Global Business Perspectives

Many people are thinking of how they can export these days.  I attended a seminar last Monday on how to diversify your business by taking it global  From what I can see there are four stages of exporting.

1.  Gain Preliminary Information on the Foreign Markets

• Select the most attractive countries to your organization.  A great resource for this is www.ciafactbook.com.  Consider many factors.
  • Physical/Geography
  • Demographics
  • Politics
  • Economics
  • Social/Cultural
• Assign weights to each factor based on the importance of each from your company’s perspective. 
• Utilize a screening process and use the same process for each country/market

2.  Analysis of industry Market Potential

• Market Access – check tariff levels, quotas, trade barriers
• Legal Matters – understand the investment, taxation, employment and code of laws
• Product potential – does the country encourage consumer imports, will local production necessary, how will you promote the product, and how many competitors are there.

3.  Partner Selection

• What characteristics do you want
• Formalize the partnership with a legal agreement (with criteria for terminating)
• Manage expectations around communication, performance and short-term or long-term plans

4.  Sales Analysis

• Forecast sales volume
• Entry costs including financing needs if export taxes, tariffs or duties will be charged
• Cost of distribution in the country including any local packaging or translation
• Determine proper pricing based on competitive environment
• Analyze your product life cycle

Exporting is a big change in your business.  By ensuring that you include a thorough investigation of each of these steps you will have done your due diligence and can enter a market knowing what you have a solid exporting process.