Once you have established your sales locally, your thoughts may turn to exporting elsewhere but scaling up and increasing sales abroad will invite some new challenges. Here are the three top things you should consider as you make those exciting next steps:
Cost of product in local currency.
What will you be able to sell your products for, in the new market? Local currency compared to your own could impact heavily on your profit. Do you need to factor this into your budgeting? Do you need to look at production costs and whether they need to be varied in order to make ‘the bottom line’ even feasible? The cost of living in that country could either inflate or deflate the value of your product to that market – are you comfortable that exporting to that location will work for you?
Comparing to other products
What competitors will you encounter in your new market? What do they charge and what is the quality of their product compared to yours? Can you compete? Is there enough demand for you to try to take a share? Market research in your new location is essential to ensure that there is a demand and room for your competing product in that sector. Establishing whether you can sell your product alongside those already existing and make a profit will be crucial before you start to incur the charges of exporting.
Transport – Customs/allowed products
Exporting logistics can be a minefield – even labelling your product incorrectly at Customs can result in a returned package and large un-budgeted costs. Is your product allowed to be imported into your proposed new location? What about price breaks? How much cheaper is it, if you can increase your import quantities? Have you done your homework on import taxes and duties into that country? What about storage upon arrival? Costs of transport can easily spiral if you do not do your homework. Referrals for good suppliers are priceless!