Is your business ready for international trade? Let’s stop right there because it shouldn’t be a question. You should know for certain that your business is ready. Otherwise, there’s no point in even considering the possibility. It’s just going to lead to disaster. You need to think about the market. Make sure there’s a demand for your product across the ocean. Compare your product to what’s already being sold over there. If it’s similar to existing, popular products, there’s demand. However, that also means that you’ll be facing a lot of competition. Therefore, you’re going to need a USP. Something that makes your product or your business different from the rest.
Think about who you’re going to be selling too as well. If you’re a B2B company, consider reaching out to businesses. Have meetings with companies that you think would be interested in buying your product. If you’re selling to the GP, you need to consider forming partnerships with suppliers.
Finally, does your international plans fit into the budget? You need to consider logistics, exchanges rates, set up and other costs that are part of the international model. If you can cover them all, preferably without borrowing, we’re ready for business. Now, we need to think about how to get started.
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International Trade Decisions: Choose Your Market
Choosing your international market isn’t just about demand. You need to consider other issues such as economic factors as well. For instance, previously, it might have been a fantastic idea to trade with Britain. After Brexit, things are now up in the air. It’s unclear how or if they will be part of the single European market. This means that trading with the country will be more difficult. Unless you are setting up a new branch, you will be looking to export your product to different countries. Economic factors and trade possibilities are going to be important.
Consider the location as well. Do you want to sell to a country that is thousands of miles away? This could drive up your transportation costs to the point where they become difficult to manage. Due to this, you will need to use the services of a logistics company rather than completing the job in-house.
International Trade Decisions: Outsourcing Logistics
It doesn’t matter whether you are selling across a country border or an ocean, outsourcing logistics is the best solution. By doing this, you’ll be able to transport your products without the costs involved. Instead, you can pay the company a fixed cost that will be more than affordable. When choosing a logistics company, you should consider their resources. You need to think about how fast you want your products to be delivered. A company that offers air travel is going to be faster compared to one that uses shipments.
International Trade Decisions: Understanding Regulations
There were are legal issues associated with exporting your product internationally. You’ll be operating on a brand new board game with new rules and new challenges. One example of this is packaging and labeling. It’s amazing that something so simple could kill off plans for international expansion. But it could. If you don’t label and package your products according to international regulations, you won’t be able to sell. At best, they’ll be sent back. At worse, you’ll lose them all together. This is particularly important if you’re transporting hazardous materials. You need to gain permission to export them. Then, you need to think about getting correct packaging supplied by a company such as C.L. Smith. This is just one example of the role regulation can play in an international business model.
It’s strongly advised that you recruit a legal advisor, specializing in international trade. They will keep your business on the right side of the line.
International Trade Decisions: Know The Culture
Once you’ve established the basic setup of your business model, you need to again, turn your attention to who you’re selling to. The culture of the country to which you’re exporting may not be the same as your home location. You will be making business partnerships and deals if your company is going to be a success in this new market. You will have to make sure that you can secure the deal. That’s not always easy. You should research the culture where you’re selling carefully. Again, it’s important to consider things such as dress laws. Dressing inappropriately will weaken your chances of securing a deal. They will think that you don’t respect their country or their position. Make sure you complete research on the country or location. This will provide points of conversation before you approach a sale.
Are there language barriers? You may want to hire and arrange at least two interpreters. One for them and one for you. Better still, learn some of their languages before your first business meeting. If there is a language barrier, this will at least allow you to engage directly with some parts of the conversation.
International Trade Decisions: Find A Distributor
At this point, you have arranged for your product to be transported to a new country. You have researched and abide by the regulations of trade. You know the culture, and you’re ready to trade. Now, you need to find a distributor. Someone who is willing and able to sell your product.
When you look for a distributor, consider a supplier who is willing to purchase your entire stock inventory. That way, a deal can be arranged, they will sell your product, and you will gain a portion of the profits. You need to look at their history. Do they have knowledge and experience of the market where your product is going to be popular? If they don’t, you may want to look for another distributor. Think about special knowledge as well. For instance, if you’re selling tech, you need a distributor that is equipped to market that type of product.
Finally, it is important that the service provided by the distributor is prompt and efficient. Anything less will lower the efficiency level of your business and damage your chances of success.
I hope you use this advice to make the most you can on the international market.