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Fancy a holiday? Why not take your product/service with you?

Posted by: Mark Jones 18 Oct 16 - 5:27PM  | Commercial

Adrian Mansfield International ContractsThe collapse in the value of the pound, down against the dollar by almost 20% since the EU referendum in the summer, means that many companies are looking to capitalise by increasing export of their goods and services.  Adrian Mansfield, Associate Director at Jonathan Lee Contracts International, explains the lessons he has learnt during his 18 year pedigree in international business/trade and provides helpful tips to approach new export during this opportunistic period.

Over my years in business, I have set up companies in the UK, USA, India, Middle East and Africa. Some of these were established as a direct response to client needs and so had support from the start, others were more speculative, albeit based on my experience of the market and my product. 

What I learned through the success of these ventures is that the key to effective export is keeping entry costs low.  In all cases, the entry to the market was quick and cheap, thereafter I would assess and develop each export on the basis of results.  I did always ensure that I had an exit plan that allowed me to walk away if needed. 

Many UK companies are now being sold on the idea of increasing exports with the weak pound and the uncertainty of Brexit looming.   A recent report by the UK government stated that 1 in 5 companies in the UK export goods and services.  If the UK had kept pace with global export growth over the last 5 years, in 2014 alone, we would have increased revenue by $78 billion. Who knows what that number could be today?

The UK undoubtedly has a huge range of highly successful companies ranging from start-ups, SMEs to major corporates, all of whom have products and services that are both wanted and needed overseas.  The government’s own website at www.exportingisgreat.gov.uk can show you what is out there.  So what is stopping us from forging ahead?

My experience suggests that the biggest obstacle on the export journey is the fear of risk. Of course, there are risks associated with setting up an export business but then again, there are risks in any business even if you’re selling in your own backyard.  I believe that you should start with the benefits; access to new customers, potential growth and better visibility of the global marketplace.  Weigh these up against the risks and make a more informed decision.

So my tips are simple:

1)    Pick a place you can envisage a market for your product (use your own market insight – who uses your product at home?)  Book a flight, go there and ask people what they think.  At worst you’re expanding your horizons and at best, it could open up huge opportunity.

2)    Use the resources that are readily available and already established:

  1. The UK has a huge network of Foreign & Commonwealth Offices all of which are set up to help UK businesses export.  Find the one in your target area and arrange a meeting.  I benefited from lots of useful local information and they could even help you to set up sales meetings.
  2. Many developing countries are keen on bringing in inward investment. Check if the area you are targeting has a dedicated inward investment team and arrange to meet.  They too will be keen to engage with you and help in any way possible.
  3. Accountancy partners – does your accountant have a global partner?  Many do, so ask them for an introduction and a free consultation to get a local view on risk and also the ways indigent companies overcome these.

3)    Find a relevant trade show and attend as a visitor.  Many of these are free of charge to attend.  By treading the boards, you will get a good view on the market and who the key operators are in the market.  Don’t be afraid to ask questions!

4)    Speak to your local UKTI representative.  Every region has one and they can often access funds to pay for foreign visits.  When I set up a business in Qatar the first trip was funded by UKTI with £2,000 that paid for a flight, hotel and some local expenses which meant that even if I had decided it wasn’t for me, I wouldn’t have been out of pocket.

Gaining this personal experience and understanding of the local economy you can better evaluate the potential market and look at the risks with a more rounded perspective.  Also, don’t forget there are many ways to soften your landing in a new territory.

-        There are many companies offering virtual offices for a minimal monthly fee including phone and answering service so if you need a local number, this could be a cost effective solution

-        There are UK Government supported “incubators” in many key markets (US, India, Middle East) that offer low cost entry without long term commitment

-        Many UK trade bodies have international connections that can offer space for members to work from when on sales visits

-        The UK Government can also offer export funding that de-risks the cost of cash from invoices and can often step in where banks may not be keen to venture

-        Accountants, solicitors and financial institutions have access to a plethora of data from other companies working overseas and can often be persuaded to pass this on free of charge if they see the potential for long term benefit

With no sign yet of the currency bouncing back and inflation set to rise, the export market presents an excellent opportunity to grow your business.  With support available from many sources, why not explore taking your business with you the next time you travel? 

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