5 Factors to Consider Before Venturing into Export Business
The world is evolving at a fast pace and modern technology is converting it into a global village. We’ve reached a stage where someone sitting in the United States of America can enjoy the goodness of a refreshing cuppa of Darjeeling Tea, thanks to the benefits of exporting. With imports and exports taking place, it has become easier to acquire items from around the world at just the click of a button. While it may sound very tempting to take your product international, there are a number of factors one should consider before taking the big foreign trade leap.
The need for this consideration is based on the fact that going international with your product may not always seem as exciting as it may sound. There are times when traders fail to meet the buyers’ requirements. This leads to sour experiences for both the parties. Hence, thorough research of the market, along with surety of one’s business capability, is important. These factors help to determine the right time and opportunity when a trader is ready to go global.
While Indian exports have seen substantial growth over the years, it is important for them to research the market meticulously before taking the plunge into foreign trade. In 2016, India shipped around $261 billion worth of goods worldwide. These figures grew by 47.7% since 2009 when the great recession struck. However, the present figures have subsequently gone down by -1.3% when compared with 2015-2016.
Sure, Indian exports have seen the rise and fall over the years. This makes it even more important for the Indian exporter in you to judge where your product stands in the list of the top Indian exports. This is required to understand how well your product will perform in the international market. Here’s a quick look at the products that made it to the top 10 Indian exports list for the year 2016. With the help of this chart you can easily understand the category your product belongs to and gauge its propensity to perform in foreign trade.
Now, you may have a top-of -the-line product. You are also all geared up to go global; but hold it! Have you considered the following five factors to ensure a secure approach? Read on and get equipped as you steer your export venture in a successful direction.
1.Do You Have a Ready-Army to Run Your Export Business Flawlessly?
When you run a business, you do not run it alone. You are generally accompanied by a gamut of resources that incorporate the infrastructure, machinery and skilled manpower. The quality of human resources is the most important. This is because their attitude and commitment, in turn, determines the quality of the products being produced. After all, it is these products that will be eventually exported. Proper utilization of resources determines the effectiveness of the business. This is what allows the export business to grow.
Therefore, when you take a decision as big as entering exports, it is extremely important to ensure that you have the commitment of your entire staff on board. Export business is no child’s play. When you venture into foreign trade, the work load rises and so does the need for manpower. In a scenario like this, it is crucial to have all hands working in tandem so that you can prepare your strategy for export-production accordingly.
By being prepared with your army of workers, you are clear about your ability to accomplish a task or fulfil an order within a given time-frame. Thus, should a situation arise where a staff member is unable to commit to the business requirements of export, you can plan ahead and get a replacement and keep the show going!
2.Are You Ready to Invest?
A business already requires your complete time and attention. However, an export business requires much more than that. When you’re considering exports, you need to be mentally prepared to not just invest your time and energy into the business but also ensure there is sustained monetary commitment to it.
Therefore, before you consider getting into exports, you need to map out your current expenses. By doing so, you will be clear about the investments required in the subsequent days. Besides, the amount of time you would need to dedicate to your business to fulfil the orders will also become clear. Once you can understand the required investments and arrange for them, you’ll have the financial reigns in your hand. This will give you the confidence to take on the export world.
3.What Is Your Target Audience?
You’ve got the product, you’ve got the staff, you’ve got the funds, but have you got the right target audience? Blindly jumping into foreign trade without zeroing in on your target market is a sure-shot disaster. Thus, a thorough study of the international market, followed by extraction of necessary information from valuable market insights go a long way in streamlining your approach. Having information about your target market is a crucial step in the implementation of your export strategy. Once you have the right research and reports in hand, you will be able to determine which markets to target and which ones will help you grow faster. Besides, the correct insights also help you to map and implement your export strategy correctly. So, analyse, target and grow not just fast, but grow smart!
4.How Have You Priced Your Products? Is the Pricing Too High or Too Low?
Once you have set everything else in place and your product is ready to hit the international market, the biggest dilemma kicks in. It is the pricing concern. Now, for obvious reasons, you cannot price the product at the same price as the cost price or at a price for which it is being sold in the national market. This is because you would have to take into consideration costs like transportation, packaging, overseas arrangements etc. Thus, in this case, you need to be prepared for testing different price ranges. Depending on the reactions you get from your buyers, you can negotiate or improve your pricing strategy over a period. Once you’ve had enough experience, you will be able to price your product perfectly for the international market without going through the trial and error method.
5.Are Your Documents Ready?
Being ready is a hallmark of staying alert and it inspires confidence not only in the exporter but also among the clients.
While venturing into the export world, it is important that you have your documents totally complying with the latest international guidelines.
In case you don’t have detailed knowledge on how to go about these documents, or you find it very time consuming to research on the web, you can always hire a freight forwarder on the spot and get your answers from him. Ask as many questions as possible to ensure you’re receiving all the answers and insights. Make sure you are using their
expertise to your benefit so that you can have all the paperwork duly filled in. Once all your documents are updated, you can export to your target markets without any issues or hassles.
Now that you have a fair idea of which factors to consider before foraying into the world of exports, you will be able to make more informed decisions. This approach will introduce you to the right kind of channels that can help you to make it big in the world of international trade.
The Dollar Business is one such channel that leverages your business with its unique Membership Programmes that are especially tailor-made to suit your specific business needs. They are designed to help your trade flourish like never before! So, hop on and happy exporting!
The Dollar Business (TDB) is the most exclusive platform on foreign trade in India. It offers everything that exporters, importers, foreign trade facilitators and those in the manufacturing and services sectors would have ever wished to see at one place – from News that is of total importance to Indian exporters and importers to a monthly Magazine that features EXIM product ideas worth millions of dollars every month, from India's most exclusive International Marketplace that assures any business an unbeatable edge of attention from trusted and verified buyers-seller from around the world to a Forum that gives exporters and importers an opportunity to raise their voices against issues affecting their business or the industry as a whole and make their voices heard in the power corridors. And the list doesn't end here. Access to highly important export-import data, unbeatable analyses and in-depth, actionable research from TDB Intelligence Unit to GROW members, a unique daily dose of news on foreign trade hitting your email inbox in the form of an eDaily, and an opportunity to interact with an expert panel in the Ask a Question section to clarify all your doubts with respect to foreign trade are some of the several features that TDB offers to its members and subscribers.