28/10/2011

David Staziker on succeeding in international markets

Crowded domestic markets can be an incentive to trade internationally. Targeting international markets can offer businesses profitable opportunities. Finance Wales has invested in a number of businesses to help them take advantage of such opportunities.
 

So, whether you’re exporting to new markets or working with new suppliers, its well worth thinking about the practical steps you need to take and any professional advice you’ll need.

Know your markets

You need to ensure you understand any potential markets you’re considering. Which local regulations will affect you? Are there any language issues and cultural barriers? Could you tie up with a local agent?
 
You need to be aware of your obligations and seek legal and financial advice. Europe may appear to be an ‘easier’ first step, but you’ll still face many of the challenges of trading internationally.

Make the most of your products

How strong is your USP? You may need to adapt your product or production processes for any potential market. This can be costly, so make sure your product is right for the market before you commit budget.
 
Protect your IP – patents can vary from market to market and it may be worth speaking to a specialist.

Get your pricing right

Make sure your pricing is realistic for the markets you’re targeting. Think about how the potential market will value your product and price accordingly. Don’t simply adopt ‘cost plus’ pricing.
 
Exchange rates can also affect your pricing, so you’ll need to ensure you have a strategy for this. Again you may wish to speak to specialists in this field.

Look out for additional costs

For many businesses, trading internationally can be profitable, but factor in additional, sometimes ‘hidden’, costs.
 
You’ll need to include shipping and distribution costs as well as duty and local taxes and even translation costs.
 
With careful research you can increase your profits, minimise your costs and avoid some of the pitfalls! The British Chamber of Commerce can offer international trade guidance to businesses.