Samir Lambay, CEO, FreightCrate Technologies
Expanding markets beyond borders of a country is in essence an important step in the expansion of business activity level and meeting the growth goals of business. The fundamental aspects of business that enabled the domestic growth hold true for the international business too but with additional factors. The key additional factors that can enable the business successfully venture into exports can be categorised as:
- Business opportunity
- Regulations and regulatory environment – both of the county to be exported to and from where the exports are being done [trading activity related)(a.) At business level (b.) Product level
- Logistics of exporting
- Export process – documentation to physical delivery of products at its destination
- Where to export
Knowledge of target markets is absolutely vital. Do a desk research from known sources looking for data which will give you a definitive sight of the potential new market and its opportunities. Look for demographics, social, cultural, economic indicators, practices and potential competition (from both within the target market place and other providers). For this, you can connect with your local trade associations, chamber of commerce of your industry and the commercial section of the consulates of the potential market.
- Export plan
Putting together a plan for export requires the whole organization to contribute. Whether it is a test export or your long term export order, the internal capabilities of your various teams need to be synced to deliver to the stringent norms and expectations of the market place. The key components within your plan should include
Do you already have team members who can lead your export initiative [past and relevant experience, understanding and knowledge] or do you have to hire someone new? You do not want to experiment with your export orders in the hope that you will learn as you start doing it.
How will you meet the market demand of the new market – quality, quantity, trends, design, technology etc aspects by which your product can distinguish itself in the market place. Can you handle the cyclic fluctuations and your back end supply chain to meet speeded up orders?
Here the regulatory aspect kicks in terms of requirements for how the goods need to be packaged. Label requirements, language, design aspects, choice of packaging materials – essentially the regulatory aspects that define how the potential market requires the goods to be made available. Environment and pollution norms are a big factor today and any solution / edge that you can demonstrate in your packaging will give you competitive advantage
- Building up the execution plan
A first-hand knowledge of the target market is important. Not only to learn about it but also to showcase your products. Plan to visit trade fairs, events and build new contacts who can support your product introduction.
- How will your sell in the potential market?
The route you choose to make your products in the potential market will dictate how your structure your home export operations to support the market. The choices available are –
- directly self-sell – by setting up a representative of your company
- take the distributor route – this method provides certain advantages specially when local distribution is a key aspect of your success
- use an partner / agent – set up relationships with local leaders
- set up joint ventures / local set up – this decision is more often driven by your product dynamics, cost of production, proprietary technology etc. And incurs a high investment
The model you choose needs to take into account how the delivery [end to end shipping] will work and how the commercials are structured and guaranteed. Involving your Finance team & legal team [to protect trade-marks, patents, technical know-how]put together the commercial model and assessing your logistics costs is imperative to your financial success.
- Market assessment and convert opportunities
Your potential market buyers or partners or agents can be found and relationship built thru participation in trade fairs, conventions and exhibitions. Even if there is none that matches your industry directly – you can find one that is ancillary one. Check out with chamber of commerce, association of industry and Export Promotion Authority of India who promote this participation and also subsidise the cost of participation for exports.
- Market reach – communication & connections
Your website is a first choice for any-one to know more about products. Fine tune it towards the potential market – including language option. Increase and make use of professional social media channels like Linkedin, Twitter etc to share your export plan, availability, potential partnering opportunities and build a network. The need is to make it easy for the potential client to reach you – your representative who can provide timely and correct information.