Extending business into new markets is often one of the most effective ways of increasing sales, even in tough trading conditions. Few companies are truly global to the extent that they are selling in every country worldwide.
We looked at selecting new markets in a previous article. I’ve often found that potential new markets suggest themselves, for example if I get a flurry of enquiries from a particular country I usually take note and at least try to understand what is behind it. Sometimes it can be down to something very specific such as a mention in a journal, or a change in law or practice that has made an item a requirement for workers. Sometimes there is no apparent cause.
For most exporters, I suggest that there is nearly always some ‘low-hanging fruit’ in an untapped market that can be accessed quite rapidly. But it’s very important to be aware of what you might be taking on. Developing a new market can be time-consuming and is likely to detract from other things. Don’t start to work on a new market unless you are confident you have the time and resource to see it through.
Having selected a target market, and taken the decision to visit, it is always advisable to research and plan in advance. Try to get as much information about target customers and competitors as possible. Also look at general information such as the physical size of the country, population, relative standard of living and any possible barriers to entry. For a business with a track record of exporting, it often becomes fairly routine to know what the salient points are in a new market and plan accordingly. But beware! Markets are not all alike and even in relatively homogenous regions such as Western Europe, taste and practice can vary quite widely between neighbouring countries, and even within a country.
If a visit is prompted by specific opportunities with known potential customers, try to find out as much as possible about the targets. Company websites are the easiest place to start, and understanding them has become much easier with the increasing sophistication of online translation facilities such as Google Translate. Some internet browsers such as Google Chrome offer a facility to instantly translate the text on a web page. I’ve warned against using such translation facilities for writing to potential or existing customers, but for getting a general idea of a target’s business they can be really useful.
Always remember of course, that a company website is only telling you what the business wants you to hear. And naturally, most sites are aimed firstly at potential customers rather than suppliers. It’s natural for any business to try and ‘big themselves up’ on their website, so don’t take anything at face value. That stunning building that appears to be their head quarters? They may only rent a couple of rooms around the back.
Depending on your business sector, it is often useful to find out about the nature of the sector and its participants. I sell to health professionals, and the particular professions that use our products often have their own professional body, who are likely to have their own website and possibly an online newsletter or even an open database of members. This kind of information can be really useful in planning a trip, and with a new market, I often try to see someone from the professional body or trade sector on my first day in the country, as they can tell me a lot about the nature of the market, current requirements and key competitors.
It’s important to think carefully about when to go, avoiding above all any public holidays or periods when there is industry shut down. Particularly away from the gentler climates of Western Europe, many parts of the world have periods of the year where work stops due to extreme temperatures or seasonal extremes such as storms. Equally, there may be national or regional events that are worth attending such as trade shows or conferences. Check carefully, and look at the practicalities of travelling, including the availability of flights and hotels. Canny exporters can make their travel budgets go further by carefully timing their trips to avoid the busiest periods.
It’s also important to know where to go within a market as well, and how to get there. When targeting large countries such as India, it’s often advisable to target one or two key regions at first, rather than try to conquer the whole country in one visit. Don’t be too ambitious on a first visit, and especially in developing countries, take advice on health and safety and the limitations of the country. Visitors to the world’s biggest ‘supercities’ such as Beijing or Sao Paulo will often be well advised to limit themselves to no more than two appointments each day, as travel between appointments can be time-consuming and exhausting. Some travellers are tempted to cram as much as they can into a visit, but I find this can be counter-productive. Better to select visits carefully and allow plenty of time for each meeting, as well as sufficient time to write down my thoughts afterwards and arrive promptly at the next meeting without cutting the first one short.
After the trip, make time to follow up promptly. Contact everyone you met and confirm what you are going to do next. The first visit is only the start. Make it count!
Written on 3rd June 2012 by Tim Hiscock, S&H LLP Associate
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