly, necessitate additional help in the form of another employee at some point.

In conclusion:

Sarah's insights point to the love customers in the EU and UK have for unique, beautifully made products -- a call to small makers of all stripes to think proactively about their export future.  Her experiences also point to the challenges that we collectively face as small business makers; high shipping costs, administrative burdens of taxes and duties, exchange rate fluctuations, as well as marketing costs which are increasingly (we hope) being reduced by social media and global online marketplaces like Etsy.   Let's keep bringing those barriers down, and #Sharetrade!

 

White House Briefing on TPP & TPA

Last week, 45 small business owners met for a briefing at The White House on TPP and TPA. After in-depth discussions, they agreed that small business owners need to take action to show their support for TPP. 

Ambassador Michael Froman.jpg

Ambassador Michael Froman, who is responsible for the TPP negotiations made three key points:

  • TPP is anything but "fast." Congress will have a full month -- a long time in political world-- to review the agreement. 
  • Ambassador Froman is inviting input into the negotiations. A congressional committee regularly gets to review key pieces of the agreement.  The public is regularly invited to give input -- and Ambassador Froman is being proactive about inviting critics to voice their concerns, and is responding to those concerns in an ethical and balanced way.
  • TPA is essential to getting multilateral negotiations done, and has been granted to every past president regardless of political party.  It would be impossible to negotiate a multi-lateral agreement if our negotiating counterparts knew that Congress would be able to pick apart and change the agreement after the fact.

Catherine Novelli, Under Secretary of State for Economic Growth, Energy, and the Environment, stressed the importance of U.S. businesses having a level playing field in the global markets. Currently, the U.S. levies tariffs of just 1.9% on average for imports, whereas U.S. companies exporting to other countries pay much higher tariffs, sometimes in the 100's of percent.

U.S. businesses need to maintain their access to the growing Asian middle class, currently around 300 million and expected to reach 3 billion by 2030.  If we don't create a level playing field and take the lead in stewardship (e.g. environmental regulations), then China is likely to take the lead. Also, U.S. competitors are not slowing down to wait for the U.S. and have negotiated hundreds of one-off trade deals with each other already, that have the potential to further shut U.S. businesses out of their markets.

Secretary of Agriculture Tom Vilsack emphasized that the U.S. is in the fortunate position of producing more food than we consume. This not only allows more of us to obtain jobs in the knowledge and innovation economy (200 years ago, most of us would be spending our free time farming simply to keep food on the table), but creates valuable opportunities for small businesses to export food products.  Charles Chocolates, a Bay Area chocolatier, is one example of a branded food company that is seeing growth in exports. That said, Chuck Seigel, the company's founder, noted that they need help navigating the barriers to exports, from strict regulations governing food products, to temperature control exporting to equatorial Asian countries. 

Hello!Lucky co-founder and Share Trade founder Sabrina Moyle spoke to the fact that TPP and TPP are but one piece of the puzzle when reducing barriers to small businesses getting into the export game.   We also need lower shipping rates and increased transparency of information, including a "killer app" that makes it easy for small business to identify new overseas markets and navigate regulations and logistics; currently this data resides on multiple government and non-profit websites and is quickly outdated.  

Overall, the attendees all agreed about how hard it is to get small business owners organized. According to Secretary Vilsack, the typical member of congress gets 12,000 emails daily from people opposed to TPP, and only 2 from those who support it. That is because it's much harder to get passionate about something as complex as a trade agreement, and small business owners are simply to busy to engage. 

Everyone agreed that a simple social media campaign, such as the Small Business Export badge campaign, an idea generated during the briefings, would be a possible and highly visible way to mobilize small business owner support.   We hope you'll join us!

No Small Business Left Behind: Support TPP!

TPP will help small businesses survive and thrive in the exponentially growing global internet economy. Congress urgently needs to hear from small business owners.

Small businesses need access to exports to grow in the 21st century. 95% of the world's consumers are overseas. American manufacturing is already reviving due to rising demand for high quality, small batch, and artisan goods (e.g. Tesla cars).  The middle class in Asia is already 300 million and is expected to reach 3 billion by 2030. They will want access to these U.S.-made goods. 

President Obama is working hard on something called TPP,  or Trans-Pacific Partnership, a multi-lateral trade agreement with 11 Pacific Rim countries, that would lower tariffs, simplify regulations, and safeguard universal human values like environmental stewardship.

Tariffs for U.S. exporters are too high and there are many barriers, from high shipping costs to lack of data on how to enter foreign markets. These barriers are rapidly falling away, with TPP as the cornerstone.  Export help is available online, and this transparency will only grow.  The small business exports are set to explode as the entire world population of 7 Billion gets online by 2020, just 5 years away.

But right now well-organized interest groups are lobbying against TPP. They well-organized. Small businesses are not. If we let opponents have their way, small businesses and the American people will lose out, big time.

Opponents are focusing on specific, concrete, issues such as internet rights and access to medicine.  TPP, like any multi-lateral trade agreement, is complex. Imagine reaching consensus with 11 people, each with different agendas, cultures, and constituencies. It's daunting. It involves compromise. It will never be perfect.

The Obama Administration is taking critic's views seriously.  In their criticisms, cynicism, and fear, opponents are threatening to throw the baby out with the bathwater.  U.S. and small businesses, in particular, will be at a severe disadvantage in the global economy if TPP and TPA are not approved by Congress.  Our trading partners are not slowing down to wait for us. If we don't act now to secure our place, we will be left behind.

The Obama Administration is taking an ethical balanced approach and keeping small business needs front and center. They are doing their best, and they need our support.  The American people need this agreement, and they need small business owners to speak out.

The U.S. is already at a huge disadvantage in global competitiveness because of our antiquated education system. You have only to read Dr. Tony Wagner's The Global Achievement Gap: Why Even Our Best Schools Don't Teach the New Survival Skills our Children Need---and What We Can Do About it -- soon made into a feature-length documentary -- to understand the crisis in U.S. education.

Small businesses will be the drivers of the U.S. global internet-based economy. They are innovative. They are creative. They create good jobs -- jobs where you are treated well, known personally, and feel like an owner.  The next Steve Jobs is a small business owner.

Small business owners: as a small business owner myself, I know you're buried. I know you are the janitor, customer service rep, sales person, legal, HR, and more at your company. You feel like you don't have time to engage in a conversation about trade.

SMALL BUSINESSES, CONGRESS NEEDS TO HEAR YOUR VOICE.

TAKE ACTION NOW!

Sign the Petition

Get your Small Business Export Badge

Share your story

Learn more about TPP 

Email me at sabrina@hellolucky.com to be interviewed for this blog.  Every story counts. Act now to safeguard your access to export markets!

 

 

 

10 reasons why small business don’t care about TPP, and why they should

Many small business owners haven’t have heard of TPP, a landmark trade agreement that is currently being negotiated by The White House with 11 Asian countries.  Many don’t care.  But here’s why they should.

Photo by adrian825/iStock / Getty Images
Photo by adrian825/iStock / Getty Images

Top 10 Reasons Why Small Business Owners Don’t Care about TPP

1.     50% of small businesses fail after 4 years. Owners are focused on staying in business, which usually means focusing on local markets.

2.     Small business owners wear multiple hats: they are sales, marketing, customer service, management, accounting, shipping, janitorial, legal, HR, purchasing, and R&D. They’re too busy juggling all their responsibilities to pay attention to seemingly remove trade policies.

3.     TPP and trade discussions are often framed as being about creating jobs.  While small business owners care about their employees, they don’t go to work every morning to create jobs. They go to work because they are passionate about what they do and believe they are providing a valuable good, service, or experience that the world needs.

4.     Priority #1 for small business owners is their customers. Many have a small and customer base and have not yet established brand loyalty.  To grow or get to profitability if they are just starting out, they cannot afford to have even one unhappy customer, particularly in today’s social media savvy and reputation-focused world. 

5.     Priority #2 for small business owners is their employees. Many view their employees as family and try to take care of them by creating a personable work environment and offering competitive wages and benefits to the best of their ability. Employees of small businesses are not just replaceable cogs in the wheel as they might be in large corporations. They are each critical players who often are highly engaged in running the business alongside the owner. That said, many small business owners struggle to meet payroll every two weeks, since wages are usually their biggest fixed cost.

6.     As a result of #4 and #5, small business owners have a hard time engaging in seemly distant trade policy issues when urgent and personal issues presented by their customers and employees are facing them every day.

7.     The U.S. is a big market and a continental economy. It is easy to trade across state lines, so small businesses focus first on growing to U.S. markets, rather than looking at opportunities overseas.

8.     Small businesses face major logistical hurdles to exporting their goods and services:  high out-bound shipping costs, lack of knowledge about overseas duties and customs, high tariffs on their products, unknown or complicated regulations governing their products (particularly true in the food industry), and lack of an easy one-stop shop for understanding global demand for their particular product and the trade rules and regulations governing their products.  They don’t realize that TPP is a crucial part of the puzzle to reduce barriers to export – not only will it address tariffs and duties, but it will build momentum for knocking down barriers like high shipping costs and lack of market data.

9.  Those small businesses that have exported all have export horror stories. In Hello!Lucky’s case, one such story was a bride in Spain getting her time-sensitive, custom-designed, high-end letterpress wedding programs getting stuck in customs the day before her wedding.  She got them out just in time, the morning of her wedding, but it was not without a huge amount of stress for her and for Hello!Lucky. 

10.  Small business owners don’t realize that the future of their business is overseas.  95% of world consumers are outside of the U.S., and they want our goods. See below for more details about this historic, exponential opportunity for small businesses.
 

Top 10 Reasons Why Small Businesses Should Care about TPP

1.     The future of small businesses is overseas and will be driven by e-commerce.  95% of world consumers are outside of the U.S. There as a rapidly expanding middle class in Asia, where TPP is focused: currently there are about 300 million in the Asian middle class (equal to the total U.S. population). By 2030, there will be more than 3 billion, representing 66% of the world’s middle class. These customers are all want the high-end, well-made goods that Americans design or manufacture: Apple products, Tesla cars, Hello!Lucky Egg Press  and Rifle Co. greeting cards, Heath Ceramics, Shinola watches, Melissa and Doug educational toys, and all the latest boutique or innovative products from America’s thriving design, tech, and maker communities.

2.     Almost every small business can be an export business. By 2020, the entire world population will be on-line.  They will be shopping online with expectation of being able to buy globally.  Even bricks and mortar stores – including service providers like a bed and breakfast – can export.  Tourism is one of the U.S.’s biggest exports: through a little savvy online marketing, small businesses with a bricks and mortar presence can make themselves a go-to destination for tourists seeking a local, authentic American experience.

3.     Current technologies make it easier than ever to start a small or virtual business. Sites like Square Space, Mail Chimp, and Stripe make it possible for anyone to set up an e-commerce site and start building community in a few hours.  Crowd-funding platforms like Kickstarter and Indiegogo and peer-to-peer lending platforms like Lending Club make it easier than ever for small businesses to obtain financing. Marketplaces like Etsy, eBay, and Amazon Exclusives give small sellers a highly visible place to market their wares. Amazon has the potential to offer increasingly cost-effective distribution services for small businesses and to use its purchasing power and economies of scale to make small businesses more competitive on shipping cost and delivery times.

4.     Customers overseas want your products.  Consumers – especially the growing ranks of overseas middle class – want goods that are 1) useful 2) affordable and 3) reflect their human values and aspirations.  Increasingly, U.S. made goods will meet all three of these criteria as our value-added manufacturing and innovative, well-designed and branded consumer goods sectors continue to grow (U.S. manufacturing is currently growing at twice the rate of the overall economy).

5.     If TPP fails, foreign countries will increasingly shut U.S. small businesses out of their markets. They are not stopping to wait for us, and we will get shut out of global markets while countries overseas ink one-off trade deals that make it simple for them to trade with each other.  In particular, some countries are trying to enforce protectionist internet laws that would be terrible for small e-commerce businesses, such as requiring overseas businesses to have a physical server on the ground in that country in order to do business.  TPP will ensure that this does not happen.

6.   The U.S. cares about global stewardship: everything from fair labor laws to environmental protection. TPP is the most progressive trade agreement in history in that it helps to bring partner countries in line with values that not only U.S. values but universal human values that are in the best interests of long-term peace and prosperity worldwide. Again, if we don’t lead the way, other countries will – specifically, China will. Would you rather have China setting environmental and human rights standards globally?  Or the U.S.?

7.     TPP will remove lower tariffs to U.S. small businesses doing business overseas and make regulations simpler and more consistent.  The U.S. is currently an open market, and we need other countries to reciprocate to level the playing field. With inbound trade tariffs at just 1.9%, we make it very easy for other countries to do business with us.  Many overseas countries currently do not reciprocate our open trade policies. TPP will change that, leveling the playing field and giving equal access to global markets on behalf of U.S. businesses. 

8.    Opponents of TPP are already vocally speaking on behalf of small businesses without our consent or knowledge. They claim that TPP is ignoring small businesses, and that it is catering to large corporations. They claim that if small businesses knew what was in the “secretive” trade deals, they would oppose it.

This couldn’t be farther from the truth. As an informed, engaged, and experienced small business owner, I have examined the issues and done my research. TPP is unequivocally good for small businesses and crucial to the future stability and growth the U.S. economy.  The President and U.S. Trade Representative Michael Froman are extremely focused on the needs of small businesses. In a half-day White House briefing by key senior Administration officials that I attended on March 18, 2015, the 45 small business owners there were unanimously passionate in their support of TPP.  The administration and small business owners have just having a hard time organizing to vocally engage for all the reasons listed above.  That needs to change, and I invite all small business owners to spread the word about the Share Trade campaign to help ensure that our voices are heard.

9.     As pressing as all your immediate business problems are, you can’t afford to not think about exports. And it doesn’t have to take a lot of time. Small business advocates are working to make export data and advice more available to you.  Government agencies you’ve probably never heard of are waiting to help.  More work is needed to create super user-friendly and idiot-proof websites and apps for small businesses who want to export, but for now here are a few resources to get you started:

  • Business Forward's Trade Resources page provides a good overview of trade policy and links to export resources
  • Local and state International Trade Development Authorities such as CITD
  • Export Virginia  -- not just for Virginia residents, Export Virginia offers market research, Exporting 101, and organizes international trade missions that are open to all
  • Local Chamber of Commerce
  • Local District Export Councils
  • Online resources like Export University are beginning to crop up; continuing education courses are offered at many local colleges and universities
  • Shyp is an awesome new app in SF, NY, and Miami and coming to LA that will ship your international package for you and handle all the customs paperwork. Sweet!
  • Etsy and other marketplaces have international shipping and export user forums
  • Google and Twitter (@WSJSmallbiz, @SmallBizExpo and many others) are your friends in continuing to access free tips and new info online

Do you know of a helpful export agency or resource?  Share it in the comments!

10.  You’re not alone: the power and wisdom of crowds.  Currently, there are 28 million small businesses in the U.S. but less than 10% -- around 300,000 small business – export. Not for long. As more and more small business owners begin to take advantage of the growing overseas opportunities by exporting and importing, we will be able to effectively crowd-source information and best practices and remove barriers, such as high outbound shipping rates and port obstructions, through our collective influence and purchasing power.

Are you a small business?  Get involved in the Share Trade campaign here, and sign our petition to support TPP.  Thank you so much for your support!

Fears about TPP and how to resolve them

UPDATE AS OF 3/18/2015 WHITE HOUSE BRIEFING ON TRADE

Today, I had the opportunity to personally ask U.S. Trade Representative Michael Froman about the fears below at a White House briefing on trade.  It made me feel confident that critics' concerns are being addressed in the TPP negotiations in a thoughtful and constructive way. See below for details. Thank you, Representative Froman. On behalf of the 50 small business leaders who attended today's briefing, we are thankful to have someone as thoughtful and informed as you negotiating these historic trade agreements on our behalf.

A number of fears have been expressed about Trans-Pacific Partnership, the upcoming trade deal that would make it easier for U.S. manufactures and makers to access the 95% of consumers who live overseas in anticipation of the entire global population being online by 2020 and rising standards of living and spending power overseas. 

Congresswoman Elizabeth Warren (D-Massachusetts) and other TPP critics cite a number of legitimate concerns about TPP. However, they go too far in globalizing the concerns and engendering fear. For each of these fears, I directly ask two questions: 1) is it true? and 2) how could we work together to arrive at a win-win solution?

FEAR

Trade deals are negotiated in secret because small business owners and workers would oppose them if they knew what was in them. 

IS IT TRUE?

No.  I and many other small business owners are supportive of TPP and recognize that there is give and take in any complicated, multilateral negotiation. What is true is that some privacy is needed by negotiators to be able to work out complex logistics -- just as any creative process needs a safe zone in which to emerge without the constant scrutiny of critics.  It is also true that greater transparency would help the public get on board with these important trade agreements. 

POTENTIAL WIN-WIN SOLUTION 

Strike a balance. Release sections of the agreement that are close to being resolved and/or have the potential to be controversial to the public prior to presenting the entire TPP agreement to Congress for approval.

UPDATE AS OF 3/18/2015 WHITE HOUSE BRIEFING ON TRADE

Opportunities for public comment, testimony and feedback have been and continue to be a systematic, routine part of the TPP negotiations, according to U.S. Trade Representative Michael Froman. Members of Congress, acting on behalf of their constituents, have regular opportunities to review key parts of the in-process negotiations, and key advocates on both sides have been invited to give feedback on pieces of the agreement.  The negotiations are being conducted in a way that is as inclusive and transparent as they can realistically be without compromising our ability to get key concessions from our trading partners. For example, a foreign government may be in the process of conceding to enforcing stronger local labor laws, which might be a sensitive issue among some of their constituents. Making sensitive negotiations public would jeopardize the U.S.'s ability to help countries globally raise environmental, ethical, labor, and human rights standards.  The U.S. Trade Representative's Office posts regular updates on the negotiations at https://ustr.gov/tpp.

FEAR

Large corporations are rigging the trade deal to get special "gifts" or favors that benefit them. 

IS IT TRUE?

I don't know, but it appears that the pharmaceutical industry, in particular, is attempting to take advantage of the agreement to extend patents and that would keep drug prices high in developing countries, costing human lives.  Check out Doctors Without Border's campaign here (disclosure: I have signed their petition as I believe that these provisions do not belong in TPP).

POTENTIAL WIN-WIN SOLUTION

For the pharmaceuticals, limit patent provisions to non-essential drugs, or remove them altogether.  Pharmaceutical companies: focus on innovation, not patent protection.  Remember your mission as a business is to heal human beings, not maximize profit at the expense of the human lives. Consumers in the developed world: remember to question whether drugs are always necessary. Growing evidence shows that holistic and natural cures, combined with Western cures, are the best way to prolong healthy lives.  I am not sure what the other potential corporate provisions are in the agreement but do have faith that those at the negotiating table will not put greed over the well-being of humanity.
 

UPDATE AS OF 3/18/2015 WHITE HOUSE BRIEFING ON TRADE

U.S. Trade Representative Michael Froman is aware of the need to ensure that people in developing countries have access to generic medications. The U.S. healthcare system itself relies heavily on generics to provide affordable care to our own population; we are not going to treat anyone overseas differently from our own citizens. On the other hand, patent protection is what gives pharmaceutical companies the incentive to invest heavily in R&D for new drugs, something that has been on the decline. I am confident that Representative Froman will strike the right balance between fair global access to generic drugs and keeping incentives in place for R&D innovation.

FEAR

Due to something called ISDS (Investor-State Dispute Settlements) multinational foreign companies are going to start suing governments to protect their investments, and restrict government's ability to set domestic policy e.g.: environmental and consumer protections. In essence, foreign investor companies would receive preferential treatment over domestic companies and would potentially be exempted from domestic regulations.

IS IT TRUE?

I don't know, but judging from the key cases cited here, the threat seems manageable. In addition, the independent tribunals that arbitrate these country-company disputes are becoming more transparent and accountable. ISDS seems most relevant to developed countries investing in unstable, developing ones, and it seems to potentially be falling out of favor. In 2011, the Australian government announced that it would stop seeking investor-state dispute settlement provisions in trade agreements: 

"(Australia)...supports the principle of national treatment — that foreign and domestic businesses are treated equally under the law. However, the Government does not support provisions that would confer greater legal rights on foreign businesses than those available to domestic businesses. Nor will the Government support provisions that would constrain the ability of Australian governments to make laws on social, environmental and economic matters in circumstances where those laws do not discriminate between domestic and foreign businesses. "  Source

POTENTIAL WIN-WIN SOLUTION

Ensure transparency and accountability of the tribunal so that disputes are treated fairly. To prevent abuse, clarify conditions under which a foreign company can legally sue a domestic government -- and when they cannot. Investors need some protections, but foreign and domestic companies should be treated fairly and subject to the same laws.

TPP is too important to small and medium-sized businesses and to the U.S. and global economies to be sidelined by fear over resolvable issues. We all need to work together against the problem of how to navigate rapid globalization and technological change -- not against each other. We need to work from a place of clarity, compassion, and flexibility -- not fear. We need to focus on the present and future -- not the past.  And ultimately, we need to have faith in abundance and embrace change.

 

UPDATE AS OF 3/18/2015 WHITE HOUSE BRIEFING ON TRADE

ISDS is critical to ensuring that small businesses exporting overseas have recourse to appeal in the event of misconduct by local governments. Most importantly, ISDS is needed to protect the intellectual property rights overseas. IP theft is a core fear for many innovative U.S. businesses entering foreign markets, particularly those in our thriving tech sector.  ISDS helps ensure protection. The examples of abuse cited by TPP critics are few and far between, and as I note above, they can be managed and avoided.  ISDS is critical to protecting the interests of U.S. businesses abroad, need not result in abuse. Claims that ISDS poses a threat to the U.S. government's freedom to regulate are overstated and misleading to the American people.

Lower shipping costs needed to access global markets

High shipping costs to customers overseas are a major barrier to small business exports. In the meantime, Chinese exporters are getting subsidized to ship to the U.S.

Photo by monkeybusinessimages/iStock / Getty Images
Photo by monkeybusinessimages/iStock / Getty Images

Google Chairman Eric Schmidt predicts that the entire global population (7 billion) will be online by 2020, just five years away. This is a huge opportunity for small- and medium-sized businesses to export their products directly to consumers and wholesalers overseas.   But there is a major barrier stopping them: international shipping costs.

Right now, it costs about $70 for Hello!Lucky to ship a typical $100 wholesale order of greeting cards internationally. An $30 retail online order costs $50 to ship overseas. Imagine if you saw those shipping rates at checkout. Small businesses care about their customers' perceptions, so we subsidize the cost or do not offer international shipping at all. 

In contrast, according to the Washington Post, Chinese shippers receive subsidies from the U.S. government via something called "ePacket."  Though epacket, USPS subsidizes shipments from China to the U.S. -- so much so that it is meaningfully cheaper for a Chinese seller to ship a 3-pound box to the U.S. than it is for, say, a U.S. seller to ship the same box from San Francisco to Boston. See detailed examples here.

This is a big deal if we want manufacturing to return to the U.S., and if we want to take advantage of the exponential increase in global trade.

There is reason to think the U.S. could be one of the countries to lead the way in an entrepreneurial boom in the next decade. Technology, ranging from 3-D printing to crowd-funding, is rapidly removing barriers to anyone starting a business (see Peter Diamandes' new bestseller, Bold).  This means the number of entrepreneurs, makers, and manufacturers is poised to skyrocket by 2020.  To take advantage of this growth engine -- and to promote universal human ideals represented by the products these entrepreneurs create -- the U.S. needs give small business owners access to the global marketplace.

It all starts with lowering outbound shipping costs.