Must Select a Profitable Overseas Market
Once you have a good idea of what you want to export, you must decide which overseas market you are going to enter. Here I look at a variety of factors that play into the decision-making process.
In “Exporting: Will Your Product Succeed in Your Market of Choice” Asked a series of questions that helped you determine market conditions before selecting an overseas market. Among them are:
1. Who will buy your product, and why?
2. What is the size of the market?
3. Who is your competition?
4. How new is the product to the market you have selected?
5. Are there growth opportunities in the market?
Once you answer these questions, the next step depends on what type of product you are selling and what you are trying to accomplish, because each country might offer a unique advantage versus another. For example, are you trying to sell organic butter to customers in Ireland or snow blowers in Zimbabwe? Ireland might prove to be a great country to enter for sales of trendy American baseball caps, but for a country rich in agricultural resources, butter might be the last thing it needs. Case in point: Kerrygold butter (http://kerrygoldusa.com/products/butter/). And Zimbabwe, only on the rarest of occasions has experienced snow. The product really dictates where there might be a ripe opportunity to export to a particular country.
The next factor is how will culture influences affect how your product or service will be perceived. A simple solution for this issue would be to export to cultures that are similar to your own locale. Take me, for example. I am based in the United States. Markets that are culturally close to my own are: the UK, Australia, Canada and New Zealand. When you enter a market close to your own culturally, you can communicate more fluidly and easily localize your product offering to fit the needs of the marketplace.
Another consideration is the size of the potential market in terms of population and the amount of money people have to spend (GDP per capita purchasing power). Can consumers afford your product? Is the country growing at a fast or slow clip year after year? Also look at a country’s infrastructure. Does the country have the ability to transport products from point A to B?
As you get closer to selecting a market that works in all respects, ask yourself this: Are you excited about the thought of traveling to the market repeatedly? If not, go back to the drawing board and find another market, because if you sell a product like hotcakes overseas yet dread visiting there, it’s just not worth making your life miserable. Pick a market you want to go many times over because you want to be comfortable in the environment to ensure you do good work. Plus, we all know that relationships rule the world and you’ll be cultivating lots of them through the course of managing your business.
When all else fails, meaning you are clueless in where to go, you can always shorten the learning curve by working with a distributor that has deep roots in the overseas market and will help speed the market-entry process. The distributor you select should also have a pulse on any political activity—good or bad—that’s taking place or is anticipated in the foreseeable future.
What am I really saying here? You must do your homework and if you do, the sky is the limit on expanding internationally if you pick the right market and the commitment is there.
