When looking ahead to the new year, small business owners might want to dream big and look further afield to exporting. There are tremendous advantages to exporting; however it can be a minefield for first time exporters and small businesses. Where do you start when you’re thinking about exporting? Peter Stamps, founder of FD Business gives his advice and shares some tips for small businesses thinking of exporting.
Exporting can be lucrative. From music to motorcars, the UK has had its fair share of overseas successes over the decades. In fact, cars are still the UK’s largest export. But whilst the more significant categories are well known, it’s not just the shinier exports that do well overseas. What’s the secret to success? Hard work and planning – as always – are the clear favourites.
Success starts at home
Before you start getting carried away, are you sure-footed enough at home? It sounds rather gloomy, but your best bet for success is in your home markets, where you know your customers, your customs – and of course the language. If your business isn’t quite the success you are aiming for at home, it might not be advisable to head overseas just yet. Take the time to get your products or service performing well here, first.
Research, research and research
We cannot say it enough times. Research is vital to the success of any overseas operation. It might not be the obvious things, however, like the physical cost of taking a product to market in a new location. For example, Government policies can vary in some countries between regions, rather than simply by border, so it’s worth taking the time to research everything you can about your potential market.
Meet and greet wherever you can
The old saying ‘It’s not what you know, it’s who you know’ still rings true in many cultures globally. In addition to that, the particular nuances of cultures in new locations can surprise. For example, in some countries you must have a local guarantor, or you must be liked – and genuinely liked – before you have any opportunity to discuss exporting. This can be particularly true in the far East. Trade shows all over the world give you an opportunity to meet local business people, understand their interests, learn their ways of working and their customs; and to showcase your business in safe, managed environment.
It seems such an obvious statement, but you’ll need to take some risks in deciding to export. Managing those risks is the important element. You’ll benefit greatly from a trusted overseas expert – or even a few. While you might not want to set up an office in your first export country, you would be very well advised to ensure that you have advice on local customs, expectations and courtesies.
It goes without saying that there will be additional expenses to exporting, but with the right business planning, they should be factored into expansion appropriately. If you don’t yet have a business plan it’s most definitely time to make one and I’ve written before about how and why you should. For those seeking to export, a clear business plan sets out a framework for success that keeps you on-track within a new market.
Whether it be in your choice of market, your method of transport or in something else entirely, flexibility and creativity are the key attributes of an export expert. Business to business trade could be a better option, rather than spending a huge chunk of your budget on advertising to the public, for example. And, instead of looking at your usual customers, can you look elsewhere – at other businesses perhaps? Bear in mind that other locations have other seasons, which could affect your business – especially if you’re exporting umbrellas! Very British.
Launching your business into an overseas market can be incredibly time consuming and complex. You’re going to need all your energy and focus on the job at hand, so delegate wherever you can – particularly to experts and professionals. The government Department for International Trade offers useful guides online for finding experts to support those wishing to tap into overseas markets, including useful information about attending upcoming trade-shows and fairs.
Get your finances in order
Finances, tax and accounting can be daunting at the best of times. When you’re working out what type of shipping container can safely transport your hard work abroad, you might need someone else to take care of the financial aspect of just how much that container is really going to cost for the time you need it. you might need to consider whether you need to pay an import tax on the container, the goods within it, or myriad other financial complexities that you hadn’t the capacity to deal with. First and foremost, currency exchange will affect everything you do overseas. Picking a good accountant and a good bank is essential.
For help with any aspect of business planning, export finances, or general accounting please get in touch with us at FD Business.
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