If your business is thriving in the UK and you are thinking of expanding your reach, trading overseas could start to look very appealing to you as a business owner. Bigger reach, more customers, but at what cost? Always do your research before you decide to expand overseas, and don’t try to go ‘too big too quickly’. If you try to become a global company in one swift move, you could risk too much hard earned cash from your local business and it could pull your whole operation down if you fail. We have put together four basic do’s and don’ts of trading overseas to get you started on the right track!
Do conduct research
Stating the obvious, but a very important factor. You can never do enough research. First of all, check out other UK companies in your industry who are successful at trading overseas, you can pull their company credit report and see what kind of figures they are bringing in from their UK operations to have an idea of how much cash you would need to fully support the expansion in your own business. By checking out these companies you are also aware of what competition you have in this new market. Don’t forget to check laws, legislation and trading standards in the countries you are hoping to trade in, local knowledge will be gold dust when it comes to entering a new market. You will also need to check the demand for your products in new markets and if the market share is there.
Don’t forget localisation
To appeal to a different market in a different country, you will have to localise your offering. What marketing works for you in the UK to attract new customers may not work for you in the Asian market for example, so you will need to get inside knowledge on marketing practices and think of how you will adapt your approach to appeal to different people, businesses and cultures. You must also check that your product is compliant in other countries, and you may even need to use local manufacturing processes overseas to meet with the standards and compliance of that country so keep this in mind when you are creating a budget.
Do invest in Marketing Data
Investing in marketing data can be the key to your success in a foreign market. You have leads to follow and a foot in the door instead of going in completely blind. If you’re starting to trade in Europe, Creditsafe can offer European marketing data in Belgium, Finland, France, Holland, Italy, Luxembourg, Norway and Sweden. By investing in this data, you are able to see how many opportunities there are in each country for you to sell your product, and you will also have companies ready to call before you start your shipping process.
Don’t forget to credit check
As you would on home turf, you also need to credit check when expanding overseas. There is a common misconception with businesses where it’s believed they only need to credit check their customers to make sure they pay them on time. If you have promised a company overseas that you will ship your product to them, you need to credit check your suppliers and exporters. If they go out of business, you will be left with no product to sell or ship so it’s important to be monitoring them as well. This doesn’t mean you shouldn’t also credit check potential customers overseas as this is also a priority, you just need to be cautious with everyone who you deal with and ensure your business can continue to produce and sell products.
So there are our 4 top tips, do you have an experience of trading overseas? Let us know in the comments below!