There’s never been a better time to trade internationally. Academic research confirms that exporting companies are more productive than non exporters, achieve stronger financial performance and are more likely to stay in business.
Read more about the benefits of exporting in UK Trade & Investment’s new ‘Bringing home the benefits’ publication.
Are you thinking tentatively about exporting, or keen to do business with international buyers but don’t know where to start? UK Trade & Investment (UKTI) recommends ten steps you should consider when starting out:
1. Review your export potential
Take some time to consider the realities of exporting and their implications for all aspects of your business and to be aware of any assistance you may need.
2. Develop an action plan
Exporting is a process, which needs to be planned. Clear and focused objectives are essential, and potential exporters should be realistic as to what can be achieved within a given timescale.
UKTI, through its regional international trade teams, can provide help to companies to develop a tailored action plan which sets out a workable strategy for developing international trade with regular reviews to ensure it is on track.
3. Research and prepare to visit the market
Researching markets is essential to help reduce risk and improve chance of success. This is usually a combination of desk and field research. Remember, each business and each market is unique.
Taking part in overseas events, trade fairs or missions is an effective way to undertake field research to test markets, attract customers, appoint agents or distributors and make sales.
UKTI helps groups of UK companies to attend tradeshows and missions worldwide (terms & conditions apply), find out more here.
4. Explore routes to market entry
Choosing a sales presence in an overseas market can be complicated. There are a number of options - agent, distributor, internet, license or franchise or alternatively, direct sales to retail, direct business to business sales, joint venture, subsidiary or via UK contacts. However, the suitability of each option will depend on your company and products.
UKTI can help provide market intelligence on your preferred route, establish whether you need a direct sales operation, or whether an agent or distributor is more effective.
5. Find out about selling and marketing your product overseas
It is important to consider how to market and sell your product overseas. There are a number of elements which make up the marketing mix to ensure competitiveness, including uniqueness of product, price, location and distribution channel.
UKTI and their overseas teams can help to adapt your approach to local conditions. You should also consider taking advantages of the growing opportunities to do business online.
6. Think about cultural and linguistic challenges
You may need help with the linguistic and cultural aspects of doing business overseas. Training company Steps Drama pass on their tips for meeting these challenges.
UKTI’s Export Communications Review offers companies a variety of options and advice, including cultural awareness reviews and communications planning.
7. Prepare to manage finance, payment and risk
Managing international risk is an important part of exporting. There are numerous categories of risk to consider, ranging from commercial issues such as non payment; insolvency and contract disputes to political risks such as government or legislative change and financial exchange and inflation rate risks.
Find out more about managing cash flow, receiving money and foreign exchange by watching this short UKTI film featuring HSBC.
UK Export Finance (UKEF) is the UK’s official export credit agency, providing trade finance and insurance solutions to support UK exporters. If you can’t receive the support you need from the private market, UKEF may be able to help.
8. Prepare to protect your intellectual property
Protecting your intellectual property across patents, trademarks, designs and copyright can be the difference between commercial success and failure.
9. Prepare to fulfil your orders and get your documentation right
It is important to know at an early stage which regulations and legal requirements must be complied with and which trading terms may apply, if done incorrectly consequences can be high.
Visit UKTI’s website for online Customs and VAT training.
For further information visit Her Majesty’s Revenue and Customs.
10. Choose a distribution method
Consider the implications of selling over long distances. The kind of goods you export, the level of demand and the type of costs involved can all dictate your distribution options.
UKTI can offer help and advice and you may also wish to contact the British International Freight Association.
Whereas every effort has been made to ensure that the information given in this article is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation and Skills, and the Foreign & Commonwealth Ofﬁce) accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned.