The Government recently launched an Export strategy, building on their industrial strategy, that targets increasing UK exports to 35% of GDP from the current 29%.
Is that ambitious?
“It would be disappointing, except that I hope it is only a first step. We are terrible compared to our near neighbours – Germany at 47%, Netherlands and Belgium over 80% and Spain, France, Italy more than us. Should you be exporting just to help the country achieve its potential? No, you should be exporting to help improve your bottom line profitability.
“I speak to a lot of companies whose exporting journey gets stuck in the mud before it has even started. The stories that I repeatedly hear are that it is complicated, that they lack the time, money or resources needed to start exporting. I find this frustrating because exporting is simply selling. The mythology that exporting is difficult is stopping many people from expanding their businesses in a way that would provide a boost to the bottom line as well as to sales.”
How can you get on board with exporting and help build your business?
“Let’s start at the beginning. There are three criteria I always consider when looking at how to market products, they are: right product, right price, right place. You don’t try to sell a premium product in a pound shop!”
Is the product you are intending to sell suited to the marketplace you sell into?
“There are many ways of looking at this, but put simply – are you getting traction in sales and repeat sales? The right price includes considering the profit margin you are achieving, how your price compares to the competition and how it fits with the ‘norms’ in the marketplace.”
Who do you sell to now? How do you categorise your customers and how do you reach out to them?
“Taking that learning, where else are there similar customers? Exporting is not always about selling to a country, but rather to a market within and across countries. If you have a vegan product, where are the main markets for vegan products? If it is a craft beer, where are there markets that have an interest in premium product at a higher price than other beers?”
These are fundamental questions to answer whether you are selling in the UK or exporting.
“Let’s be clear, I am not suggesting that exporting is easy, but nor is selling in your home market! Taking this on board, what advantages can be gained by exporting. The biggest opportunity is the potential exponential increase in market size. I found a huge number of markets that welcome British products; we have a reputation for quality and there is an inherent trust in the brand. And that can provide a premium. You don’t have to assume that your products have to be sold at the same price in all markets.”
“Consider your route to market. If you would normally sell through distributors, then look for distributors in the same market. A distributor that has experience importing products should be able to take all of the logistics problems off your desk. Don’t underestimate the advantages of selling ex-works. An effective distributor can be one of the key advantages of exporting. Issue a despatch note and invoice when the remaining issues have been handed over.”
If you identify key potential retailers, then you can approach them directly.
“There are many large and medium sized retailers from all over the world who have buying offices in the UK or Europe. Local language and location with International reach. Their sole purpose in life is to facilitate the purchase of the most suitable local products. Whatever you are selling, find the best market and the quickest route in. You do not have to conquer the whole world week 1! Take that one step into one market and you will then be an exporter.”
Is there help available with all of this?
“There is and quite a lot of it. The Department for International Trade has locally based trade advisors who are there to help businesses get started and develop their exporting. They also have extensive information available on their website.
“Chambers of Commerce provide great resources and expertise, none more so than the award-winning Greater Manchester Chamber of Commerce. Trade organisations increasingly offer advice.
“None of this works for you? Then try a gentleman I am very familiar with – Mr Google. Keyboard based research can take you a long way! If you can set aside some budget then consider going to an international trade show, whether as an exhibitor or just a visitor to walk the floors. There are even some grants to help you. Building your business and helping your country at the same time makes a great combination.”
So just take that first step.
Tony Goodman MBE
Forest and Co