GO BIG OR STAY HOME | Global Trade Magazine
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  September 18th, 2017 | Written by

GO BIG OR STAY HOME

IN ONE SHORT YEAR, CASTUS HAS HELPED COMPANIES EXPAND BEYOND THEIR COUNTRIES’ BORDERS—THE SMART WAY

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  • We spend a decent amount of time trying to encourage companies to expand overseas.
  • We coach clients not to jump at every overseas opportunity.
  • If you jump at every overseas opportunity, you will get burned.

Damon Claus formerly led global sales at 4moms, the Pittsburgh, Pennsylvania-based maker of technology-enabled baby gear such as infant tubs, swings and car seats. After helping 4moms break its products into more than 50 countries, leading a team of sales professionals around the globe and logging enough frequent-flier miles to redeem a first class ticket to Neptune, he left the company he’d been with for a half dozen years in June of 2016.

I was looking for a change,” explains Claus over the phone from his new office in the Pittsburgh suburb Aspinwall. “My wife gave the final nudge. It was something I had talked about for a year, and she said, ‘If not now, when?’”

What Claus had talked about was starting his own global business development company. This past August, the Claus-founded Castus Consulting LCC—the hip kids just call it Castus—celebrated its one-year anniversary.

It’s been an exciting year,” Claus says matter-of-factly, his shrug audible over the phone.

However, in those 12 months, Castus has created global business strategies for companies in the pet care, maternity and juvenile products categories, with a client roster that includes Petco, Prinsel, Milly Button, Spand-Ice, The Motherhood, Finn + Emma and Omnio.

If those sounds like the types of businesses that would be attracted to a consultancy that is honest and displays integrity, you should know that castus is Latin for “morally pure.” They are values Castus seeks from its clients and partners—as well as a willingness to work really, really hard.

And smart.

Knowledge is Key

Before the August 2016 Castus launch, Claus talked with people in a variety of industries—or as he puts it more simply, “I did a lot of homework and talked to a lot of folks.”

What he discovered was many wanted to tap into his knowledge base concerning taking a business global. Doing that with (and for) a single company had gotten stagnant, frankly. The idea of helping multiple companies in various sectors with several different key players “was really enticing to me,” Claus confides.

Fortunately for the Virginia Tech Hokie, his services would be offered during a perfect storm for U.S. businesses.

The opportunities for companies to expand globally are better than they ever have been before,” he says. “With new markets open for trade, Castus can help companies of any size define a global sales strategy, implement a process and position the organization for sustained growth.”

But isn’t that what economic development offices around the country do? With incentives to boot?

Claus, who was fresh from speaking at a U.S. Department of Commerce forum, answers, “We go hand in hand with the U.S. Department of Commerce and other agencies all the way down to the local level. We offer a special value, a different type of value.”

The best explanation for that value came not from him but to him, courtesy of a federal official.

Five of us met with the Department of Commerce in Pittsburgh, and I said I don’t want to be competition to them,” Claus recalled. “The lead guy in the Pittsburgh office came up with the best description. He said, ‘I really view you guys as players who can speak with experience, where we are really coaches.’”

Getting companies to accept coaching has been half the battle.

With companies initially, we spend a decent amount of time just trying to encourage them to expand overseas,” Claus says. “The more established companies like Petco are very clear about their options; they just don’t know how to execute. The big difference with smaller companies is we engage them with a fair amount of education on the front end about where there is opportunity, what it is and why you should be investing in this kind of strategic development.”

If often takes a company like Castus or an executive like Claus to recognize a company’s global potential before the company does.

The biggest misconception among business owners viewing this kind of development is one will say, ‘Yeah, I want to sell internationally, we have had a little success domestically, and our product can be taken to anyone and everyone.’ But we tell them there is a distinction between being a company that ships internationally and being a global company.

In our terms, it is more strategic to take a long-term approach. It’s good to get cash in the door, and our clients and partners expect that, but we coach them not to jump at every opportunity. If you jump at everything, you will get burned. We have to get them away from chasing leads and instead plan for a long term growth opportunity.”

How They Do It

You are a typical client. Castus identifies prospects, negotiates partnerships and builds your global distribution network. How? By leveraging existing relationships, first-hand knowledge and insightful data to make informed decisions that should have you seeing new revenue right away.

Deciding to go global is one thing. Deciding where exactly to go on the globe is a whole different matter. Each market is vastly different, even when it comes to the regions within a single country. Castus helps its clients identify, research and target specific markets, channels and partners through a strategic and measured process that is built on data and personal knowledge, boasting that its valuable insights save time and money.

But besides looking out, Castus looks inward at its client companies—and most especially their sales forces. Many fledgling companies have terrific products that international customers would love to scoop up. The same companies often rely on young sales people who may be eager but need direction on how to find the right customers and close sales.

To help Claus on that end, he convinced his former 4moms colleague Julie Block to join him at Castus. “Her skill set is building business channels, leveraging her knowledge,” he says of Block. “Her skill sets made sense.”

Especially when you consider that while serving as national account manager at 4moms, Block used her expert store knowledge to disrupt the juvenile industry with buybuyBABY and Babies R Us. Between just those two chains, she visited more than 170 stores and pioneered and grew grassroots training and merchandising programs and is credited with doubling business between 2013 and 2015.

The Motherhood Inc., a Pittsburgh-based social media marketing company, and Millybutton LLC, a Sewickley, Pennsylvania-based maker of a clasp that helps breastfeeding mothers protect their clothing, are all in with Castus.

Working with Castus is a true partnership,” says Cooper Munroe, the founder and CEO of The Motherhood. “Every step of the process, the Castus team is fully engaged and works tirelessly to understand every aspect of our business to help us succeed.”

Besides delivering The Motherhood “superior results,” Castus “is a lot of fun to work together, too,” Munroe adds.

Castus helped us run numbers, establish MAP pricing and come up with a market strategy,” reports Millybutton CEO and co-founder Elizabeth Best. “[They] provided information on quality control, material testing, advised us on graphics for our website and put together a presentation that we can use to obtain funding and partnerships. We feel a lot more confident in our strategy and have defined goals because of Castus.”

Beyond Year One

With Claus’ proven success in breaking into international markets and Block’s understanding of U.S. retailers’ online and brick & mortar markets, strategies and distribution goals, both have plans to grow the Castus client roster in 2018 by offering increased professional training, team building and recruiting functions.

Having baby clothing makers, maternity product producers and The Motherhood in the fold is quite appropriate for a one-year-old. (And a large pet supply retailer like Petco doesn’t hurt either.) But Claus recognizes Castus can and must expand into other sectors to ensure long-term success. Is the company’s knowledge base applicable to vastly different industries?

Yeah, that’s the belief,” says Claus with that happy-go-lucky shrug again. “Even if you are engaged at the local level in a service-based or non-consumer-based company, we offer services to clients to help structure their business development practices. We bring some strategy to what is otherwise a haphazard process. That’s the theory: that we bring priceless insight to our partners that can be transposed to any industry. So far it has worked very well.”

Looking at the ever-changing global landscape, he sees opportunities and challenges.

From the challenge perspective, there is a fair amount of geopolitical uncertainty right now that has gotten people spooked. After the U.S. elections, we were in the middle of negotiating with a partner in Mexico, and they put in a full stop and said, ‘We really need to reevaluate what is happening.’ There is a lot of talk about that coming at you combined with people looking at Brexit and the instability in Asia.”

Yet even there, there is hope. Claus cites the fluctuations of the Mexican peso. With Donald Trump’s election, the value of the peso plunge. As we spoke, not even a year into the Trump presidency, the U.S. dollar had dropped 17 percent against the peso, and net long contracts on the peso had risen to the highest level since May 2013. Claus has a one-word reaction: “Amazing.”

Initially, there can be a shock with geopolitics that runs through companies and markets,” he notes, “but then they realize life goes on, people buy things, and we’ve got to continue with business.”

As for opportunities, Claus casts his gaze at the Far East, among the many regions on the planet he has visited often as an international sales professional.

We continue to see trends in China as a huge consumer market,” Claus says. “It’s fascinating that the last four years I have traveled there to try to build business there, I have watched businesses succeed and, in some cases, fail. But there are still great opportunities.”

Anywhere else?

India is a really interesting region,” he replies. “It has a massive population with a huge disparity in wealth, but the small percentage of people with wealth is still a significant amount, and they have buying power. India and China are the regions we are helping our partners with.”

Especially when it comes to the latter, companies have to be smart going in, Claus cautions.

You need to be really strategic about how you approach the China market. It is so fascinating. One specific thing in terms of the consumer market is the amount of buying happening online; it’s more than anywhere else in the world. Where it’s 10 percent of the transactions in the U.S. and 7 percent in the UK, it’s 44 percent in all of China.”

Is that due to a lack of products or preferences in purchasing online in China?

It’s a mixture of both,” Claus answers. “The powers that be were against outside brands 7 to 10 years ago. It’s a testament to how fast technology has gone. Overnight, everyone had a cellphone and was able to buy stuff on Alibaba. The speed to which they have gone from having nothing to having everything is fascinating.”

Despite lingering Chinese hurdles that still must be cleared by U.S.-based companies trying to break into that market for the first time, opportunities abound, Claus insists.

Made in the USA is still huge. Set aside the geopolitics the U.S. flag may now represent. The U.S. has long stood for high standards and quality craftsmanship.”

Claus need only look at one of his clients.

A great example is Petco. Their food exceeds most human consumption requirements in many other countries. There are huge manufacturing companies in the U.S. and our consumer goods carry a lot of weight internationally.”

In Turn Around

Something unexpected has happened at Castus after one short year of a mission to help U.S. companies expand globally.

We have found our services being sought in the reverse,” Claus reports. “Companies based overseas have asked us to help them break into the U.S. market.

The United States is still the number one retail market in the world. That huge purchasing power is tough to navigate [for an outsider]. Helping them is a fair amount of our work as well, but it wasn’t part of our initial game plan.”

Like the companies Castus assists, Claus discovered previously unknown opportunities. He credits to “listening to potential customers.” Of course, being a good listener is what helped get his company off the ground a year ago.

Remember his wife telling him, “If not now, when?”

As Claus and his audible shrug put it: “I made a good career decision.”

Does Castus sound like a company your company should be talking to? Call them at (414) 522-7887 or visit castusglobal.com.


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