Giving your company the best chance of export success takes commitment, planning and research.I’ve been asked about this more often lately, as more WA SME’s seek to diversify and grow internationally.
Know your value proposition
First, you need to understand your value proposition. When looking at an international marketing approach, you need to be aware of where you can be successful in that market place with a particular product or service delivery.
Companies often need help articulating their unique selling proposition and support that with relevant marketing support
Consider your commitment
You also need to think about allocating an appropriate level of resources and time to achieving export success without materially impacting on your business.
This can vary from business to business depending on the product or service your company is exporting.
Fundamentally, it is about making a long-term commitment to having:
- A marketing and promotional plan
- An export development plan
- Defining unique selling aspects of the product or service
- Enough capital and human resources
- Understanding who is your target audience.
Know your product and your competitors
It’s important to be clear on the saleable attributes of the products or services that you want to sell into a particular market.
As well as understanding the cultural nuances of that market, you must be culturally aware of how to do business in that market.
Allocate time to find out as much intelligence about your competitors as you can.
This can include:
- The level of competition in the market
- How long they’ve been in the market
- Their unique selling points
- Where they have them come from to be in that market place
- How they go about marketing is it B to B or B to C.
- What their channel entry approach has been
- What you can garner about their reputations, both at a consumer and trade level.
This information will put you in a better position to refine:
- Your product or services offers
- Pricing strategy
- Promotional strategy
- How you will deliver your product into that marketplace, i.e. through traditional channels or e-commerce and online shopping platforms.
When choosing where to export, it’s always important to think about import tariff regulations.
You need to be thinking about the countries where Australia has a Free Trade Agreement (FTA). It’s through the compilation of bilateral and multilateral FTAs that Australia has consummated with many countries over time that you can get a competitive advantage by leveraging an FTA.
It also helps to understand if there is already consumer or market awareness about your product or service as ‘brand Australia’ resonates very strongly in the export arena. Understanding that Australia already has a reputation, whether it is clean, green and quality in food and beverages or whether it is a pedigree we have in the delivery of mining and METS technology, we can leverage that to help make that entry point.
Estimate your profits
You already know your domestic profit, so working out your export profit requires a similar exercise.
By understanding the import, distribution and freight costs, you are able to determine and indicative price point range that your product will be once it’s landed into that market, if we are talking about products. To some extent, it’s the same if we are talking about services.
You can then understand the competitive market price and work out what the indicative margin will be.
That becomes a very important fact in determining why you would go to that market in the first place.
There is no point going into an export market where you are not going to make money, or you are going to make more money doing it domestically.
You definitely have to be passionate and committed about exporting but there are many more facets to it such as looking at your pricing, market positioning and marketing support to develop your business base internationally.
Finding the right partner or buyer is critical to ensure your brand is protected and nurtured in your new export market.
Remove the roadblocks early
Some of the common roadblocks are understanding who to talk to in the market you want to target, how you know they are the type of customer or partner you want to do business with and how you qualify that.
This is where the Chamber of Commerce can assist through its international network, the work we do with the Australian Trade Commission as well as through the WA Government trade offices.
We assist companies to navigate that path of better understanding the type of customers or partners they want to do business with.
There are other common roadblocks such as complex importing requirements around packaging or labelling.
They are all able to be overcome by taking a very strategic, systematic and measured approach to looking at the market place.
How much and how long?
It depends on the product or service and on the market. I’ve certainly found it can take up to 12 months to reach the initial export success.
It can be shorter, but it is certainly not a quick win as becoming a successful exporter requires a well thought out plan and engagement journey.
A lot of the up-front cost is in developing the export marketing material and the trips overseas to build those valuable relationships. The people to people relationship building is everything to building your international business for the long term.
It is not a one hit wonder and building the relationships takes time and effort but is a crucial investment by your company.
Depending on the level of commitment and the size of the company, it is difficult for me to say how long and how much that would cost but certainly there is the ability to draw on the Federal Government’s Export Market Development Grant (EMDG) to assist in that.
Michael Carter is the manager of CCI’s International Trade and Investment Centre.
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