You have an established and growing UK market so why not look abroad to discover whether your product or service can successfully compete overseas? This guide gives the lowdown on beginning to export. By the end of the guide you should know:
By selling your product or service abroad you could grow your revenue and profits and become a bigger business. But before you begin you must work out your export potential. This means assessing whether your product or service is right for each target market. You also need to assess whether you have the required financial resources to start exporting as it is a costly process. Do you understand export payment mechanisms and export finance? You can talk to your accountant or bank manager about this.
You should start with market research to help you identify and evaluate the target export markets where your business can succeed. Predicted demand should be looked at as well as the level of competition in the target marketplace. How can you fit in? Will you have to modify your product to make it sell and meet local regulations and standards and can you meet these costs? Is your product suitable for export? Take note that grant support is available for investigating new market opportunities but you should set a realistic budget for your research.
You need to work out how you are going to sell. You could do it over the Internet or exhibit at local trade shows. You could also look for a partner who knows the local market or use a sales agent who will sell on your behalf. You need to look at your Intellectual Property and get it secured for each country you intend exporting to. Think about legal issues and ensure that details of any exports you make are entered on your VAT return. Get an export licence if you need one. Also organise your transport and arrange the necessary insurance and make sure you have the right customs paperwork.
Language and differing terms of trade are tricky problems to
overcome. Payment terms for overseas customers are also often
usually longer than at home. There may be a delay between the
shipping of your goods and the recovery of payment. This could
affect your cashflow. You also need to protect yourself against
changes in the exchange rate. A tiny variation could cost you
thousands of pounds.
Credit checks of overseas customer is difficult so you should negotiate credit terms and have them in writing before starting.
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