Exporting To The USA

Having shared a long history of trading, the US is a prime location for UK businesses looking to export. However, potential obstacles do exist despite the common language. Find out the questions you should consider and who to turn for information.

The US is currently the largest and most powerful economy in the world, sharing the foundation of language, law, and taxation with Great Britain. No wonder then that North America is the UK’s largest single export partner.

The statistics speak for themselves: a current GDP per capita of $48,100; total GDP of more than $15 trillion; and a working population of 154 million. Like the UK, the US is a service-based economy with a thick vein of cutting-edge businesses in the technology sector.

It is modern, democratic and has mature markets, making it an attractive place in which to do business for entrepreneurs from the UK and elsewhere. UK Trade & Investment (UKTI) identifies the country’s key areas of business as technology, media, energy, security and life sciences – the same industries that are enticing people to Britain.

“The UK and the US share a long trading history,” says Martin Hodges, Head of Trade at Santander Corporate and Commercial Banking. “It’s been our biggest export marketing for a number of years and there are some extremely strong links. The UK is the US’ fifth largest trading partner in the world and second in Europe after Germany.

“There are plenty of commonalities between us and, of course, there is no language barrier to make things more complicated. It’s a very simple market to export to in terms of its customs.”

Common ground

The US boasts exceptionally favourable trading conditions. The country is easily accessible despite its distance from the UK and, unlike many of the world’s hot economic regions, you don’t need to find a sponsor or a local guide to help you set up a business. It has a light regulatory touch and levels of red tape are among the lowest in the world.

Even more helpfully, almost every state in the US (apart from Louisiana) runs a legal system grounded in British common law. For the most part, this means you already know the basic rights and wrongs of doing business within the system.

But while the UK and US share historical ties that make doing business similar in both countries, centuries of independence mean that differences have crept in. For example, product classifications sometimes differ, and consumers are comfortable with different sales approaches.

“You might think twice about exporting to the EU currently, because of the economic problems the group faces and potential difficulties that some EU businesses will face in terms of cashflow,” says Martin. “The US is currently perceived as a safer bet.”

Ask the right questions

This safe bet comes with a caveat. “It shouldn’t be seen as a single market, there are 50 states and they all have different legal structures. Things are done differently in different states. If you have exported to New York in the past, don’t assume you know how to set up a shop in New Mexico.”

As with any big decision, you should do your research before deciding to export to the US. UKTI can give you information about your target industry in the US. It can also help set up or find trade missions for your company, allowing you to visit and learn from other business leaders.

Before you start, UKTI suggests you consider the following questions:

  • What is the product? What does it do?
  • Who are the end users?
  • How does the product reach those end users (who buys from me)?
  • How does my product compare to the competition?
  • Why should someone buy the product?
  • What type of remuneration do distributors, agents or representatives expect?
  • How will customer service be handled (warranties, returns, repairs)?
  • How much and how long can I afford to invest in the market before seeing a return?
  • Do I need an office in the US?


“It’s all about the preparation,” says Martin. “Knowing your market and knowing your customers, whether you’re exporting to the US or high-risk jurisdictions, you still want to get paid for your goods. There is so much information available from organisations like UKTI. It makes life a lot easier.

“For example, when planning your marketing campaigns, think very carefully about the words that you use. In some cases our ‘common language’ doesn’t feel so common and you don’t want to be marketing ‘trousers’ instead of ‘pants’, for instance.”

It’s a good idea to employ an agency to take care of translating product and marketing materials, including guides and accompanying literature. Descriptions and guidance written in ‘British English’ often breach US regulations for proper product writing.

Apart from UKTI itself, Martin believes banks are another good source of advice and information, especially when it comes to information about finance, guarantees and credit and how to get paid with the minimum of fuss.

Fees and tariffs 

It’s vital to know about fees and tariffs that foreign businesses must pay in order to access US markets. There are a large number of these and they vary depending on the product you intend to sell and the state you want to access.

According to UKTI, the main costs you could encounter include:

  • Filing fees for incorporation
  • Attorney’s fees
  • Minimum franchise taxes
  • Office space
  • A business insurance package
  • Salaries and payroll expenses
  • Immigration visas.

Products entering the US will almost certainly qualify for duty unless they fall into an exempt category, which is unlikely. This is where the classification of your product line becomes important, as it will define how much money you must hand over.

You will also need documents that are both up-to-date and in order. These will include packing lists and customs forms, as well as a ‘bill of lading’ or carrier’s certificate, a commercial invoice showing the value and description of the products you are carrying.

“Although the US is considerably easier than most countries to do business in for UK companies, it is still a foreign country,” says Martin. “My best advice is to spend time finding out about your market, like you would if you were investing in a developing country. Otherwise you could be caught out with a costly mistake.”

Tread carefully when planning to sell in the US, because even the land that gave us the American dream can spring the odd nightmare upon those who throw caution to the wind.

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John Carroll - Helping businesses achieve International success. Head of Product Management & International Business, Santander UK