Has your domestic market become too narrow? Do you want to spread your commercial risk over a larger territory? Or do you think that your product or service is perfectly suited to an international audience? In this case, the time has come to cross borders. As always, you will have to be well prepared to succeed. This simple step-by-step plan provides an overview of the elements which will make the success or failure of your export project.
1. Review your current situation
Self-knowledge is the first step toward wisdom. Although you clearly have a good idea of how your company operates, it can always be useful to put at least the following aspects down on paper:
- funds available
- risk management
- export management experience
- language knowledge, intercultural skills and employee knowledge of the market
- services/products eligible for export and why
- production capacity flexibility
- logistics options
2. Select an export market
If this initial analysis finds that your company is ready to export, the first question is: where will you export to? Neighbouring countries have some undeniable advantages. You know their culture, usually speak the language, distances are relatively short, there are few or no trade barriers and you can second staff with limited administrative constraints. Our advice: focus on one or two destinations you’ve selected based on the results of your documentary research and your analysis in the field. To do so, ask yourself these basic questions:
- Who are my competitors and how do I stand out from them?
- How is my product or service priced?
- What are the logistical obstacles?
- Which groups should I target?
- What are the current market trends?
- Which distribution channels could be of interest?
- What commercial, legal and import rules are applicable?
- What are the economic and political risks in the country?
You can get the answers to many questions from the international network of more than 100 economic and commercial attachés and the hub.brussels export service. They will draw your attention to the specificities of different markets and refine your export project with you: regulations, competition, access conditions, permits. Find out exactly what hub.brussels and its attachés can help you with!
Don’t hesitate to focus on niche products or services: those markets are more accessible to SMEs and local competition is less intense.
3. Create a market approach plan
If you sell your products or services internationally, you can either work directly with your customers or work via intermediaries. For many new exporters who are often short on time and resources, a foreign partner is a logical choice. They know the local culture and commercial habits very well, will limit your investment and have a network in place. The two most common types of commercial partners are:
- Sales representatives: they are self-employed and will represent your interests in a specific region on a commission basis. You will maintain complete control over sales and pricing while maintaining contact with end-customers.
- Distributors: these intermediaries purchase your products or services then resell them at different prices and under different terms and conditions in the region they are responsible for. You generally won’t know the end-customers.
Of course, you can also decide to maintain control personally. If you have sufficient financial and human resources, the most interesting option is direct sales. This avoids having to share your margins and you will keep direct contact with your customers. On the other hand, this approach generally requires opening a subsidiary or a branch office.
4. Set your prices
The purpose of exporting is to expand your market and, therefore, increase your turnover. However, you will only be successful if you actually make a profit. This often depends on just one thing: the price of your products or services. You will need to take the following into account when setting well-thought-out prices:
- the competition’s prices
- packaging and transport costs
- sales partner commissions
- administration and follow-up
- technical approvals, certificates and tests
- VAT rules and customs duties
- your margin
Do you want to find out more about how to set your international pricing? You will find all the information you need here.
5. Prepare a financial plan
Calculate the costs involved in your export project, compare them to your financial situation, and define the financial formula which best meets your company’s profile. Regardless if your project is financed out of your own capital or with a loan, there are aid measures available at the local, national and European levels.
Next, prepare a sales plan to ensure the best possible allocation of your time. It will provide you with a reference to define your priority activities, products and customers. Don’t forget to include your sales forecasts, which should include the amount you expect to earn in a given market.
6. Get started
Remember that full implementation of an export project can take several years. Don’t expect to hit the jackpot immediately, but proceed step-by-step towards your objectives. A few tips:
- Adjust to the local culture. Organise a prospecting trip, take part in an economic mission or a trade fair and immediately set up a meeting with the economic and commercial attaché in the region.
- Be sure to protect your intellectual property in other countries, including your brand and any discoveries. To find out how to proceed, click here. If you have to exchange strategic information with a prospect, be sure to send them a non-disclosure agreement.
- Spread your risks. Be sure that your company is not dependent on a single export market or customer. Secure the payments for your sales.
- Explore several prospecting methods to develop your international clientèle. Be sure to consult the events calendar of hub.brussels, the Brussels Agency for Business Support.
- Get assistance and acquire experience. Organisations like 1819.brussels and hub.brussels hold practical seminars and workshops throughout the year.
- Rome wasn’t built in a day. Don’t get discouraged by setbacks, persevere and adjust your export project as required.