Seven questions to drive your export planning success
As anyone will tell you, the devil is in the detail – and never more so when you are planning to start exporting your products to international markets. A staggering 50% of businesses entering export markets will end up pulling out around 12 months later, all because they did not plan enough and did not really understand the market they were targeting. Taking your product to a new market isn’t just a matter of boxing it up and sending it on its way – at least, it’s not if you want to be profitable. So we’ve got seven questions to start you thinking about your plan to go global.
What’s your business objective?
‘Growth’, by itself, isn’t a specific enough objective. Are you looking to overseas markets to spread you risks, improve your profits, or increase your production volumes? Remember that other old saying, “you can’t get there if you don’t know where you’re going!”
Which markets are the best match for your products?
Just because it seems like every else is talking about China right now, doesn’t make it the right market for everyone. Which markets have the highest potential to deliver profit, loyalty and conversion rates for you? And while you are thinking about that, do you know which countries Australia currently has Free Trade Agreements with, and which markets are in negotiation? Are any of these countries on your radar as high potential export targets? Should they be?
Who’s buying – and who’s selling?
Gaining traction with consumers in a market already crowded with similar products can be tough going. Consumer and cultural differences, which influence everything from the number of products in the box to the texture of the finished product, can significantly affect your chances of success. It’s essential to have a detailed understanding of your targeted consumer segments and your competitors.
What will you need to change?
Do you have to rework a recipe to meet regulatory guidelines on ingredients that are (or aren’t) allowed in your target market? Will developing new flavours to meet a distinctive consumer preference be the secret to success? And back at home, is your website up to date with the content to back up your marketing campaign when you pitch to a new retailer or distributor? If you need to change your packaging, that decision could flow on to affect pack weights and freight costs and, ultimately, your bottom line. Then there’s the spectre of a complex international product recall – how will you manage that if you have to?
What are the real costs of exporting?
You may have a unit cost in mind that includes an attractive profit, but will it add up when you factor in all the costs of exporting? Export set up costs, delivery costs, certifications, and modifications to your capability and your products may be required to give you the best chance of success, so add them in now to make sure your sums all work in your favour to deliver a product to the target market that carries the right price tag for customers and consumers and still includes a realistic profit for you.
Who will be your new partners?
The right business partners are critical to successful penetration into a new market. Do you want to work with a sales agent, or would you prefer to appoint a distributor? What will their margins be and who will be responsible at which stage if things don’t go according to plan? Taking shortcuts now on your due diligence simply means you really don’t know what level of risk you are taking. From your preferred freight forwarder to your new customer, you need to know who you are dealing with to find the right match and ensure you have the best chance of being paid when you expect to be paid.
Are your export goals achievable?
Dreaming big is important, but making a realistic assessment of how to get your end goal is vital. A realistic assessment of your production, packaging and human resources is essential. It’s all about working out exactly how to get there from here, and asking yourself whether you can do that with your current capability and resources. If you can’t, do you need to make some changes, invest in upgraded capability, or perhaps review your original export objectives? Early planning means you can deliver what you promise to your new customers and keep your current customers happy too.
Connect with us to fast track your export growth
The South Australia Food and Beverage Export Hub offers a one-stop-export shop to assist you to fast track your export growth. Developed by Food South Australia, the Export Hub program is structured into three modules, each tailored to the business needs for your stage in export growth. Each module includes services and support specifically designed to strengthen your export skills.
- Click here for more information on the South Australia Food and Beverage Export Hub
- Click here to submit your expression of interest in participating in the Export Hub program with Food South Australia
- Evaluate your current level of preparedness for export using the Austrade International Readiness Indicator