Trade

Exporting - Do you have it in you?

Do you know where your competition is? It used to be down the street not too long ago and then it went national. Today your competition is located half way across the globe. They are selling to your market. Are you selling to theirs? Small businesses who do not export are losing out BIG time. Let’s look at some of the top reasons why you should consider exporting:

• The domestic market may not provide your organization with further opportunity for growth; i.e. you are not growing fast enough
• There is a demonstrated demand internationally for your organization’s products
• Profit margins on exported goods may be higher
• If you are offering specialized products, then your domestic market may be very small
• Selling internationally allows you to develop capabilities and competencies and gives you an edge over your competition

Can you think of other reasons? Share them with us.

If you are a small business you can be as effective as larger firms, provided:

• You have a suitable product
• There is a strategic commitment to export

Your advantages

As a small business, you have an advantage of serving market niches. Large organizations may ignore this niche segment since it may not offer the greatest profit potential. Such segments can serve as profitable markets for your small businesses. If a product is doing well at home – it is a good sign that it will have appeal abroad.

The risks

However, there are challenges and risks associated with exporting. For one, the organization faces increased direct and indirect costs. These costs could be from both operations and marketing. Another challenge is culture. How do you sell without offending potential customers? This is very important. The perceptions that your export market develops for your organization can make or break the export effort.

Then there are all those government regulations; extra paperwork that needs to be completed, financing, credit terms, etc. Support is another challenge. How do you support your clients who are multiple time-zones away?

The plan

Export initiatives must never be undertaken without a formal documented plan. The first step in the process is to evaluate if your organization is ready to export. I will deal with the evaluation criteria in the next post on this topic.

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