Having launched a company to make export and import easier for SMEs, Abdul Mann, CEO of Morgan Goodwin has a few tricks up his sleeve which can be beneficial when venturing beyond the British Isles
Be prepared for the worst but overcome your fears
In business, it’s common to get cold feet when doing something new. Entrepreneurs are more comfortable in their home country and familiar with the culture but that changes when exporting. Fear revolves around matters like getting paid on time to how a crisis situation can be fixed from half a world away. The first thing companies need to do is conquer their fear says Mann. Mitigate risks involved in getting credit reference checks on the company, consider getting an advance payment and get insurance in case of non-payment. These can be the red flags when setting up an export company to thrive in foreign lands. But if you have a product which is in demand, you must trade, Mann advises.
Understand the requirements and regulations
It’s of utmost importance for SME owners to ensure they’re aware of the policies in the country they’re about to enter. For instance, Iran is not allowed to do business with the US so even if an Iranian company wanted to buy American goods, it simply can’t. “The last thing you want to do is trade with a company that is sanctioned,” Mann says. “Controversially, if you’re an American company the advice you’ll get is ‘just export it’ and that’s because no country will turn away goods from the US but it isn’t the case for UK-based companies yet.” The silver lining is that your local chambers of commerce are available for advice and an integrated tool like Edge:CTP guides you step-by-step if you get stuck.
Be prepared with proper paperwork
Once you know whether you can trade with a country and understand the rules, the next step is to ensure proper documentation. This can be a huge challenge as there’s a lot of paperwork needed to trade internationally. For instance, UK-based SMEs are required to get a certificate of origin to start with, not to mention the slew of contracts, licences and declarations you’ll need too. Missing or inaccurate documents can increase risks to your business, lead to delays and additional costs or even prevent a deal from being completed. Serious stuff indeed. Having a clearly defined contract agreement in terms of payment, customs agreements and logistics is crucial. This also eliminates any possibilities of mistrust between the two trading companies.