Robin Godfrey of the BCC provides advice on how businesses could exploit growth opportunities overseas during the recession.
The treasury forecast in its pre-budget report that growth in the UK’s traditional export markets of Europe and the US will slow. With the economic and political uncertainty at present, many companies are very concerned about their future. However firms are being encouraged to look overseas and seek out opportunities. Whilst the falling rate of the UK pound should not be celebrated, there are advantages to be gained by companies wishing to export further afield. However the whole area of exporting exposes business to new risks. Taking on a new market can seem an exciting prospect but businesses must ensure they do their homework first to mitigate this risk. There are a range of issues that can trip businesses up when looking for new opportunities overseas such as local legislation, cultural differences or competition from other markets. These must be thoroughly explored and understood. There are 10 key tips a business should take to make the difference between success and failure.
1) Take control of your export strategy and stay in control
Make export sales a part of your business strategy and include a plan to develop exports over a five year period. Stick with the plan.“Companies that research an export market thoroughly go in with their eyes open, fully aware of the opportunities and potential pitfalls. If you don’t do this, you can keep trying and failing without ever knowing the reasons why”, comments Managing Director Dr. Peter Sheard of Trend 2000, a leading manufacturer of polymer composite products.
2) Select markets wisely
Choose the markets yourself - do not have the markets choose you! Agents and distributors that approach your company offering to represent you are acting in their own best interests to expand their businesses not yours! Potential export markets can be plotted on a two dimensional grid allowing you to select those most appropriate to grow your business.
3) Be serious about the market
Plan for a presence in the market not just to find one or two customers.When faced with a potential business development opportunity in Romania, Indigo Brave, a professional development training company, had two choices. It could grasp the opportunity with both hands or could take the time to investigate the opportunity fully. Luckily the company chose the second option.
4) Develop a market entry strategy
Think about what you are going to have to change in order to be successful in the new market; adapt the product, set a pricing strategy, choose a route to market, position yourself competitively.
5) Know what you don’t know
Undertake marketing research - be very clear about the information you need to find out in order to make the decisions listed above.East Midlands based Spraylat saw a potential opportunity in Finland and were keen to find out the potential size of the market place and to determine factors like product pricing, distribution, competition and legislation. Marketing research played a key role in the company’s decision making process.
6) Do your homework
Leave no stone unturned in your pursuit of knowledge about the market, visit the critical websites listed on BCC’s Surfing without Drowning pages, speak to people in the know.
7) Visit the Market
Arrange to have meetings with a broad cross section of players in the market place and discuss the way they do things now (find out about your product, select a supplier, purchasing behaviour, experience with existing suppliers).Manufacturer Sigmala’s visit to the USA turned out to be a catalyst for transforming the organisation. Lee Fenney, Managing Director explains, “Had it not been for the research interviews, we never would have come up with our new concept, which promises to catapult us into a new phase of development”.
8) Analyse rationally and objectively
Be strategic (again), stay in control (yes again) - analyse the findings at leisure when you get back to the UK not while you are out there; tempting though it might be, do not make the important decisions about the market until you get home.
9) Communications
Review how your messages are being communicated to the export world. Read your literature with the eyes of someone where English is a second language – is it easy to understand and to follow? Is your website set up with foreign (even US) key words?London College applied to the Export Communications Review. Margaret Arokiasamy explains: “The communications review is a great way to help you take some of the risk out of expanding internationally. I feel that if we had not implemented the recommendations of the review, we would have gone out of business. They were that important to our success internationally.”
10) Help is at hand via the BCC
The Export Marketing Research Scheme and the Export Communications Review are two schemes managed by the British Chambers of Commerce (BCC) on behalf of UK Trade & Investment. Together they provide advice, funding and the encouragement to follow these simple tips to successful market selection, entry and business growth overseas. Soundalive Managing Director, Malcolm Dexter-Tissington comments: “The scheme performs a valuable role by ensuring that companies such as ours can investigate a potential export market fully before making any long term commitments”. For more information on how your business can successfully export, contact the team on +44 (0)24 7669 4484 or email emr@britishchambers.org.uk.
