Many companies will make the decision after a few years, that it is time to venture into international markets, whereas some dive in straight away after only a few weeks; but how can either of them know if they are ready to do so?
Many smaller companies do not build an export plan into their original strategy and so it when it does come up, the subject is more as an afterthought. It is really important that companies don’t make the leap into foreign territory without having done the research and preparation needed to be sure that they are completely ready to make the move.
Before you make this huge decision, read the tips provided by 4x Currency below to work out whether your company is ready to venture overseas or not.
1. Have You Got a Plan?
Before you even begin to pitch for overseas business, you need to make sure you have a plan that has a strategy in place for all eventual outcomes, both positive and negative. If your attempt to export does not work, you need to have a plan to turn it around, and if you do really well, you need to know how to deal with a sudden increase in demands.
2. Are You Financially Able?
You will need to have reserve funds ready if you plan to export, as there are many different costs to take into consideration. International clients may expect credit for longer than your domestic clients, and there will be administration costs and transportation fees too. To make this a success, it is a good idea to have loans accessible so that you make a heavy investment early on and don’t run out of money.
3. Do You Have Your Target Market?
Don’t even think about pitching until you have clearly identified your target market. Exporting will never work if you go in with the plan to target anyone and everyone in the hope that something will work. Do some research on the markets that you are interested in, and make sure you think about all the other factors that will hit you in that area such as local business protocol, local taxes and of course, entry requirement.
4. Do Your Management Agree?
Before making any sort of decisions, it is really important that your company’s whole management team back the plan and are fully on board. The likelihood is that there will be bumps along the way, but with a group of people backing your decision and helping out, you will be in a much stronger position.
5. What’s Your Price?
Instead of planning to transfer your domestic prices, think about how much your target customers will be able to afford. If you are going to be exporting your service or product to developing countries, then they will not be able to afford to pay the same prices as richer countries and you may need to drop your prices.
6. Is Your Product Required?
The last thing you want to do is enter a market that is already completely saturated with your product. Make sure that there is a genuine demand for your service or product in the area you are targeting and that the customer base you are going to be selling to will have a reason to buy it.
7. Can You Service Overseas Clients?
You are going to need to have the technical skills required to for overseas selling, alongside the appropriate customer service levels and after-sales support. If you cannot provide these in a foreign country, then you are going to find yourself stuck very quickly. With staff that have the skill-sets to meet all this necessary criteria, your business should go relatively smoothly.
8. Is Your IP Protected?
You need to make sure that all your international property and most of all your trade mark and branding is protected in the countries you want to do business in. If they aren’t, then any other local business can register your trademark and you will have to start from scratch with a full rebrand.
9. Do You Know The Law?
Believe it or not, your service or product could actually be illegal in some countries. Some governments will help out and protect foreign companies, but some will completely discriminate against them with the use of tariffs and red tape. Make sure you know that your business will be positively received in the market you are planning on targeting.
If you can answer “yes” to all these questions, and feel confident in those answers, then chances are that you and your company are ready to go abroad. You don’t need to be a global player to do business globally these days, you just need to make sure you know what you are doing and how you are going to do it.
Preparation is so important and doing all your research before you make a plan will mean that you have everything you need by the time to get round to making the jump.
Photo credit: U.S. Department of Agriculture