L’OPE Informa is the digital bulletin of the Office of Economic Development of the Town Council of Manlleu. Every month they publish articles of general interest to the business community. Júlia Farré is Consulting Partner in International Team Consulting and her “article of the month”, Starting to Export was selected for the November edition in the section in which experts share their opinions on different corporate subjects.
ARTICLE Starting in export
Whatever the size of your company, the product or service you sell there is always an opportunity overseas. This statement probably raises the following questions in your mind: do these opportunities really exist? And, if they do, where can I find them?
For those starting to export the answers to the questions “where are they” and “how do I reach them” are the hardest to find. Choosing the wrong target market or the miscalculating the sales channel can be very expensive mistakes.
Talking about the “where”, the target countries have to be chosen very carefully by studying economic indicators adapted to our own product or service.
Very often many people will only consider macro and microeconomic factors, volumes and import/export statistics. However, other factors, perhaps more importantly, should be taken into consideration: import duties, language, freight costs, political stability, geographical proximity, certifications and approvals, cultural affinity, whether or not the country is a competitor amongst others.
“How” can be translated into the different sales channels for overseas trade. Selling meat is not the same as distributing electronics. In the same way as approaches to the market of, say, Germany is not the same as that of Brazil or the United States. Finding the ideal partner in the target country is, more often or not, the single most important factor in the equation. You need to contact with a distributor, importer or local sales agent that already has an excellent reputation on the market and is already trusted by your potential clients. This will make your landing that much easier.
Keys to ensuring your success in overseas markets:
- Plan your international strategy for the short, medium and long term. This should take into consideration the investments you will have to undertake: include this in your export operating margin.
- Evaluate the personnel necessary and be realistic about the targets you set yourself.
- Don’t jump into the first market about which you have heard “bells ringing”. Study the markets and choose the ones that best suit you.
- Chose your product and/or service and make sure it fits with your target market.
- Draw up an international pricing policy.
- Make sure your partner is right for you; be exacting in your selection.
- Get professional advice before signing sales/distribution contracts.
- Be pro-active when following up the work of your distributors or agents.
You cannot expect real returns on your international investment in less than 3 years meaning you will have to work constantly and patiently.