Here are five key pieces of advice for building an effective export plan.
1. Plan before you leap
It’s natural to want to act quickly when a new business opportunity comes up, but planning before you start exporting will help protect you from unknown risks down the road.
The exercise often has double benefits for a business. It gets you thinking about productivity and how to scale up, and often drives innovation—three key challenges entrepreneurs have to confront whether they export or not.
That’s because businesses that want to serve more than one market generally have to increase productivity. By going after a bigger market, you need to think about how you’re going to scale. And exposure to new competitors forces you to become more innovative. Productivity, scaling up and innovation should all be addressed in your plan.
2. Think through the potential challenges
To give your business the best chance of success, anticipate the challenges you might face and use your plan to describe how you’ll deal with them. There are a lot of factors to consider, including:
- Market size
- Customer behaviour
- Distribution channels
- Regulatory requirements
- Political landscape
- Exchange rates
- Intellectual property protections
Identifying and quantifying potential risks will help you decide if your product or service is a good fit for the market you’re considering.
3. Decide how you will get to market
Think through the nuts and bolts of logistics, delivery and post-sales follow up. You’ll probably want to use a distributor who knows the foreign market well.
It’s important to thoroughly check out any prospective partner. Reputational problems with a distribution partner can be a “show stopper”. Connections can make or break you.
4. Stay agile
Don’t think of your plan as “carved in stone”. You want it to be thought out well enough to serve you for two or three years, but treat it as a dynamic, evolving thing that can adapt to market changes like exchange rate fluctuations. Review it on a regular basis to validate assumptions and fine-tune as time goes by.
5. Give it the effort it deserves
Export planning requires an investment of time, effort and brainpower if you want to do it right—and doing it right can yield big benefits, so it’s worth it. You will have to acquire market research, and may need to travel to the target market, for example. You may also want to hire a consultant to help you make sure you’ve got all the bases covered.
While every export plan is different, the exercise typically takes four months for most businesses.
Patience is important when creating your plan. You may only begin to see returns after two or three years when going into a new market. When you do, your upfront investment in good planning can pay off many times over.