By Kay Carrico, Consultant & Registered Broker, Export Import Bank (Exim) of the U.S., In-Compasse International in Albuquerque, NM
You have heard the statistics: 96 percent of the marketplace lies outside the U.S., a majority of small- and medium-sized companies can but don’t export and of those that do export, export to only one country.
While these statistics may be surprising to some, they are inspiring to others AND they bring to mind these questions that you should ask yourself before you consider exporting:
- What are my chances for success in selling in foreign markets?
- If the opportunities are truly big, why don’t more U.S. companies export?
- And of those companies that export, why don’t they enter additional markets?
Each of these questions has answers…sometimes many different answers. As the global middle class grows, opportunities for U.S. products and services increase. The U.S. market is a “safe” market for many companies that don’t have the financial wherewithal or other resources to devote to additional markets. U.S. companies may not want to venture abroad because of production limitations. These are all valid reasons to eliminate immediate exporting but should not deter companies from dealing with them one by one as they plan for their export future. Most companies would be ill advised to tackle more than one export market at a time but should have a list of second-stage markets at the ready. In other words, don’t bite off more export markets than you can chew, but remain ready if your first choice market does not work.
There are several important steps to take for any small- to medium-sized business that is considering exporting. While they seem obvious, they are not always considered before taking actions that are difficult to reverse. The first is to research the markets before you take the next step. Here are some questions to ask yourself:
- If my U.S. competitors are exporting, how long have they been exporting and to which markets? They would not be exporting if they were not making money.
- Are websites a good source of information about your competitors’ global strategies? Getting inquiries from your own site can also be an indication of the viability of your products in global markets. Research those parts of the world from where the most traffic is originating. Increase global traffic by adding a special page for international customers.
- Are you making the most out of your international contacts? Add the foreign visitors who attend your industry trade shows held in the U.S. to your database and follow up with a clear message that addresses any special needs or requirements they have indicated in conversations with you. Insert an “international visitors sign-in log” on your website to track visits to your site.
Additional considerations:
- Get to know your domestic and international customers and track any similarities or differences that will affect their buying decisions. There will be many, and these similarities and differences will be invaluable data as you create your Export Plan.
- Evaluate your in-house personnel. Meet with them about your export intentions and plan. Their buy-in may make the all-important difference between your success and failure as you enter foreign markets. The bottom line is that their support can earn you more money! Personnel who work for companies that export can earn up to 20 percent more than their domestic business only counterparts.
- Discuss your plans with your banker or financial advisor who can advise you of market trends and the financial requirements of exporting.
Take heart. There are many public and private sector resources available to you. Two of the best public sector resources are the international division of your state’s Economic Development Department and the U.S. Department of Commerce (US. and Foreign Commercial Service). These agencies can advise you of upcoming trade missions, provide marketing studies and partner searches and set-up meetings when you travel abroad. The costs are reasonable and the services are invaluable. There are also private consultants with vast overseas experience who can help you prepare your Export Plan, do research and provide tips on how to maximize your resources and help you avoid costly mistakes.
Remember, any traveler setting out on the path to exporting must prepare for the journey by “packing” equal amounts of information and commitment to succeed.
For more information, visit www.expertsinexports.com.