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 information on the upsides and downsides of international trade.
You can look at importing new products and raw materials which can help give your business something your competition does not have. You can find new export markets which offer a host of opportunities in emerging and expanding markets. Another option is to manufacture some or all of your products in a foreign country and utilise lower labour costs.
By selling your product or service abroad you could grow your revenue and profits and become a bigger business - there are huge export opportunities in emerging markets and developed nations for a wide range of sectors. With importing you can find lower priced goods overseas because of lower labour costs and different tax regimes in certain countries. You can also find higher quality finished products to help your business grow and develop. You can take advantage of the traditional skills and raw materials available around the world to add authenticity and originality to your product offer.
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. Transportation requirements can also be costly and legal and product regulations will be different.
You should start with market research to help you identify and evaluate the target markets where your business can succeed. Look at what you can import, how it can help your business, what the predicted demand in your target country for your exports is, whether your product is suitable for export, the potential of developing your own manufacturing arm, where the best location would be for this, what labour costs and supply are like and what the legal and tax implications are. Talk to UK Trade & Investment who can offer a range of support and will put you in touch with your local trade advisor. Visit their website for a wealth of practical information and a guide to what High Growth Markets present the best opportunities. Take note that grant support is available for investigating new market opportunities - but still remember to set a realistic budget for your research.
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