Below is the final extract we will be publishing from Laurel Delaney’s book “Exporting: The Definitive Guide to Selling Abroad Profitably.” This book was published in December 2013 and is available for purchase online. If you would like to find out more about the author, the book, or about exporting in general, Laurel’s blog is an excellent source of information.
Where Do You Want to Go?
Keep your analysis of markets that you want to pursue to one page and break it into four manageable parts (use a, b, c, and d below). The purpose of this exercise is to establish a broad scope for your research-market analysis but not so broad that you overwhelm yourself. Try to begin with the end in mind: where do you want to go and how will you know that you have arrived?
A. Select the top-three most penetrable overseas markets that appear to have the best potential for your product or service offering. You can conduct market research online; meet in person with an international trade expert (see the SBA’s “US Export Assistance Centers”); or test your product or service by exhibiting at a local trade show. Trade shows give you access to potential customers from all over the world without you having to analyze a thing. For example, if you sell hardware tools and exhibit at a hardware show and find that you get a lot of interest from attendees from a particular foreign market, such as Australia, you would know there must be a market there, because why else would these attendees be asking for information? From there, you can address those inquiries, learn as you grow, and conduct further research.
B. Analyze the market factors and conditions in each of the selected countries. Delve into each country further by reviewing cultural attributes, geographical characteristics, political stability, demographic characteristics, market size, and growth rates. The goal here is to conduct a sound assessment of a foreign market. What might the barriers be? What makes it a good market to enter? How will the local culture influence the sales of your product or service offering? Such in-depth market research information is necessary to make sound marketing decisions and it must be done with each new market entry.
C. Determine the pros/cons to conducting business in each market. Look at potential language barriers, legal restrictions, logistical challenges, and payment problems that might get in the way of doing business in a particular market. Include all relevant variables in your assessment. Do an analysis of your company’s own strengths and weaknesses in a selected market. Will your product or service offering be in the low-, middle-, or high-end pricing level? Is there a similar product or service offering currently available in the selected market? If so, who is making it? Where are they based? Can you compete? Why would you? How would you? The more pros you have for entering a new market, the better your chance for success. If you can draw on the perspective of a native (better yet, an actual prospective customer) of the country where you are keenly interested in doing business, do so. Nothing beats an on-the-ground assessment.
D. Select one market to get started! Now you are ready to interpret your findings in light of the stated objective: where do you want to go and how will you know that you have arrived? (This gets back to the back-of-the-napkin plan.) At this juncture, you should have enough data and experience (from going to trade shows, for example) to decide which market is best for you to begin in. Hold off on the other two countries and don’t start doing business with them until after you have a proven success with the first overseas market. If the first selected market doesn’t work right away, say after six months or a year, move on to market No. 2, and so on. Don’t muddy the waters. You don’t want to do too many things at once because you will end up not doing any of them right.
The Laurel Export Business Plan
The following plan—I’ll call it the Laurel export business plan (LEBP)—has worked well for many of my clients. You can focus on each section heading and then build out accordingly based on the questions I pose and comments I make. What many clients experience as they develop an export plan is the eureka moment: “I can do this!” The trick is to craft a plan that suits you and can absorb economic shifts and shocks along the way yet still allow for you to achieve successful results. And it can’t hurt for you to use both the traditional business export and Laurel export plans to develop yours.
Tip It is important to identify where the cash will come from to support your export operation. Conduct a complete audit of your cash situation so you are not surprised later on to learn you need more money than anticipated to reach a new overseas market. Face weak links and potential problems before you are knee deep in a fantastic opportunity.
- Introduction: Compose an explanation why you should export and what your company wants to gain from exporting. Your answers will serve as your guiding light and foundation for your entire export business plan.
- Executive Summary: Specify your long-term financial and non-financial vision for developing an export business. Think three, five, and ten years out. This part shows clarity of purpose, direction, and intent. It is an understanding of the company’s identity and a short, concise picture of the company in the future. Think of it as an entire business plan in miniature.
- Strategic Leadership: State your leadership ability clearly. Do you have what it takes to drive results for your export operation? (Refer to Chapter 1 for a refresher on the global mindset.) The business owner must have the ability to set direction, make decisions, and provide long-term planning.
- Company Description: Explain what do you do and why are you good at it.
- Target Export Market: Identify your customers in _______________ (pick a target export market). Think about what would motivate them to pay for your product or service and if they will be able to afford to pay for your product or service. Drill down to a more precise view of your target audience. Caution: Are you crystal clear on who your customers are and why they use your product or service? If not, go back and do a major rethink!
- The Competitive Analysis (Market and Customer): Distinguish how your product or service is unique, and explain briefly why people in a selected export market would buy it. Do you know the strengths, weaknesses, strategies, opportunities, threats, and financial status of your top five competitors? Spell them out.
Want to find out more?
The full Laurel Business Plan can be found in Laurel Delaney’s book, Exporting: The Definitive Guide to Selling Abroad Profitably. The full content from this section of the book will include more information on the marketing and sales plan, the operations plan, the information technology plan, a logistics plan, management structure, future development, financials and strategy implementation. This is the last extract we are publishing from Laurel’s book. If you enjoyed the extract and want to find out more about the things to consider when writing your export business plan, Laurel Delaney’s book is available for purchase on Amazon, Barnes & Noble and Apress.
Additional posts on exporting:
- Thinking About Exporting? Let’s Examine Your Export Business Plan
- The Pitfalls of Not Having an Export Business Plan
- Three Types of Export Business Plans – a Detailed Breakdown