In 2014 Canadian exports rose by 5.7%, perhaps it is time for your business to get in on the action.
According to a study conducted by Sage in 2014, expanding your business by exporting overseas has proved profitable for the majority of small and mid-sized Canadian business that have chosen to conduct business abroad. However, for small businesses, expanding their export business overseas is a mighty undertaking that could upset existing business activities, if not done with prudence. In order to conduct business overseas it is vital to first acquire a thorough understanding of the targeted markets, the competition, plus current local market trends. If you do your due diligence properly there are many upsides to doing business overseas. In this article we will look at some of the key steps require so you can expand your overseas export business.
Firstly you should identify your target markets: doing thorough research on the countries you want to do business with should be one of the first things you look into. Developing countries are rapidly growing and should be included as they have emerging markets, a flourishing middle class that is more educated and has more earning power, affording them the capacity to consume goods and services more rapidly. By expanding your overseas business in these countries your business may be able to access untapped markets. Your company might be able to offer products or services that are unavailable in certain countries but are in high demand. In fact according to some sources, small businesses may be more adept and nimbler at adapting to emerging countries' needs than large businesses.
Secondly, you must research relevant regulations and rules: you will need to research tax laws, customs laws, import restrictions, corporate organization, and agency/liability laws as when you start exporting you may have to deal with red tape and you may need help to determine which countries are the best to expand your overseas export business into. Some overseas countries might offer lower taxation or other business incentives to encourage overseas companies to export.
Acquire a local rep: If you plan to expand your overseas export business it is vital to have a local liaison in each overseas market. Your local agent can aid you in developing the business by helping you to understand cultural differences, provide translation to avoid the language barrier and aid you with marketing according to local cultural norms.
Ensure you have the financing: expanding an export business overseas will demand additional capital. Your business's budget will change once you begin expanding overseas. You will have to pay for a wide gamut of new expenses, such as research, set-up charges, travel costs and other miscellaneous fees. The amount will depend on your approach to expansion; for example, you may save money if you decide to use an intermediary to export your products as opposed to establishing an overseas office.
If you are able to successfully expand your overseas export business you will definitely see increased sales and profits. Selling to multiple markets can allow your company to diversify your business plus spread your risk and reduce dependency on local market fluctuations.
If you plan to expanding your overseas export business the most significant hurdles will be extra costs, financial risks and gaining access to overseas market information. Whilst there are no hard-and-fast rules, understanding the pros and cons can help you to smooth entry into new markets, to keep pace with competition and eventually realize healthy profits.