Exporting seems like the next step to take once you have mastered the domestic marcket. However, exporting does not only mean selling in foreign markets, but it is necessary to know hor to do it with a strategy and the necessary resources and knowledge. For this reason, it is necessary to carry out a comprehensive diagnosis that allows us to know the real situation of the comany in order to define the roadmap to be taken in the internationalisation process.
Here are the 9 areas that you should evaluate regarding your company´s situation before exporting.
1. Company structure
A good project starts with the founfations, and an internationalisation strategy is no less important. The basis and starting pint will be to look at and analyse the structure of the company: How many years of experience does the company have? Is the brand registered? Is the management committed to internationalisation? Without a solid and aligned organisational structure, it is difficult to maintain long-term business relationships abroad.
2. Product
The fact that our product is consolidated in the domestic market does not guarantee that it will be well received in foregin markets. It is very important to be clear about the problem that our product solves, as well as to consider wether it is unique in the market, or whether it is environmentally friendly. This reflection will help us to have a clear image of our product, and therefore, to define and improve our proposal.
3. Marketing
The marketing strategy must be adapted to the international market. From the website to the promotional materials, they must be designed from a global perspective. It is for this reason that it will be necessary to ask questions such as: Does the company have a defined communication strategy? Does the company have an attractive corporate identity? Are the website, catalogues and price lists translated into other languages? The easier it is for a potential client to understand the company, its product and its commercial proposal, the more likely it is the project will be successful.
4. Competition
Trying to introduce a product in a market without knowing the sector and the existing competition is like jumping into a swimming pool without first making sure if it is full or empty. Before starting the commercial strategy, it is necessary for the company to assess how much it knows about the target market, as well as about the existing competitors in the market and the strategies they are carrying out. Knowing the competition will help us to assess what the competition is doing well, or what mistakes they are making to improve our proposal, or to identify possible gaps that our product can fill.
5. Production and processes
If export is effective, it will mean an increase in demand for our product, and therefore, our production chain must be prepared for this growth. At this point, it is not enough to ask whether the company has extra production capacity, but we will analyse each process that the product goes through from its production until it is delivered to the customer, such as the speed of delivery of the order, customer service, or quality control. This will allow us to anticipate the adjustments that will be necessary if demand grows rapidly or if adjustments need to be made to manufacturing standards.
6. Economic and financial ratios
Exporting entails an economic investment, which will go towards adapting the product, certifications, logistics, participation in trade fairs, etc. If there is no financial stability, exporting may involve a very high risk; therefore, it will be convenient to evaluate the evolution of some relevant ratios in recent years, to assess whether they are sufficiently favourable to embark on the internationalisation of your products. Some of these ratios are current assets and liabilities, operating income and expenses and net equity, among others.
7. Technology
The resources used by the company to carry out its activity must also be assessed, as the more experience the company has with certain means, the more affordable it may be to introduce the product in foreign markets. Do you use digital tools? social networks? Can the product respond to possible changes such as new competitors, political changes, etc.? In an environment where transactions are closed remotely, technology is not an added value, it is a condition.
8. Barriers to entry
Each market is subject to regulations, laws, or tariffs, which are a barrier to entry for the incoming company, and which are specific to each country. Before starting the strategy of introducing a product in a market, it is necessary to reflect on how much we know about the legislation of the market in the country of destination, if we know the commercial culture, or the technical export regulations. It is necessary to determine what are our limits of knowledge in this area, and therefore, which are the issues that we should pay more attention to in detail.
9. Networking
Having contacts with foreign companies or suppliers is a key factor in international success. If you have experience in international markets, assessing aspects such as participation in trade fairs or prospecting trips will help you to consider how familiar you are with the internationalisation process and, therefore, how amateurish you are.
Conclusion
Exporting is not a matter of chance, nor is it a matter of improvisation. Exporting successfully is the result of a well-founded strategy, thorough preparation and a comprehensive diagnosis as the starting point of the roadmap in the internationalisation process.
Exportest offers you a questionnaire that includes the 9 blocks mentioned above, and once answered, it offers you back a comprehensive diagnosis with an interpretation of the situation of your company, as well as advice to follow and errors to correct, so that the company’s situation is favourable for exporting.
You can hire Exportest through this link, and if you have any questions, you can fill out the form below this article or call +34 965 651 725. Visit our website to learn about the rest of our services.
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Article written by: Álvaro Ramírez, Export Manager at Oftex