Knowledge Visualization for the US Market Access Strategy of Turkey

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1 Knowledge Visualization for the US Market Access Strategy of Turkey Independent Study Prof. Dr. Kristen Kurland Prof. Chris Labash (Advisor) Mehmet USALAN August 2006 Project ArcGIS Files: musalan_independent.mxd, musalan_project_htextile.mxd: musalan_project_california.mxd and musalan_final.mxd files are included in the final project and they are not submitted again for space saving purposes. 1

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5 Knowledge Visualization for the US Market Access Strategy of Turkey Independent Study Prof. Dr. Kristen Kurland Prof. Chris Labash (Advisor) Mehmet USALAN August 2006 Project ArcGIS Files: musalan_independent.mxd, musalan_project_htextile.mxd: musalan_project_california.mxd and musalan_final.mxd files are included in the final project and they are not submitted again for space saving purposes. STUDY DESCRIPTION Goal: To examine what are the opportunities using spatial analysis in decision making in the preparation of the market access strategy of Turkey. Will this analysis answer to the needs to lead better decisions for increasing Turkish exports to the U.S.? How can we visualize the knowledge to help the decision makers to understand the US market? How visualization supports strategic planning for the US Market Access Strategy and decision making for the future action plans? Description: In this study we will mainly use Geographic Information System (GIS) software and related Information Technologies tools to evaluate comparative market and business conditions in the selected six States (California, Florida, Georgia, Illinois, New York, and Texas). Limitations: Although the US Market Access Strategy targets both international trade and investment we mainly focus on international trade. The data tools for business analysis ( including detailed demographic data, community tapestry, consumer expenditure, international marketplace, market potential and future projections is not freely available for the academic use. The required GIS modules ( Business Analyst and Segmentation Module ) cost at least $30,000 on annual basis. Thus, we have not included industry level analysis and future projections in this study. Thus, in our study we are only able to handle a limited numbers of questions which is mentioned in the next page. 1

6 QUESTIONS? What are our prospective buyers' profiles look like? Where the Turkish businesses and Turkish organizations located? Which cities or regions we should concentrate for marketing? Consequently in which cities should we organize trade leads and support trade fairs? Which exhibitions have more populated importers with high credibility and high sales? Where are the large wholesalers? What are the cities and regions have more purchasing power? Which of the have more diversified populations? Which of them are more competitive to attract business? Where are the biggest customs having more import volumes? Which districts have more Turkish imports and which of them have any? Which districts have more exports to Turkey? Which districts are familiar with Turkish businesses? How Turkish businesses diversify their target markets? Where are the main free trade zones? In which States and cities should Turkey open the new commercial counselors? Which business and government organizations may help Turkish business by providing information and services?..? Executive Summary US Market Access Strategy of Turkey The Undersecretariat for Foreign Trade of Turkey (UFT) has prepared a new market access strategy that targets the promotion of Turkish exports to the US. This market access strategy will be launched in the upcoming weeks. This strategy targets diversification of Turkey s export profile in terms of product range and destination, while increasing Turkey s share in US imports. New York, California, Illinois, Florida, Texas and Georgia have been chosen as target markets. The strategy is based on the assumption that each state within the U.S. consists of different market orientations and segments. Depending on the outcome of the strategy other states will be considered for the strategy s action plan. Additionally, based on statistics and industrial feedback, certain product groups have been selected as potential sectors. These product groups are: food products, chemicals, textile and clothing, marble, ceramics, non-ferrous metals, electrical and electronic equipment, machinery, automotive spare parts and furniture. As information technology promises potential for further cooperation, information technology has also been included in the agenda. The action plan of the strategy covers a wide variety of activities including strengthening Turkish commercial counselors presence in the US; developing marketing strategies for potential sectors; organizing trade, buyers and outsourcing missions; attending important international fairs in the US; promoting potential products via promotion groups established by Turkish exporters; establishing bilateral relations between business associations of the two countries; organizing seminars on the US market and import procedures for Turkish exporters; briefing US businessmen on Turkey s major industries, its products and commercial legal infrastructure. (Source: Undersecretariat for Foreign Trade, Turkey, April 2006) 2

7 MARKET STRATEGY-FACTS U.S. has historically been one of Turkey s most important trading partners Bilateral commercial relations rapidly increased in the last years. U.S. is the 4th biggest export destination and import source for Turkey as of Turkey s share in total US imports is still less than 0.5 percent as of Turkey ranks the 40th import source for the US market. TWO MAIN STRUCTURAL PROBLEMS Tendency to export to particular destinations. A limited product range form exports. 3

8 ENVIRONMENTS AND THE MARKETING MIX PLACE TOOL GIS Source: Strategy Planning, Market Entry and Implementation, p.25, Roger Bennett, Jim Blythe, ISBN: , 2002, Kogan Page MARKET STRATEGY-TARGETS The Undersecretariat for Foreign Trade of Turkey (UFT) prepared a new market access strategy Target: Diversification of Turkey s export profile in terms of product range and destination, while increasing Turkey s share in US imports. 4

9 MARKET STRATEGY-TARGETS Target Markets for the initial phase: California Florida Georgia Illinois New York Texas MARKET STRATEGY-ACTION PLAN 1. Strengthening Turkish Commercial Counselors presence in the US, 2. Developing marketing strategies for potential sectors, 3. Organizing trade, buyers and outsourcing missions, 4. Attending important international fairs in the US, 5. Promoting potential products via promotion groups established by Turkish exporters, 6. Establishing bilateral relations between business associations of the two countries, 7. Organizing seminars on the US market and import procedures for Turkish exporters, 8. Briefing US businessmen on Turkey s major industries, its products and commercial legal infrastructure. 5

10 California Texas STATE-PRODUCT MATRIX FOOD CHEMICALS LEATHER TEXTILE APPARELS HOME TEXTILE CERAMICS JEWELLERY NON FERROUS METALS MACHINERY ELECTRICAL-ELECTRONICS AUTOMOTIVE SPARES FURNITURE NEW YORK CALIFORNIA TEXAS ILLINOIS FLORIDA GEORGIA Source: Undersecretariat for Foreign Trade, Turkey, 2006 File: musalan_independent.mxd Furniture 6

11 SIX STATES, THIRTEEN INDUSTRIES (PRODUCTS) File: musalan_independent.mxd File: musalan_independent.mxd 7

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16 FUTURE PLANS: DEVELOP FOR OTHERS WITH DEPLOYING GIS IN THE STRATEGIC PLANNING TO SUPPORT DECISION MAKING A State Case CALIFORNIA (musalan_project_california.mxd) 12

17 CALIFORNIA CASE A Spatial Analysis on a Turkish Textile Exporter s Access to the U.S. (California) Mehmet USALAN CMU, 2006 PROJECT DESCRIPTION Prepare a spatial analysis tool for a Turkish Exporter who looks for export opportunitiesin the U.S market. Scenario: Attending a Fashion Fair in California (LACA Fashion,San Francisco, October 2006 ) Goal: Prepare an effective marketing strategy to maximize the benefits from attending the fair 1

18 DATA COLLECTION Demographic data (US CENSUS) Business DATA (Reference US) Foreign Trade (US CENSUS, USA Trade Online) State Competitiveness & Cost of Doing Business (The Milken Institute) US Economic Freedom Index (The Pacific Research Institute) METHODOLOGY Clearing and matching all data Clipping the selected 6 States Spatial joining tables Geocoding businesses Geocoding fair events Buffering the fair with businesses Selecting the most relevant US companies for the invitation to the fair exhibition 2

19 Modeling ANALYSIS US Commercial Organizations US Customs US Importers (with over $1 million sales) Turkish Business in US US Retailers US Wholesalers US Importers US Imports from TR States Exports to TR US Economic Freedom Index Cost of Doing Business Supported US Fairs 3

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24 HOME TEXTILES CASE A Spatial Analysis on Selected Industry Market Access to the U.S. Mehmet USALAN CMU, 2006 PROJECT DESCRIPTION Prepare a spatial analysis tool for Home Textiles Industry which was included in the State-Product Matrix. The Matrix includes six selected states and a total of 13 different industries which are selected for those states. Scenario: Home Textile Market Access Study (Selected States and Matrix States) Goal: Prepare an effective marketing strategy to maximize the benefits in accessing the US market. 1

25 DATA COLLECTION Demographic data (US CENSUS) Business DATA (Reference US) Foreign Trade (US CENSUS, USA Trade Online) US Trade Department (consultations by s&phone) State-Product Matrix (Undersecretariat for Foreign Trade, Turkey) METHODOLOGY Clearing and matching all data Clipping the selected 6 States Spatial joining tables Geocoding businesses Geocoding fair events Buffering the fair with businesses Selecting the most relevant US companies for the invitation to the fair exhibition 2

26 ANALYSIS US Home Textile Industry Analysis US Home Textile Businesses US Home Textile Business listed in Fortune 1,000 Selected and Matrix States Foreign Trade Analysis Turkey and her competitors shares in the US home textiles market MATRIX STATES California, Georgia and New York States have been selected for target markets for the home textiles products (State-Product Matrix by Undersecretariat for Foreign Trade of Turkey, 2006) 3

27 Home Textiles Market Definition One of the largest technical textile markets, this sector comprises household textiles and furnishings used in contract applications and by the upholstered furniture industry. The latter include fiberfill and wadding applications in bedding, cushions, sleeping bags and furniture backings. (NAICS 31411&31412 Textile Product Mills) The US market growth has been reasonably strong. Ref: The US Market for Technical Textiles, May 2002, Woon Chang & Peter Kilduff NC State University, College Of Textiles,,On Behalf Of: Small Business & Technology Development Center US International Trade Commission s Definition for Home Textiles Home textiles are furnishings made of textile materials and intended for residential and institutional use in bedroom, bath, dining, kitchen, and other living areas. Home textiles include the following finished articles: (1) bed linens, such as sheets and pillowcases; (2) other bedding products, such as bedspreads, blankets, comforters, and pillows; (3) toilet and kitchen linens, such as towels and wash cloths; (4) table linens, including tablecloths, cloth napkins, and place mats; (5) curtains and draperies; (6) hand-woven and needle-worked tapestries and other wall hangings. 4

28 HOME TEXTILES MARKET United States top 13 home furnishings companies ranked by sales in dollars and including import values in dollars for 2004 Source: Source: Home Textiles Today, 26 (46): 8, August 22, ISSN: , Reed Elsevier Inc., 2005 US Home Textile Market 5

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31 CONCLUSION As we have seen in our study results, there is an opportunity to visualize so many data regarding the US Market Access Strategy. Especially it would be much more easier to visualize and capture the most important facts in the jungle of isolated data islands. The fast and reliable analyzing without missing any details can support our decision making and strategic planning by using IT tools and GIS. This study can be enhanced and continued to foster the preparation and implementation of the strategy. 26