Exporting: What you need to consider
A quick look at selling abroad
Many companies have the potential to sell into overseas markets but are deterred by the perceived cost, complexity and risk associated with exporting.
However, if your company has the right offering then the markets of Europe, North America and indeed the world can offer a customer base that is vastly bigger than that of the UK. A successful export strategy can transform your business.
Businesses selling specialist products often look to world markets from day one, simply because the home market is not big enough to cover their development and manufacturing costs. For instance, few business software companies would thrive if they relied on UK sales alone.
Others businesses come to exporting later in their evolution, perhaps because UK growth has peaked as the market becomes saturated.
But exporting can be a daunting prospect. Setting up distribution channels, winning the interest, trust and cash of customers and getting paid on time can be difficult enough in the UK context. Look overseas and the problems multiply, as you start to consider the distance between client and customer, unfamiliar cultures and a sea of red tape. So how do you know if exporting is right for you?
How to export
First assess whether an export market exists for your product. Research is required. Don’t assume that because you have been successful in the UK you will also be successful in France or Germany, so look at market reports. Talk to trade organisations and contact distributors who know the markets. Be prepared to travel, taking examples of your product to show potential partners or customers. The UK Trade and Investment (UKTI), an organisation jointly run by the DTI and the Foreign Office, can be enormously helpful in providing advice and organising trade missions.
You’ll also need to look at the skills available within your own organisation – do you have the people in place to manage an export operation. Again there is help available. The British Chambers of Commerce offers skills reviews.
There are a number of ways to approach exporting. You can use agents and distributors to market your product abroad. Alternatively, many companies opt for licensing agreements that allow third parties to both manufacture and sell their goods. Alternatively, if your brand is strong you can set up a franchise network. Meanwhile, the internet has emerged as the perfect global marketing tool, although to sell effectively online, you need to localise both your site and customer service agreements to local needs.
For further information and advice on how to export contact your local Business Link, Chamber of Commerce or UK Trade and Investment (UKTI).