Why should your business export?
It’s a big world out there and, according to the OECD (Organisation for Economic Co-operation and Development), one in which export growth will increase.
A global middle class is set to grow to 5 billion meaning your business has a potentially global customer base. With the UK government launching its Export is Great campaign there has never been more government-backed support for startups looking to export.
Countries like Germany, France and Belgium may have been export hubs for British businesses for years, but with 100 million customers in Central Europe and an import market worth £500 billion it is not too late for your business to benefit.
If somewhere more exotic appeals, UK exports to China have grown by 52% since 2010 and UK exports to Brazil in products alone hit £2.4 billion in 2014.
If you decide that exporting is for you, then how do you go about it? Take a look at our 7 tips to consider before you export.
1. Research your market
Research is key if you want your business to succeed abroad. You will need to do everything you did when you sold in the UK – research your target market, your competition and your niche.
On top of this, you will need to understand the culture of the country you’re exporting to. For advice on market research and much more check out our essential guide to starting a business.
There are plenty of tools available to help online via the UK Trade and Investment website, including a country-by-country guide to exporting. Attending trade fairs and missions can also increase your knowledge of target market. Be sure to research what events are happening in your area.
2. Consider the legal, financial and cultural differences
You will need to be aware of any tax or legal differences that could impact your business. This could mean making a minor alteration to a product to fit with trading standards or making sure you are paying tax correctly on transactions. When selling abroad there are tax implications that need to be considered especially around paying VAT if you are transferring goods out of the UK.
Tax help can be found via the HM Revenue & Customs website. It is a good idea to contact the UK embassy in the country or region you intend to export to for information regarding exporting.
3. Is it financially worthwhile?
After your research and review process, does the opportunity still represent a good business opportunity? Make sure that this is something your business is capable of in terms of finance, production capacity and time. Above all else make sure that your business can achieve a good ROI (return on investment).
4. Make sure your business is secure
Protecting your product or ideas is vital at all times, but especially in a new market which you may not fully understand yet. Ensuring that your intellectual property is safe from potential competitors or fraud is a must-do. Take a look at our blog on how to protect your business.
5. Be prepared to adapt to the new market
Follow up on any research you have done and don’t be afraid of altering your product to gain sales among your new target audience. Your customers’ personal preferences will not be the same as they were in your home market. McDonald’s as a brand is well known for using different ingredients depending on which country its franchises are in, right down to having completely different products in certain regions.
Make sure you think how new customers will consume your product or service – do they have different needs? Does competition in your chosen market mean you might need to tweak your product for legal reasons or simply to make it stand out?
6. Write an export plan
UKTI advises that you should write an export plan for each new market. Similar to your business plan it should cover straightforward things like your marketing strategy, your distribution plan, your business model and your budget.
Getting your goods from A to B will more difficult in a potentially unknown country. Working through existing local distribution networks is one option. This can be approaching existing retailers or service providers to offer your product or service.
7. Customer support expansion
Customer support is also an area that your business will need to have a solution to in your export plan. Remember that selling abroad will thrust your customer feedback into the 24/7, global world. You may need a solution to responding to customers at unusual times of day. Customers will act differently in different reasons so be sure to research your target audiences so you are able to support their needs.