The purpose of an export plan is to assemble facts, constraints and goals, as well as setting out a schedule. Here are the seven key export planning issues to consider.
1. Export potential
Is your business ready to export?
Consider your company's reasons for exporting – for example, to:
- achieve long-term expansion
- enhance competitiveness
- exploit unique technology and expertise
- improve return on investment.
Assess whether your product is suitable for export, by considering:
- product standards and regulations
- costs of adapting and modifying your product for international sales
- export licence requirement.
2. Export market research
Identifying and evaluating the target export market will enable you to:
- understand the industry structure
- forecast product demand
- identify competition
- determine product modifications needed.
Research your industry sector in the export market, finding out the opportunities and growth areas, as well identifying any barriers to exporting. At this stage, it is also a good idea to create a basic customer profile for your product.
3. Export strategy
The next step is to develop an export strategy, defining how you will enter the foreign market and find trade leads. Decide whether you will be exporting indirectly through intermediaries – which will require finding overseas representation – or doing it yourself. The latter option means you'll have to consider how to promote the products abroad and what type of after-sales support you will be able to provide.
4. Export pricing and delivery
It is important to consider product pricing and quotes, methods of payment, shipping terms and costs, in order to calculate accurately your exporting expenses and budget for them accordingly.
5. Exporting rules and regulations
Next, ensure that you understand and comply with the rules and regulations of international trade. Being aware of such rules will help you to convert them from export barriers into benefits.
6. Export financing
Consider how you will finance your export plans, including calculations on your expenses such as salaries, travel, advertising, distribution, production, etc. State whether the daily operations will be funded from an outside source or internally. Include a projected sales forecast in your export plan – this will help you to measure success.
7. Export implementation issues
The last step is to identify milestones or time frames for key tasks. This will help you to evaluate your progress and communicate expectations to your staff. Your export plan should include dates for major tasks and identify parties responsible for the tasks.
Ensure that employees and partners are able conduct their specific duties, employ people with relevant export qualifications and/or provide export training to existing staff. The key personnel involved in the exporting process should also have involvement in building and agreeing the export plan, as they will help to execute it.
At the outset your export plan will probably be quite simple and brief, since some areas may require further research. However, the export plan should become more detailed and complete as you and your team become more experienced.
Complete the export planning process
- Draw up an export plan that takes account of the steps listed above.
- Consider what personnel and company resources you will need to dedicate to your exporting activities.
- Set up an evaluation system and modify the export plan if appropriate.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.