There are so many excellent reasons to export that it is hard to understand why some that could are not already doing so. It may be that they don’t think that their product or service is suitable, and some are not. They might think that it is too difficult, and they should read on, because generally it isn’t. There are those who have told me that it isn’t worth it; But who doesn’t want new customers, sales and profits?
If you ask companies that already export whether they regret it, you will rarely hear any negativity. There is a very good reason for that; exporting helps the bottom line as well as the top line, often more easily than with home sales. This would be obvious if you had a very limited market opportunity because of highly specialised products or services, but it also applies to far more competitive market places.
British products have a justifiable reputation for quality, design and innovation and can hold their place across the world. It should be that every business builds a section on exporting into every business plan they make. If they don’t, anyone reading it should doubt its veracity!
What is Exporting?
So what is exporting? At a basic level it is simply selling. The principles and the practice is no different than selling in your home market.
Who are your customers?
What criteria do you use to find new customers?
How do you price in different markets?
Do you sell direct or through distributors?
How do you market your products or services?
So far away, doesn’t anybody sell in one place any more? (with apologies to Carole King). The UK has just signed up to the CPTPP – the Comprehensive and Progressive agreement for Trans Pacific Partnership. The fellow members sit astride the world – Canada, Japan, Australia, Mexico, Chile, Malaysia, Peru and several more. This is in addition to a plethora of trade agreements across the world, including of course a comprehensive agreement with the EU. The UK’s position as a leading trading nation is firmly presented. The world just got smaller. Much smaller.
Nearly 50% of UK exports are services
That shouldn’t come as a surprise as the UK is the second largest exporter of services in the world; only the USA has more. Most of those services exporters don’t have to worry about the distance as they don’t have goods to deliver. But what of the other 50%, is transportation a problem?
Meet your new best friend
Goods exporters must factor in freight costs every bit as much as they do with delivery costs in their home market. My best advice is to find and closely work with a freight forwarding company who can become part of the pricing and logistics arrangements from an early stage of engagement. Even if you are selling ex-works (always my favoured option – please ask me why!) the freight forwarder can help you to calculate the full supply chain pricing. Having the right experienced experts as part of the team will alleviate many possible concerns.
Feet on the street
How should you as a new or inexperienced exporter cope with unfamiliar export requirements?
There are many ways, depending on how you decide to do business in each of the markets you enter (always markets not countries). One simple but comprehensive solution is to use an experienced local distributor. They can act as the necessary interface between you, the regulations, customers and consumers. My practice is to look for distributors that have already had success working with UK companies and in similar markets, but this is not essential. A good distributor will be able to take you through the local regulatory requirements, help you with translations, arrange introductions, participate at local trade shows and provide you with direct feedback.
All this is of course in addition to the main role of the distributor which would involve the transportation, storage and distribution to local customers. By ensuring that all the terms of the distributorship are agreed up front, and by your allowing the distributor sufficient margin to work with, they can take much of the administration work off your hands.
This works brilliantly as a model, as by doing so, you can have both more confidence in your own sales margin and without having additional overheads. You will then be able to use your time more effectively to enter into more such arrangements and continue your export journey. This virtuous circle of engagement does require nurturing and it is important to set aside time and some budget to support the distributor and their team and ensure that they become an extension of your business that can replay your messaging with the same enthusiasm as you do.
Exporting should be a profitable extension of your business with like-minded markets around the world, many of whom are already fans of UK style and quality, providing a plethora of opportunities. It is never too early or too late in a business to start to export, you just need to take the next step.
Tony Goodman MBE is a successful exporter and has been doing so through a variety of different businesses. He is currently Marketing Advisor at Forest and Co who specialise in offering guidance on branding, exporting and sales: www.forestandco.com