By Anne Cantelo, founder and MD of Onyx
My bank manager told me a story that has stuck with me. He was going to see a company a few years ago that was struggling. They supplied hardware to the construction industry and due to the downturn, at the time, there was no construction happening within ten miles of the company. However 20 miles away there was a big project starting and my bank manager pointed this out to the owner. The owner looked quite horrified; “That’s over the border in Wales!” The company didn’t pursue the opportunity and the business shortly afterwards went bankrupt. It is a powerful lesson for all businesses.
As the owner of a small business it is very easy to think very parochially but that severely limits your options and means that you will always be the victim of the economy you have confined yourself to, whether that’s your immediate locality, a region, the UK or even Europe. Businesses love the value and passion of working with a small PR agency, but most of the larger clients need global representation. Therefore, agencies need to establish an international presence as there is great value in reaching out beyond your borders for customers.
International trade can sound really daunting to a small business. It is challenging enough to establish your business in one country without all the added administrative burdens of selling your goods or services overseas. What have we learned?
1. Do your research. You need to understand the market you’re entering. What’s the potential? Who are the competitors? What is the best route to reaching customers? Will you need a local agent or can you sell online?
2. Work out the business case. What can you gain, what will it cost?
3. Use your networks and tools such as LinkedIn to engage with the right people.
4. Choose a market where there is a strategic or opportunistic reason for being there. In our case our first partner is in Dallas because we have clients who need US PR.
5. Use the services that exist, such as UKTI. They have huge local knowledge and prestigious representation in the markets (the embassies and consuls). They run trade missions that can give you a very good idea of the challenges and opportunities in different markets (and if you’re a small business you’ll feel a lot less lonely). They can also help ensure you meet any legal requirements (or at least make sure you’re aware of them).
6. Use local people to support you. Cultural differences will impact on whether you're successful or not and that can’t all be picked up through research. We’ve all laughed at foreign labels that have been poorly translated but the issues go well beyond that.
7. Get the pricing right. The price that works in the UK market may be uncompetitive, or too cheap for your positioning, in a different market.
8. Don’t underestimate the potential challenges of getting paid. Talk to your bank about it, do your credit checks and consider one of the many banking services that take away the risk. If you can’t get the assurance you need, walk away from the deal.
Many businesses start exporting because they receive an order from an overseas market. If that is the case you still need to do your research and follow the rest of this advice to ensure it is a success.