How Can You Cope Without Scope?

How Can You Cope Without Scope?

Finding your way to success in international trade

Photo by Andy Kelly, Unpslash

In a rapidly changing world, exporters need to fully understand trends in their markets and build their strategy to fit. Most of us have spent a lot of time and energy at some point, trying to build a market where everything was stacked against us when we could have had more success elsewhere.

Understanding the critical success factors for a business comes in two stages. Firstly, we need to understand ourselves. What are our strengths and weaknesses? What are our products’ unique selling points? (USP’S) and what are its weaknesses? What are we capable of as a business? How much growth can we handle, and how quickly?

When we know ourselves, we’re ready for the second stage. What’s out there? The good news for aspiring exporters is, it’s a very, very big and diverse world with lots of opportunities. The bad news? Well, it’s a very, very big world with lots of false opportunities.

Market scoping is all about identifying opportunities that are right for us. This might possibly be easier for experienced exporters than for newcomers. After all, a bit of experience gives us something to learn by. But beware, as it might also close our minds to novel, or emerging opportunities.

Our first steps in market scoping are broad brush, just like an artist. We need to look at the world and understand what’s happening. If our business has competitors in our own country, especially if they’re bigger than us, that’s a good place to start.

Let’s consider this scenario. A manufacturer of plates and bowls in clay. Ceramic tableware, to give it its proper title. George had built a nice little business selling in the UK, but they really wanted to be bigger. One of the first questions he was asking himself was “where do my competitors make their money?” And getting some answers was surprisingly easy.

First of all, George googled world ceramic table ware manufacture. He found links to some impressive looking reports, with very fancy price tags attached. He knew he would have to spend money eventually, but there must be another way to start?

The government has a website called uktradeinfo.com that contains information on British exports and imports in some detail, going back to 1996. It’s a great starting point for finding out where other exporters in your sector are finding customers, and for identifying trends. In George’s case, the very first step reveals a surprise. British exports to EU countries in his sector are growing faster than to the rest of the world. The very opposite of the well-known overall trend in fact. Here’s what he found…

uktradeinfo.com

A little more digging, and he’s found out a bit more. The biggest market for UK exporters in his products in the EU is Germany (not really surprising, as it has the biggest population). But the really unexpected fact is, British exports of ceramic tableware to Germany have DOUBLED in five years! Exports to Hungary, Poland, Portugal and Romania have grown even faster. When he looks further afield, he can see that exports to Asia have fallen badly, with markets such as Japan, South Korea and Australia showing some of the biggest falls. This is pretty much the opposite of what he expected to see. He also found that the USA was the biggest market, which didn’t surprise him at all.

But of course, this was only what other Brits were doing. He didn’t have to be guided by them, did he? He browsed the web and found a website called Market Access Database. This had lots of data about EU trade with the rest of the world. He could see that the trends were not the same for French and German exporters. Germany was exporting three times more to China than the UK was, France twice as much. And both countries had doubled their sales to China in the last five years, whereas UK exports had stayed the same.  He wasn’t surprised to find that the UK sold more to the United States. But during the time when UK exports to Korea had fallen, German exports had grown substantially.

Pretty soon, George had enough information to start formulating a plan. He would need a lot more information, but he felt he could see a way forward. Until today, whenever he had thought about exporting, it had made his head spin with all the questions. Where? Who? How? In less than thirty minutes, George was beginning to understand how he might find an answer to the first question at least, or at any rate, work out which markets were worth exploring a bit more. Best of all, he hadn’t had to spend any money.     

 

Strong and Herd are offering a new one-day course in Export Development, where participants can learn how to review their own business, research markets, spot opportunities and devise or update their export strategies. Check our website for details…

 

Article by Tim Hiscock, Strong & Herd LLP

Contact Strong & Herd
to discuss your requirements
Telephone
0161 499 7000
Fax
0161 499 7100
Strong & Herd LLP, Manchester International Office Centre
Styal Road, Manchester, M22 5WB