Exporting has been proven to be a profitable way of expanding a business, assisting companies to secure international markets and achieve foreign direct investment.
For many, exporting is a natural progression for small businesses looking to take on the world.
While it is a commitment that requires large amounts of time, money and dedication in order to successfully conquer new markets, it is a worthwhile business initiative.
Austrade research shows that on average, exporting companies are more profitable than their non-exporting counterparts. For businesses that are considering exporting, they need to consider whether they are ready for this journey, and to be sure the whole process from beginning to end is understood.
Business Gold Coast has compiled a list of five checkpoints to ensure local businesses know what they are up against, and to provide a clear path for those wanting to break into new and emerging overseas markets.
1. Ensure your product or service is able to be exported
In order to establish a flourishing international business, you need a product or service that is unique, innovative and in demand in overseas markets. A business firstly, and most importantly, needs to consider if export is a suitable growth option and whether it is able to dedicate the time, money and commitment necessary to support and sustain expansion opportunities.
The number one driving factor of export sales is customers – do you have ready customers overseas that already know your product, or do you need to educate the new market about your offering? Whatever your answer, you need to ensure there is demand and that you can achieve your target price and make a profit.
Meanwhile, businesses need to consider the logistics of their products and must ask themselves if their product can be shipped securely, on budget and in time, all the while meeting the regulations of that country.
2. Ensure your product or service export is sustainable
Now you must check if you can meet market demand competitively, securely and consistently.
To export successfully you will need to research a range of issues relating to exporting including how foreign markets operate. It is important that all businesses that are considering export as a growth opportunity uncover whether they can compete with local suppliers in that region on price, quality and differentiation.
It is also important that businesses can scale up and supply consistent large volumes of its product or service, while maintaining a commitment to quality. This also includes working to mitigate the risk of intellectual property theft, and impeding competitors from replacing your product or service with theirs.
3. Entering the market or region
There are a number of paths you can choose when breaking into a new market. They include:
- Wholesale arrangements such as distributors or agents. While most Australian companies rely on agents or distributors to represent their business in international markets, the two can often be confused.
- Direct to customer, such as a retailer. If you supply locally to major retailers, you might be able to supply to similar retail majors overseas.
- E-commerce – businesses now have the opportunity to export from their website or through a third party platform like Amazon, Rakuten or TMall.
Other options might include opening an office, or manufacturing under a licence or joint venture.
4. Implement your export plan
By implementing a tangible exporting plan, businesses are able to easily communicate with key stakeholders including bankers and governments, while recognising strengths and weaknesses.
It is recommended that a business has a dedicated person with time to commit to learning, communicating and implementing an export plan. This will include international travel, trade shows, late night and early morning calls, emails and working through some often tedious tasks of freight documentation and product registration.
This staff member will need to know the market intimately and will have the capabilities to sell to customers there. This means they need to be familiar with local business practices and the culture of the country and industry you are selling to.
It is also important that you establish a product that can be adapted to your export market’s needs and expectations – it might be as easy as repackaging, or as complex as reformulating products.
5. Be proactive
Are you familiar with the support the City of Gold Coast and Austrade provide through their trade facilitation services?
It is crucial you align with agencies that have knowledge and expertise in the area, and that are able to help you on your exporting journey.
The City of Gold Coast works with industry to deliver export training for aspiring and current exporters, small and large, and is always on the look out to support and mentor businesses looking to expand their horizons.
The City of Gold Coast’s Emerging Exporters Program assists businesses to develop export capabilities and take their products and services to international markets. In addition, new businesses are able to best optimise their export expenses and claim up to 50% back through Export Market Development Grant (EMDG).