What makes a company Export READY, and what does it mean?
Whether a company is exporting for the first time or is an established exporter; entering new markets comes with a level of risk, and whilst trading internationally has the potential to significantly increase turnover, success is never guaranteed.
What is more or less certain, however, is that any attempt to enter a new market will have a cost, making it an expensive mistake if it fails, regardless of the reason(s) behind it.
Standard preparation and planning models
On an almost daily basis, I engage with business leaders who have approached expansion into overseas markets with the same pragmatism, ambition and enthusiasm that has guided their company to domestic success.
These businesses have often proven their readiness to enter their local and domestic markets and in some cases, experienced success further afield, but have discovered unseen limitations are causing costly setbacks. They were not Export Ready
Some will have devised an “Export Strategy” as part of their Business Plan. I think it’s fair to say that whilst Business Plans are written for a variety of very good reasons, they are rarely read with the same fervour with which they were written, and usually only by a handful of employees. Furthermore, they might well define an ambition to approach a new market, but rarely would it include a review of capability to do so.
The result is that many companies look internally to define their external ambition but very few recognise the importance of global context when creating their market entry strategies.
What can happen if you don’t take global context on board?
Recently, I learned of a building systems manufacturer with a long history of export sales who prepared to replicate their UK distribution capabilities in a European country (pre-Brexit). The meticulous research and planning established that the product was compliant, capacity sufficient and keen clients awaited. What was not anticipated, however, was the intricacies of cultural and regional differences in installation regulations, a highly protective domestic market and a preference for much shorter order quantities. Amongst several other unpredicted factors, this eventually caused the project to be ended after quite some investment.
Another business was selling some exceptional, but very bulky domestic products through their own distribution across Great Britain. They were keen to expand and considered cultural alignment and ease of entry to USA and Australia as positive indications of potential success. Although these both appeared to be receptive markets for their product, the limitations began to appear when discussing shipping quantities and costs. The ultimate price of the items put them out of reach for the consumer by the time they had landed. Add to this the unforeseen recent rise in the cost of container shipping and other commodities, any potentially viable trade seemed unlikely. Further investigation revealed other hurdles, but the company is now pursuing a more focussed and strategic programme, looking at other potential markets that can be reached more effectively by road transport.
How can I create a strategy for market entry that can be both; bespoke to my business, products and capabilities and; informed by global context and our capacity for resilience?
Export READY encourages a company to improve its performance and chances of international success through the creation of a strategic visual management map. Deceptively simple, the parameters of the map will highlight potential weaknesses and identify exactly where the opportunities for growth lie. The bespoke programme will focus on making sense of the uncertain global trading environment and matching it to the competency and capacity of your company – in effect similar to a Red Teams* review of international ambition.
Throughout the staged sessions with an International Trade Matters Specialist, complex options will be uncovered, reviewed and enhanced to give your company the very best chances of success. Guided learning on areas that need strengthening will be provided, assumptions clarified, and global futures explored. Distributed leadership will be encouraged to align and empower internal teamwork and contribution. The company will be left with a viable plan for expansion and success as it mitigates and reduces the risk of failure or low returns.
*See Red teaming: a guide to the use of this decision making tool in defence. – GOV.UK (www.gov.uk)
How does it work?
Participants on the programme will follow a staged and structured programme of meetings to create and develop their bespoke maps. Usually comprising of 6 to 8 one-hour meetings (according to complexity) delegates will work at their own pace. It can be challenging, it can surprise but most of all it gives clarity of purpose and direction.
What’s more, several companies have used the processes learned to bring them back, “full circle”, to their business plan, achieve major domestic improvements, attract financial investment and much more!
“We are finding it enormously helpful, providing as it does a one-page strategic plan that clearly demonstrates the inter-relationship and dependencies between the myriad strands of activity needed to bring our product to market.”
Graham Ramsay, Rissington Applications
How do I get involved?
Get in touch with Export READY Lead, Linda Middleton-Jones below to find out how you can establish a resilience and market growth strategy for your business.