In this five-part podcast series, sponsored by Assent Compliance Inc. (Assent), I explore market access for supply chain data. During the course of this series, I visit with several members of the Assent team to introduce the topic, consider what market access is, provide an overview of trade compliance, Federal Acquisition Register (FAR) flow downs, the value of continuous monitoring and the origins of laws impacting market access. In episode one, I visit with Travis Miller, General Counsel at Assent Compliance. We introduce the topic of market access and how companies are responding to these requirements.
We began with what I thought was a straight-forward question – What is market access? It turned out the answer was a bit more complicated, as Miller explained. He related that market access really means the ability to sell a product into a given market. However, it is up to whomever might be in charge of allowing certain products to enter into the market, dictate what controls are put in place and what the requirements may be for entry. It can be defined by law or industry standards.
Miller stated, “when we think about market access, we take a very pragmatic approach. There are the legal requirements, there are physical steps you have to take to bring a product to market and all of this occurs before we even get to the question if anybody ever wants to buy it.” In the current business environment, the access to global markets is something that companies continually struggle with. They struggle with it from a legal regulation, commercial consumer, customer and, even now, from a political or geopolitical standpoint.
Obviously, these hurdles must be overcome. I asked Miller how can and how are companies responding to global market access requirements? He said there is a growing realization that one product may not qualify to be sold into multiple markets. There may be different component, manufacturing, financial or environmental requirements.
Now overlay all these different legal or trade requirements on the current social media platforms and you have a situation where a company can get into legal/trade/reputational hot water very quickly. Social media amplifies these issues. Further, different brands can mean very different things in different markets. Miller gave the example of the brand “Made in Germany” which may connote quality and craftsmanship, yet after the Volkswagen (VW) emissions-testing scandal it might mean something very different outside Germany. He said, “if the concept is that German cars are made by cheaters, other folks that are within that same region can encounter enhanced scrutiny and punishment and a negative effect.” A key response is compliance because if “you can’t show that at least you’re not acting in a negative bad way and that you are meeting those industry standards and norms, you may well be assumed to be a cheat as well.”
Interestingly, one business response to the limitations placed on market access have been to “go local”. Miller said, “you see a lot of conglomerates or large brands have really spent an incredible amount of time, wealth and energy is to create the appearance of being local even though they might be an international brand. What they’ve done is they’ve found brands that appeal to or that are domestic in nature and that have that value.” It has now moved to manufacturing and “Supply chains and domestication of producing items are becoming more centralized and localized and specific regions or hubs.”
With the Trump Administration’s burgeoning trade wars, there is greater fragmentation of the global access capability. We have previously lived in an era of open trade access. Now countries, such as the US, are starting to retrench from that position. Yet Miller sees it in a broader context as he believes it is “really a global phenomenon designed to protect and secure data assets to secure your innovation and to secure your market. For the Supply Chain this obviously means increased complexity in sourcing. Miller closed by noting in a recent article in Fortune, entitled “Tomorrow’s CEOs Will Come from an Unlikely Place: The Supply Chain”, author Nader Mikhail said, “the CEO’s of tomorrow are going to come from the Supply Chain, because this is the corporate discipline which must have the ability to analyze and understand those risks.”
Join us tomorrow where provide an overview of trade compliance. You can check out more about Assent Compliance Inc. at their website, by clicking here.