10 Things to Know to Get Products to Challenging Markets

Electrical products companies are always looking for ways to generate revenue, often with the least amount of investment to maximize returns. One approach is to place an existing product or product line in new markets, especially if the primary market’s economy is down. The biggest obstacle is complying with foreign regulatory requirements.

Many countries use some measures to restrict imports—such as duties, tariffs, technical requirements, licensing, and legal local representation—to protect their own national products from foreign counterparts. In the regulatory compliance world, these measures most often take the form of proof of compliance to existing technical requirements by way of obtaining a country-specific approval or a certificate of conformity. The latter is issued by an authorized third party or, in many cases, a government-funded ministry.

Some countries impose more import restrictions than others. An easy market has reached a high level of harmonization with accepted international standards and regulatory requirements and allows the manufacturer to leverage its existing test reports.

A perfect example is the European Union (EU) where one of the criteria of becoming a member state is to harmonize the legal framework with that of the existing members. Meeting the regulatory requirements for the EU will instantly provide access to 27 countries. Furthermore, the national language of each of the member states is an official language of the EU, which makes user manuals acceptable in any of the 23 official languages including English.

A challenging market does not accept existing reports or may impose additional hurdles, such as in-country testing. Additionally, some countries have very complex import regulations and restrictions for the samples that need to enter the country for the local testing.

While challenging markets certainly are more difficult to access than primary markets, they often represent lucrative sales territories. Once that potential is confirmed for a certain electronic product, manufacturers need to prepare and plan carefully before launching market access efforts.    

1. Design for Compliance from the Start

While the product still is in development, the manufacturer should decide which international markets to target. Identifying technical specifications in the design phase will help ensure that the product’s features will match the requirements of the target country.

It’s important to find out the estimated lead time of the international certification process—it often is several months long—so the product’s launch schedule can be defined based on that information. Regulatory certification lead times often are overlooked when product launch schedules are set up.   

2. Apply the Economies-of-Scale Concept

When selecting target markets, manufacturers should apply the economies-of-scale concept to evaluate the potential of the market to generate revenue. This microeconomics term defines cost benefits achieved as a result of growth. The most lucrative markets are those providing the biggest expansion and include China, Russia, Argentina, Brazil, and Korea for RF/telecom products.

3. Know the Basics

The manufacturer needs to know the requirements for a particular market and be prepared for them. For example, certain documents such as photos and block diagrams are required so often that an importer should have them available. Translated manuals, special labeling, samples, or test reports may or may not be required. Knowing these requirements in advance will allow the company to address them simultaneously with other tasks that precede international certification applications as well as set aside funds to fulfill them.

Mandatory labeling indicates that the imported product is certified and approved to be on the market. The form and content vary broadly from country to country.

Translation of the user instructions or safety warnings to the native language of the target country generally is required for consumer products. It may not be necessary for industrial or highly technical products because a specific level of education may be assumed; then only safety warnings need to be translated.

4. Leverage Existing Test Reports

The good news is that the manufacturer only needs to perform a core set of tests on the products once and then use the resulting test reports to apply for several international certifications. Generally speaking, challenging markets in the Western Hemisphere accept Federal Communications Commission (FCC) reports while the rest of the world accepts European Radio and Telecommunications Terminal Equipment (R&TTE) reports. Accordingly, FCC reports and ID will be mandatory in Latin America while the Middle East and Russia generally will accept R&TTE reports. However, some countries will not take test reports in place of product testing. This is especially true in Asia where many countries require in-country or country-specific testing.

As far as product safety compliance is concerned, most countries will accept test reports to International Electrotechnical Commission (IEC) standards. The majority of secondary countries do not require product safety certifications for IT equipment. Those that do generally will accept a Competent Body (CB) report without further testing. Manufacturers will need to ensure that the CB report covers all the target countries and voltages.

To get the most out of the core testing and reports, the compliance team needs to investigate the report requirements for all of the potential target countries. If the applicable test standard happens to be an internationally harmonized standard, companies should ask the testing laboratory to indicate all applicable national deviations.

5. Family Approvals

If a manufacturer has a product line with multiple models listed as part of the same product family, he must inquire if the target country will allow family approvals. The tolerance between model differences varies greatly. While the safety approval for electronic products in Mexico tolerates up to a 20% difference in rating and allows the listing of up to 10 models on a single certificate, the RF and telecom approval scheme in the same country will allow only one model per certificate.

6. Speak the Language

Although English has become the universal language of communications in the world, it is not so when it comes to challenging markets. Before launching the market access effort, manufacturers are well advised to inquire if a target country poses any special language requirements. Having translated manuals and safety instructions in the native language of the country will save time during a certification process. Manufacturers also can speed things along by building a relationship with a translation agency, especially if only a handful of companies can provide translation services to a specific language, such as traditional Chinese, Kazakh, and Croatian. 

7. Be on Time 

The certification process will go much faster and smoother if the manufacturer provides all requested documentation on time. The project cannot start until all required information, documents, and samples are provided. Most items can be prepared prior to the start of certification even though some additional items may be requested during the process.

Manufacturers also should be prepared for vastly different lead times between challenging markets. Two countries may border each other and require the same application materials, and yet one authority will grant product approval in two weeks while the other will take 12 to 14 weeks.

8. Play by the Rules

Market access requirements are meant to serve as a barrier to foreign products, protecting local manufacturers. The certification requirements are set by government agencies and can be very bureaucratic. The best thing you can do to speed up the approval process when working with government organizations is to provide everything they ask. There is little to no room for flexibility in changing the application forms, authorization forms, and declarations.

9. The Importance of Shipping

The manufacturer may encounter some of the biggest hurdles when sending samples for in-country testing to places such as China or Brazil. Countries imposing in-country testing requirements usually have strict customs regulations as well.

Even if a company is working with an independent testing laboratory on the approval, laboratories are not experts in shipping and customs clearance. The importer should ensure that its shipping department or shipping agent is well versed in the customs and shipping requirements and use only services that have demonstrated success in shipping samples to a particular country. 

10. Choose the Right Compliance Partner

A competent compliance partner can provide the requirements up-front, assist with core testing, and leverage its own agreements for report acceptance with the foreign certification bodies. This is important because various test laboratories have different agreements and accreditations.

For some countries, testing in the United States can take the place of in-country testing as long as the laboratory has the right accreditations and agreements in place. A trusted partner can save significant research time and provide the added value of project management, especially if the list of target countries is significant.

Conclusion

Even though navigating the international playing field is complicated, access to challenging markets can result in high returns for manufacturers of electronic products. Generalizations of certain regions’ test requirements can help importers sketch a compliance roadmap. Companies can enter challenging markets smoothly with plenty of advance research, preparation and knowledgeable compliance, and shipping partners on their team.

About the Author

Suzanna Nagy joined TÜV Rheinland of North America in 2008 and currently is the East Region team leader and key account project manager for International Approvals. Previously, she was employed by various high-tech companies internationally. Nagy speaks multiple languages and holds an M.B.A. from Fitchburg State College. [email protected]

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