Doing Business in LA: Mainfreight

By Brierley Penn

Understanding the key differences between the various cultural settings in which they operate has been integral to Mainfreight’s success in an increasingly globalized business environment. With a market capitalization of $1 billion, and 75% of their revenues coming from offshore sources, the company no longer considers themselves to be a purely New Zealand business.

The company entered the US in 1999, a decision which they considered to be inevitable given the size and weight of the American economy. “It was more of a necessity, we had

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to make a move,” said Jason Braid, USA Director of International Sales. Continuing their international strategy, Mainfreight also entered the European market two years ago, and are now operating in nine countries in the region.

Mainfreight is a company that is big on culture, but Braid stressed that importing a New Zealand culture into an American market may not be a successful business model. “Americans and Kiwis are different. We may look the same, but we’re a different breed. We need to understand that.”

The increased levels of bureaucracy in the US was one aspect of doing business that may heighten the complexities of moving into the market. “The bureaucracy makes things slow,” Braid said. More red tape, and greater influence of unions may present challenges that New Zealand businesses are less accustomed to in our domestic market.

The disparities in culture and business practice range from small-scale changes in moving from weekly accounting systems in New Zealand to monthly in the US, to more fundamental differences in hierarchical structures.

While Mainfreight operates a traditionally flat organizational structure, with open-plan offices, by contrast, many US employees spend their working lives aspiring to the so-called “corner office” of their organization. Braid highlighted that the American way of structuring businesses can be very different. “One of the biggest challenges we faced was a hierarchy issue.”

Despite these initial challenges, however, Braid was quick to highlight the importance of the US as an integral player in global markets. “It’s a very competitive market and that’s a challenge, but it’s also an opportunity. You can’t underestimate the competition here.”

With the US economy still the largest in the world, Braid said there were undoubtedly huge opportunities in the market. Their approach to the US is certainly one of necessity. “It can be tough, but it’s worth it.”

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