The Essential Guide to Going Global

Chapter 2. Take Advantage of Trade Agreements: Think Outside the Border

Free trade agreements and trade preference programs provide global entrepreneurs with a clear competitive advantage. Decisions about where to set up a business venture, how to locate the best sourcing opportunities, and how to develop a strategic plan for the future are all dependent on a thorough knowledge of the trade opportunities these programs provide. New multicountry alliances are being formed all the time. Global entrepreneurs need to aggressively pursue their interests during trade agreement negotiations by defining a clear agenda and getting involved in the trade policy formulation process.

The Underwear War

For the greater part of the twentieth century, Fruit of the Loom produced and sold more undergarments than any other company on the globe. But in the early 1990s, business began to change for this renowned sultan of skivvies—and not for the better. The situation in which Fruit of the Loom found itself may have had less to do with what the company did wrong than with what it failed to do right.

Simply put, the company delayed looking for opportunities outside of the U.S. border. This crucial decision left Fruit of the Loom vulnerable to the advances of another leading undergarment manufacturer. The company was Sara Lee Knit Products, now known as Hanesbrands, Inc.

Known for the popular Hanes underwear brand, Sara Lee was one of Fruit of the Loom’s most aggressive competitors. With an eye on expanding ...