Exporting is a vital source of economic growth for the UK and SMEs account for over half the value of UK exports.
In many cases businesses that export their products and services overseas grow faster and do better than those that don’t. In spite of this and the Government encouraging more international trade, many businesses still don’t start to export because of a ‘fear of the unknown’.
Exporting is not as difficult as you might think and there are many methods to improve and increase a business level of export sales.
It’s only the unknown that’s challenging, but you just have to go for it and do it. In any economy, new geographic markets offer businesses opportunities to create new revenue streams – and studies reveal businesses that export are more productive and employ more people. Expanding into international markets can seem daunting so here's a “how to” which contains various tips and advice for reducing the risk and increasing the export opportunities.
How to improve export sales
1) Make exporting a part of your overall business strategy.
Your export strategy should be based on an assessment of your own position and research into promising opportunities. You will need to think long term about how to reach new customers and finance your exports, as well as making sure you understand legal and tax issues.
2) Carefully assess each of the markets you are considering entering into.
Expanding into new markets involves a great deal of market research in addition to target customers. When going into international markets, businesses need to be aware of the different cultures. Clearly defining your market may seem like a simple step, but before you identify who you want to sell your product to you must understand their needs. You'll want to consider:
- Common interests or needs of your target customers.
- Market growth rates
- Forecasted demand
- Potential barriers to entry.
2) Start with easier markets.
Most small and medium-sized enterprises (SMEs) – whether young or established, would be wise to consider markets outside of the UK. Yet knowing where to start and how to do it can be challenging as it very much depends on the sector you’re trading in and what your company is looking to achieve in the short, medium and long-term.
Traditional methods in the UK involve starting with mature markets close to home, such as Ireland, France or Germany. Once you have developed a strong network of of partners, and gained experience, you can then work up to more difficult markets, such as Brazil, Russia, India and China.
3) Do your research.
Research new territories. Be thorough in your pursuit of knowledge about the market you are entering. Visit websites, subscribe to publications and read reports - you need to know about issues such as logistics, order fulfilment and customer service and remember - what works in one country may not work in another.
4) Once you’ve done your desk research, visit the country.
Be prepared to travel and be prepared to hop on planes at short notice to meet people. Working with affiliates, partners, distributors, licensees or agents can help you get established in a new market.
A great way to develop export sales overseas is to find partners by being there, in the marketplace and at a trade fair.
- Talk to people buying similar products
- Go and buy a similar product yourself
- Go to trade fairs and seminars and talk to potential customers.
- Learn local customs.
Overcoming issues such as cultural differences, language and health and safety regulations, levels of formality & business etiquette can help deliver vast improvement to your export sales.
5) Seek help.
If you're considering exporting or expanding into international markets speak to one of our accountants in Hull, we have strong international taxation team who can help you. Don’t think you can do it all yourself. Talk to consulate offices, banks and chartered accountants with good international connections.
6) Check your prices.
Strengthen your export business by checking your prices. Pricing is not just about understanding currency differences - you need to research price levels in each new territory. Your overheads may also be higher so ensure that your prices take into account the cost of freight and transport, packaging and agent's commission.
Export can be improved with great timing. In some places, what you sell may be ahead of its time, in others it could be seen as outdated.
8) Don't Overlook the Many Government Resources.
Why go it alone when both the state and federal governments offer initiative to boost export sales or products and make your efforts more successful? Companies which begin to export experience significant gains in productivity and competitiveness.
Alternatively, If you're considering exporting or expanding into international markets speak to one of our accountants in Hull, we have strong international taxation team who can help you.