Business Toolbox

Volatility, geopolitical tensions and supply chain disruptions are now defining features of global trade, and businesses are being urged to plan accordingly.

CCIWA Head of International Trade Services Michael Carter said it was no longer a matter of if your business will be affected, it’s when and by how much.

“These conditions can impact your bottom line and more so, impact how you go about market selection, market entry and market engagement,” he said.

“Where you have trade policy uncertainty when rules are unclear, investment tends to wait, markets hesitate and growth slows.”

Beyond our backyard

Carter said three world events in the past six years have had major impacts on trade: the “health war (COVID-19)”, the “tariff wars (between the United States and China)” and now the “energy war (Middle East crisis)”.

“All had significant impacts on the US dollar, trade relationships and certainty,” he said.

“This time, we’re seeing both global gross domestic product and global two-way trade value trend upwards, which is positive.

“Despite the challenges, there are still significant opportunities for WA businesses which take a strategic and informed approach.”

The impact is being felt by exporters and importers, particularly where businesses rely heavily on a single market, supplier or logistics pathway.

But WA exporters and importers are well positioned to navigate uncertainty – if risk is managed strategically.

Market selection – it’s more than opportunity

While expanding into new markets can reduce exposure and diversify risk, Carter said businesses needed to look beyond market size and demand.

“Market selection must balance commercial opportunity with risk exposure; not just market size,” he said.

Businesses should assess:

• Regional political and economic stability
• Regulatory, legal and compliance requirements
• Logistics capability
• Payment and financial risks
• Competitive saturation
• Cultural considerations

For example, a market may appear attractive commercially but prove difficult operationally due to logistics constraints, complex regulations or strong local competition.

“You can never do enough homework; you can never do enough analysis,” Carter said.

“CCIWA’s International Trade Services team has diagnostic tools to help you make decisions based on facts, not folklore, so you can navigate trade with confidence.”

Free trade agreements can improve competitiveness

Free trade agreements (FTAs) are one of the strongest tools available to Australian businesses looking to improve market access and reduce costs.

Australia currently has 19 FTAs in force, covering many of WA’s key trading partners.

“Free trade agreements are all about improving market access and creating competitiveness for exporters,” Carter said.

READ MORE: Explore the benefits and requirements of FTAs

Market entry – compliance mistakes can become costly

One of the biggest risks for businesses entering new markets is getting compliance wrong, especially when utilising FTAs.

Errors in customs documentation, export controls, contracts or intellectual property protections can lead to delays, penalties or commercial disputes.

“Whilst everything is all great in the beginning … when things may go pear shaped, that’s when everybody is scrambling for those contracts or documents,” Carter said.

Businesses should review:

• Commercial agreements
• Distribution contracts
• Export documentation
• Intellectual property protections
• Insurance arrangements

Businesses are advised to seek legal and trade advice early rather than after problems emerge.

READ MORE: Guide to export documentation and certificates of origin

Market engagement – relationships still drive international business

Despite the rise of digital trade platforms and online engagement, Carter said successful international trade still depended heavily on relationships and cultural understanding.

“It’s important to have an export plan – plan the work and work the plan,” Carter said.

“You need to understand your product, where it will have an advantage and how you can develop the business.”

An export plan should include:

• Business overview – company name, sector, core products/services, unique value proposition
• Export objectives – target revenue or growth goals and strategic purpose, diversification, market expansion
• Target market – top one to three countries and market rationale
• Market entry – distribution channels, partnerships, milestones and success metrics
• Marketing and promotion – key activities (digital, campaigns, trade shows, local representatives) and brand positioning

Invest time to understand:

• Local business culture
• Communication styles
• Market expectations
• Decision-making processes

“Cultural literacy cannot be emphasised enough. You need to understand your target market, ensure you are respectful and aware of any cultural nuances,” Carter said.

“Relationships are crucial. For many cultures, doing business is about collaborating for mutual benefit, rather than focusing on numbers.

“This is particularly important when selecting distributor partners – choosing the right partner can directly influence long-term success.”

When choosing a distributor, businesses should assess:

• Market reach and customer networks
• Industry experience
• Marketing capability
• Commercial transparency
• Cultural fit

Trade shows still matter, but preparation is critical

Trade shows and trade missions remain valuable opportunities to build networks and generate leads, but businesses need clear objectives and follow-up strategies.

When attending trade shows:

• Research attendees beforehand
• Schedule meetings early
• Prepare marketing collateral and pitch materials
• Follow up consistently after the event

Managing financial and payment risks

International trade also exposes businesses to payment and currency risks.

With the Australian dollar fluctuating significantly in recent months, businesses may see profit margins quickly erode if exchange rate exposure is not managed properly.

“You might lose all of that profit just because the Australian dollar has gone against you,” Carter said.

Businesses should review:

• Currency risk management
• Insurance coverage
• Payment methods
• Incoterms responsibilities
• Letter of credit arrangements

Early discussions with banks, freight forwarders and advisers can help businesses avoid costly mistakes.

READ MORE: Managing trade finance risks – currency, credit, capital and cash flow

What businesses should do now

CCIWA recommends businesses involved in international trade:

• Review supply chain exposure and market concentration
• Assess alternative or emerging markets
• Audit export and import compliance processes
• Review contracts and payment arrangements
• Ensure intellectual property protections are in place
• Strengthen cultural capability and relationship management
• Develop a clear export or international engagement plan

If you are looking for support or advice in business, investment or trade, contact our experienced International Trade Services team at [email protected] or 08 9365 7620.