THE BLOG

Zeroing in on the Challenges Facing UK Companies Entering the US Market

19/09/2014 10:38 BST | Updated 18/11/2014 10:59 GMT

Clothing retailer Primark recently revealed that it would embark on a £200m bid to enter the notoriously merciless United States fashion market with plans to open a Boston store in late 2015.

The Associated British Foods subsidiary hopes to succeed by focusing on states in the Northeast, and will initially launch in Boston. It has identified openness to European influences in the region and plans to exploit them - essentially addressing and solving an age-old concern for UK brands attempting US expansion: navigating a multi-state market with a high degree of cultural and consumer variance.

Last year, a Barclays report on retail opportunities revealed that 40 percent of its respondents had identified the US market as one of the top countries in regards to sales growth. One of the frequently cited success stories in this realm is Top Shop - which is scheduled to open a Topman store on New York's Fifth Avenue, this November.

Other marquee British brand names like Marks & Spencer, and more recently Tesco, have failed in their US infiltration efforts, demonstrating that money alone does not ensure cracking such a lucrative but competitive overseas market. Tesco's timing was said to have been inopportune when it launched its Fresh & Easy outlets in 2007 amidst difficult financial times when consumers weren't all that adventurous. The company was also critiqued for misunderstanding American tastes. Similarly, M&S, in its Brooks Brothers foray, struggled to adapt to the US retail culture with its sales staff commissions.

Apart from retail and consumer goods, Britain's tech world, which has drawn ambitious startups to London's Silicon Roundabout, is another sector for which American expansion seems logical - particularly to the West Coast - notably Silicon Valley, Los Angeles' buzzing Silicon Beach and Washington state, home to Amazon and Microsoft's headquarters.

A new crop of UK/US expansion efforts also seems likely in light of talks between the EU and the US in relation to the Transatlantic Trade Investment Partnership - whose aim is to remove trade barriers by lowering tariffs and crafting like regulations. The agreement will largely focus on impediments to trans-border e-commerce.

Experts however point out that there are still, naturally, many other issues to be tackled by British companies before launching North American efforts. These include intellectual property concerns, the complexity involved in regulating trans-border data flows, as well as developing an understanding of the different tax regimes and corporate structures, and securing local staffing resources.

Accordingly, a panel discussion and networking event to be held on 1 October at London law firm Goodman Derrick, in collaboration with Tech UK will look at these and other challenges facing businesses - big and small - that have their eyes on US market infiltration. UK Trade and Investment (UKTI) International Trade Advisor Nicola Bridgett will open the event, along with Richard Stanbridge, US Commercial Service at US Embassy. Guests will also have the chance to gain insight from panellists who have taken the transatlantic plunge.

Panellists will include: Paul Webb, Partner and Head of Technology, Goodman Derrick LLP, who will chair the panel; Claire Hungate, Managing Director, Warner Bros. Television Productions UK; Paul Brennan, Chairman, Onapp; Simon McMurtrie, CEO, Direct Wines; Patrick Seely, Managing Director, Mooreland Partners LLP; and Daniel Rayner, Managing Partner, Rayner Rowe LLP. For more information visit Goodman Derrick's website.