How to get started in exporting your product
A THERE are many reasons you might be thinking of exporting; increased profitability, opening doors to new markets, growing the business. Every market is different and if you want to expand your business overseas, it's important to plan for issues such as cultural differences, new currencies, pricing and the possibility of big competition.
Research: In-depth research is essential before you begin exporting overseas. Firstly, consider what countries might prove the most lucrative for your business. Then build a research checklist to determine the best market. Questions to ask include : What are the local customs? Do I need an export licence? Are there cultural, administrative or economic barriers to success? What taxes and duties will be charged? Are there legal packaging requirements? Read up on recent import statistics, economic data, and competitor prices. There may be subtle cultural differences that could prove vital to the success of your product.
Start small: Before you start thinking about global domination, focus on one or two markets. Begin by targeting markets with conditions in your favour (cultural similarities, demographic, competition and infrastructure etc). Also, before you begin thinking of exporting, make sure you have registered your trademark and your intellectual property is protected.
Make a plan: Draw up an export business plan outlining your path to growth. Questions to ask include: Where will my product sell? What's the profile of my target market? How will I manage distribution? Do I need to make any changes to my product? What does the competition offer? You may need to change your product specifications and review your pricing to cover costs such as shipping, overheads, local taxes and duties.
Pick your channels for distribution: Carefully research your options for distribution and work out who will take responsibility for each stage of the product's journey from you to the customer. Using a distributor might be a quick route but you could lose control over your sales, marketing or customer service. You could also use an export agent who will travel, handle logistics and make contact with buyers. They earn a commission on any sales and it can be a relatively easy way to enter the export market.
Manage risk: Talk to your bank about getting a 'Letter of credit' to ensure you will be covered for any late or non-payments. Despite good intentions there may be communication problems, political unrest or other issues that could delay payment or even put you out of business.
Foreign currency: Research the local currency and consult with experts on the impact of currency fluctuations on your business. Consult a foreign exchange advisor or an accountant on how to mitigate your foreign currency risk. Many small businesses that export agree a fixed rate at the point of sale, protecting them from currency fluctuations, and this can be key to your success.
Get support & Grant Aid: The Irish Exporters Association can be contacted on 01 6612182 or log onto www.irishexporters.ie. Enterprise Ireland supports the development of manufacturing and exporting services and run programmes to support export. You can contact Enterprise Ireland on 01 7272000.
I run a small, successful manufacturing business and believe that I have the ideal product for the export market. Can you give me some tips on how to get started?