Make sure your business is in a position to explore and leverage potential markets
It’s vital that your domestic business is robust enough to invest in new markets exploration. Much like the prospect of introducing a baby to an already strained relationship, a new export market can put a considerable pressure on a business in its early stages and despite the promised benefits it shouldn’t be considered as a way of fixing a failing business. Some markets can require lots of time to research or network and this can be costly in terms of investment.
Many Middle Eastern markets, for example, require direct commitment from suppliers and this will inevitably either involve regular travel to the region, maintaining a local office or representative to meet with clients. It’s a market that we have found to be very rewarding, but also one that rewards proper investment and market understanding from its importers.
Don’t be frightened of cultural differences
Whilst cultural difference can be intimidating at first, the process of researching these is much like that of investigating new UK markets. There is a lot of help to be found for most markets, whether its UK-based assistance from the likes of UKTI (UK Trade and Investment), more specific sector-focused organisations such as the BSIA (British Security Industry Association) or more localised help from regional partners or government agencies. The practises of doing business can vary from region to region, but good research before any initial contact will prepare your team and business for these.
You might have to tweak your offering to appeal to new markets
Markets in different parts of the world can have varying requirements or needs that could require you to change product features, pricing, specification or marketing materials to fit. This could be down to cultural differences (some product features are required in some regions and not others where they could be seen as an expensive and unwanted addition), the financial situation of the potential market (some regions require lower-priced or simpler products or services due to the local economy and requirements), and language requirements could involve translation needs (especially when other alphabets are in use for example!) Products and services which fail to match these will struggle to make an impact on local markets.
Make sure your legal documentation and protection is in place
Before you enter a new market its essential to ensure that that you have got all your legal protection in place. This includes agreements/contracts but also trademarks and patents that are in place to protect your offering and intellectual property from misuse or corruption.
Make sure your invoicing and payments systems are firmly in place
There are naturally financial hurdles to cross with any new market. The obvious potential issues are local taxation laws and currency changes, but you also need to ensure that invoicing and payments can be easily performed and that you understand any banking, taxation or financial regulations that could affect your local trading as well.
Prepare to be flexible
Just because you believe you have the best product/solution, don’t expect the entire new market to accept your proposition automatically. Sometimes you will launch into a new market and immediately find traction with customers, but often it will be a case that you need to finely tune your offering to match requirements and this can take a while to produce the desired results. This is where help from localised partners can be especially useful in determining the best approach and ensuring you engage the market successfully.
Don’t expect results overnight
Entering a new export market should be seen as a long-term commitment and patience and persistence are essential. Launching into a new market and fine-tuning your offering to increase market share is resource-intensive and will require finding the right local contacts to work with. You need to be careful to find the right local partners (not automatically working with the first company that shows an interest) and to think long and hard about any actions (such as exclusivity agreements) which limit your access to that market, even if they appear to offer attractive inroads.
Whilst my advice above is designed to help you avoid some of the pitfalls of seeking and entering new export markets, I should also stress that the potential opportunities of selling into the right market often completely mitigate any risks. Simply selling your offering to your domestic market can make sense for many businesses, but when there is an opportunity to diversify the geographical dispersal of your customer base it’s an excellent opportunity to avoid the risk of operating in a single market.
Much of the process of entering a new market is common sense and will require a similar new business skill set to the one you will have used to grow your business in the home market. When you do come up against less familiar challenges it is the perfect time to find the right local partners who will be just as keen for you to grow their business along your own.