Taking your business global: expansion through exportingBlogs
Exporting products and services can help ensure that your business stays resilient in an uncertain, post-Brexit market. Rather than wait to find out the full implications of the decision to leave the EU, be proactive with your business and increase your resilience through exporting.
Going global with your business is a great way to increase your profits and your competitiveness. Making those first connections with an international market can be difficult though, as there are lots of stages you must complete before you can call yourself an exporter.
1. Research your market
Before you start exporting, youll need to conduct thorough research into the market, just as you would when starting any new business. Theres no point in exporting into a market that isnt interested in your product. You could attend tradeshows there to see responses to your product and there may be funded support available through Exporting For Growth to help you cover the costs of attending. The Department for International Trade also have lots of information on their website that you can access for free to help you research and engage with an international market.
2. Deciding on your route to market
Youll need to decide how you will sell your product in your chosen international market, and how you do so will largely depend on who your target market is in that country. Youll know from experience that different customers respond to different sales techniques, and your market research should help to inform your decision on how to sell. Opening a premises in the country or selling through an established retailer or wholesaler might be better suited for selling food and drink products as customers are more likely to want to view the products themselves before committing to the sale.
3. Transporting your product
Moving your product from your UK base to your international customers can be challenging. There are a number of options available to you for transportation, and which you choose will partially depend on your budget and the product that youre shipping. You can ship your products by air, rail or sea, or using land based freight forwarders. Time sensitive products, like produce, will need to be shipped faster to ensure they reach your customers well within their sell-by date.
You could also use an exporting agent or an overseas distributor to get your product into an international market. In doing so, youd benefit from their expertise and familiarity with the business climate, and they can help you establish a brand presences there.
When transporting you products, youll need to make sure you have the appropriate documentation to be able to legally export your product from the UK and import them into your new market. Youll need to apply a commodity code to your product and pay any duties associated with it. Youll have to make an export declaration and pay any import taxes too.
4. Taking payment
There are four popular ways of receiving export payments: advance payment, letter or credit, bank collection and open account, and each have their own costs and rewards that you will need to weigh up for your business.
Advance payments are best for you as the exporter, as you take payment before the product reaches your customer. Open accounts are the least secure payment method for you, as you can receive the money anywhere between 30 and 90 days after the product has been received, but it can increase your competitiveness.
Letters of credit and bank collection offer more security for both you and your customer. A letter of credit is essentially a bank to bank guarantee of payment provided you uphold the terms of your export agreement, and a bank collection means that the bank collects the payment on your behalf.
Get in touch
If youre considering exporting to help your business expand, there is lots of support available to help you get started. Hows Business, the Growth Hub for York, North Yorkshire and East Riding can assess your needs and help you find the right support, whether that be through getting advice for exporting or finance for consultant expertise and production growth. Contact the Hows Business team by emailing [email protected].