TO EXPORT

Science, experience or common sense? Practical advice for those who want to expand abroad.

Export has become one of those magical words for instant success. Is it?

Unfortunately, the reason for exporting, or the selection of markets, is not always well thought-out but more often "accidental".
 

HERE ARE SOME OF THESE "ACCIDENTAL" REASONS:

1. Free trip abroad.

 
2. Exporting is popular. The government even selected October as "Export Month" of the year.

 
3. Too much in stock.

 
4. Business is too slow at home.

 
5. The newspaper said that Pacific West is an interesting market. 

 
6. A neighbour told you that Russia is an interesting market.

You and I know that these reasons aren't the right ones but unfortunately they are very common. This is the way many companies have started their export activities. Let's look at these reasons, one by one.

1. Free trip abroad.

There are much cheaper ways to buy an airline ticket. You and your company will pay for years for a poorly made decicion.

2. Exporting is popular.

Just because the government has said that it's good to export is not enough of a reason for you to to do so. That they have selected October as the "Export Month" does not make it the right choice for you. Every month of the year is an export month. You need a much better reason for starting to export.

3. Too much in stock. 

The day you find out that you have too much in stock is not the time to start exporting. If you had planned earlier and had already established yourself on the export market, you would have spread the risks around and would not have been caught with all that inventory.

4. Business is too slow at home. 

If you had several export markets established, you would not have been hurt. You certainly know that after an up-turn comes a down-turn. The good thing is that these changes do not happen simultaneously all over the world. By spreading your activities on different markets, you will level out the periods of change.

5. The newspaper said that Pacific West is an interesting market. 

It's very possible that the Pacific Basin is an interesting market. It, however, very much depends on what products you have and how those fit into that market place. Even if you're told it's a good market, it might still not be suitable for your product.

6. A neighbour told you that Russia is an interesting market. 

Russia is an interesting market, especially considering what is happening in the eastern countries right now. But if you are a new exporter it should most likely not be your first market to enter. The way to do business there is completely different from what you are used to at home. Furthermore, it normally takes a long time to enter this market and you are not guaranteed repeat orders. 
 

HERE ARE SOME POINTS TO CONSIDER:

With a home market that is well developed and rather small, many companies, small and large, have found that exporting is a natural way to find new customers. Exporting gives the company a possibility to expand and to increase their profitability.

For successful companies this has resulted in a steady, high level of production and the possibility to keep skilled labor. 

It should be mentioned that export will demand more knowledge and resources than is the case for the home market. 

It will put a higher demand on your staff, demands for better product information and better financial control. 

However, with the right planning and right strategy almost all companies, small and large, can be successful. 

To be an exporter is important not only for large companies, but for small and medium sized companies as well. 

To be successful on a foreign market will demand the skill to make decisions and the ability to stay in for the long haul. 
 

YOUR REAL REASON FOR EXPORTING SHOULD BE:

To increase your market which will result in lower production costs, higher production volumes and the ability to write off the research and development costs on higher volumes.

To meet your competition on foreign markets, making it possible not only to know what they are up to, but also to make it possible to be more prepared when they enter your home market.

Achieve a longer life cycle on your products. If your product is too advanced for the developing markets today, it will most likely fit into their market in five to ten years, when their market has "caught up". In fact, you could even develop your product for markets that are more advanced than your home market. Start your introduction there and you will make it possible to have a product for the home market two to five years down the line.

Many successful exporting companies have more than 90% of their sales in the export market.

Many successful exporting companies have more than 90% of their sales in the export market.
 

WHO CAN EXPORT?

If you have been successful on the home market and have enough resources, then you have good possibilities.

Of course, it is not imperative to be successful on your home market. There are today companies exporting 100% of their products.
 

If you have been able to succeed on your home market, then you have most likely also the prerequisites to compete on a tough foreign market.

Good luck with your export endeavors!

Look for our next newsletter in the series.

Remember: "Exporting is a mental attitude".

Leif Holmvall

Copyright Export Pro Inc,  Toronto

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TOOLS FOR  EXPORTING:

Interested in  starting, or increasing, your export activities? Put an "export pilot" to help  you navigate to new altitudes.

Contact us and we'll tell you more about it or visit our website and check out "Export Office to  Rent" http://www.exportpro.com

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UPCOMING EVENTS:

"Some Recipes for  Successful Exporting". A practical seminar covering our five keys to success. Plenty of case histories from across the world.

When: 7 pm, August 27, 1998. (Thursday)
Where: Young Entrepreneurs Association of Ontario
5001 Yonge St, 2nd fl, Royal Bank Tower
Toronto, Ontario,  Canada

Cost: $20 for  non-members, 
$5 for members (membership till end of year -  $25)

To register, contact YEA. Phone: 416-588-0908, fax: 416-532-0934 or e-mail: yea@idirect.com