When a company sells in international markets, it earns significant profits: greater competitiveness, better margins and diversification of market risk. For this reason, it is essential that companies, both large companies and SMEs, implement strategies to make their way in other latitudes. Randall Castillo Ortega, an entrepreneur and expert in import and export operations, provides insight into how an export business can conquer new international markets.
An export business is two things – an exchange of products and a search for new opportunities for the development of the sectors. An internationalization strategy must incorporate the considerations that justify entering a given market, as well as the actions to realize that purpose and take advantage of the advantages or benefits of this incursion. To get started, entrepreneurs must identify the target market and validate if the offering has potential. Explains Castillo, “Study the destination country well, know the entry requirements, the marketing and distribution channels, even, visit it and identify similar products, packaging, labeling and consumer trends.”
Show consumers and other market players the value of your offer. Plan a schedule of visits to international fairs with your portfolio of products or services. Exports must not respond to transitory circumstances, but must obey a strategic plan for business growth and expansion.
Know the Rules of the Destination. “It is very important to take into account the tariff and non-tariff conditions that are imposed in the destination markets,” asserts Castillo. “Checking if there are Free Trade Agreements (FTAs) or any trade agreements is essential to establish the costs of the product, good or service you want to trade.” Likewise, in the case of manufactures it is essential “to have a certificate of origin and know these rules so that entrepreneurs can access their benefits. So, here the issue turns to making a good market intelligence, analyzing both political and economic, cultural and social variables.
Define a leader who speaks the same language as the target market. Determines an area or a person in charge of leading the internationalization strategy, who has a perfect command of the language that predominates in the destination country. Many times, our entrepreneurs want to venture into the international market and the person who handles foreign trade does not master the language. The information on their website and their marketing materials are only in Spanish. This is why it is important to master the language of the target market, one of the key elements to engage in negotiation with potential international customers.
These are the five keys elements that are recommended to entrepreneurs to venture into foreign markets and position the brand and the company. The first is the identification of products with export potential. Next, evaluate the export potential. Check which are the products of your company with the greatest potential to export and expand your knowledge of foreign trade. Identifying the requirements for your product is also a necessary step. Check the tariff position of your product, search for potential markets and evaluate the conditions of access. Review market and buyer requirements to analyze opportunities and trends in the target market or country. Lastly, evaluate logistics and international physical distribution. “This examines conditions such as terms of negotiation, logistical aspects for the export of perishable products, merchandise insurance, transportation alliances, shipping cost simulator, checklist, packaging and packaging,” explains Castillo.
In addition to all of these points, it is also imperative that entrepreneurs take a look for good business management. They should attend seminars on markets of interest and product suitability, as well as participate in trade shows and business roundtables and sign up for publications that guide you on business opportunities in target markets.