Going global is a big step for many companies who are only familiar with their domestic market. It is important for the health of your business to really know why you want to export. On average, it takes about a three year commitment to establish a presence in a foreign market. This will require the resources of people and finances during this developmental period. Checking the feasibility of the venture is an obvious exercise before you go global.
You may want to examine whether your interest in exporting is market driven, or product/service driven. Here’s the difference...a market driven entry would look at “what the foreign market wants, and how you will fulfill that need”. A product/service driven entry would be, “here’s what my company offers, now let’s find sales in a foreign country”. The common link is that both require feasibility and a lot of resource planning.
A recommended first step is an Industry and Company Diagnostic evaluation of your business or current resources. If this confirms your commitment to export development, proceed with the next step, the Export Business Plan. Prior to spending a tremendous amount of research time on developing your export plan, the diagnostic will help you evaluate whether your objectives for exploring foreign market will be satisfied and whether the risks of the venture are truly worth the returns.
Should your diagnostic confirm your firm’s export readiness, then proceed with the export planning process. The Export Business Plan will evaluate the country risk, the target market(s), the demographics, the market demand and needs, the currency and commercial risks, the legal aspects, the logistics of delivering the product or service, and of course, the financial implications involved in an export transaction.
Industry and Company Diagnostics:
Knowing your industry is important for the present and the future. In the Industry Diagnostic, the items to examine are the current trends and the growth potential of your industry. A declining industry, a highly competitive industry, or a saturated domestic industry may motivate seeking growth potential in markets abroad. In the Company Diagnostic, it is extremely important that you know management’s commitment to exporting, available financial and human resources, and production capabilities.
A. Industry Diagnostic:
- Describe your industry
- What are the industry trends: growth, decline, stagnant, saturated, increased competition?
- How does the industry overall measure in the global marketplace? i. e. What percentage of the industry output is exported (increasing or decreasing)? How competitive is the industry in the international marketplace?
- What is currently exported from this industry, and to where?
- What government and association studies have been developed for the industry? (Foreign and domestic)
B. Company Diagnostic:
- Give a description of your business in terms of history, ownership structure, growth pattern, staff numbers, number of points of service, etc. over the recent years.
- How well does your small business compete in your industry?
- What are your goals and objectives for considering exporting? (An overly competitive domestic market, a surplus of product or production capacity, need for exchange of new ideas and technologies, a “hot” market, greater economies of scale?)
- How financially stable is your company at this time and the foreseeable future? International business may mean additional costs and delays in cash flow.
- Evaluate your staff for international experiences and capabilities? (i.e. languages, foreign travel, contacts, education). Can staff be assigned to the exporting project? What additional support will they require? (i.e. budgets, equipment, training, management commitment). To what degree can the organization accept change (going international)?
- How much can your plant produce or your company service in a given time frame? Can you keep up with foreign demands, without sacrificing any domestic business? How reliable are suppliers and methods of transportation? What contingency plans are in place if a disruption occurs?
- What external expertise such as other suppliers, freight forwarders, customs brokers, international lawyers, accountants, banking divisions, consultants, and other international support organizations, will you require to supplement internal skill deficits?
Upon completion of your diagnostics, you will have a good view of your company’s ability to achieve the goals and objectives for international trade; expanding your markets, acquiring new capabilities, improving profitability, and exploiting new opportunities. If favorable, you should now be able to proceed with your international business plan.
Getting to the Right Stuff: Getting the right information for an international business plan is readily and freely available online with excellent information resources and service.
The Export Source: Export manuals which may be of assistance in your research can be found at your public library and World Trade Centre in the earlier days are now available online. These are annual directories and reference materials that offer a multitude of data to guide and inform you about the target market. Ask your librarian for any additional resources available. e.g. Europa, Kompass, Exporter’s Encyclopedia, International/ Country Yellow Pages, etc.
Maximum information is available online including the books stated above. Google search enables you to search mostly everything online whereas many other useful links have been provided. B2B (business to business) and B2C (business to consumer) websites can also be big potential customers for your products/services.
Putting Together Your Business Plan
Templates for business plans are freely available online.
Putting Your Plan into Motion
Upon completion of your business plan, you should have a much more defined picture of what your overseas venture will entail. Your decisions and your implementation processes can now be plotted using the information you have gathered and the analysis you have made along the way. You have done your homework, examined the options, done your due diligence, planned your strategy, and now it is time to put your plan into motion.
For further assistance in the implementation stages, you may wish to consider the intermediaries available to help you through the mace of technical issues. Among these intermediaries is a knowledgeable and experienced team of industry and export specialized individuals who can be made available through us. We can assist in trade-related services to active and potential exporters. We provide services to businesses to help them achieve success in global markets using our expertise and that of our associates. Services include:
- Export readiness assessment;
- New exporter training;
- Export counseling;
- Export opportunity identification;
- International marketing assistance;
- Export financing and insurance;
- Technology transfer;
- Investment attraction.
All the best.