Published on August 13, 2021
Many firms want to export but they don’t know where to begin. These two exercises will help you realise if you are ready to sell abroad and identify improvement opportunities before starting.
Self-diagnosis
First of all, you can ask yourself some questions, and their answers will be useful to acknowledge how prepared you are and to identify in what areas you should work harder.
Have you ever sold your products or services outside your natural market? Exporting usually requires adaptation of your offer to foreign demand, due to different customer needs, culture, regulations or tax treatment. Therefore, if you have ever modified your product or service to serve clients that are dissimilar to your usual customers (e.g. from other industries or located in different cities), think about what you can learn from that experience.
How is your firm vis-à-vis other businesses that are already exporting? What do you have in common? What do they have that you don’t? Examining export strategies followed by other companies enables you to learn not only from their success, but also from their mistakes.
What makes you competitive? It’s important to reflect if the determinants of your domestic competitiveness are also a strength to go global or if, on the contrary, you should work on other aspects.
Do you have the necessary resources? Are you ready to satisfy a larger demand? Do you have specialised human resources? Could you easily find them? How are you planning to fund the internationalization process?
Is there any support? Many government agencies and business associations foster exports through financing, training, organizing trade shows and roadshows, among other instruments. Explore them to find out if you could benefit from any available tool.
SWOT analysis (strengths, weaknesses, opportunities and threats)
The SWOT analysis will help you identify and prioritise internal and external factors that have a positive or negative impact on your business’ competitiveness.
On the one hand, consider the firm’s characteristics that might have influence on the internationalisation process, such as human resources, management skills, flexibility, resilience, innovation, best practices, reputation, strategic alliances, among others. Then, you will be able to better enhance your strengths and correct / mitigate your weaknesses.
On the other hand, examine factors beyond the firm’s control that also impact on how to sell abroad. Some examples are the macroeconomic and regulatory environment, time zone, cultural and language similarities, available financing instruments, IT infrastructure, market trends, etc. The conclusions of this analysis will contribute to identify how you could benefit from the opportunities and how you should prepare to face the challenges.
In conclusion, these two exercises are a good starting point to define your firm’s positioning and the first steps of the internationalisation process. In future articles, I will come forward with some specific tools to select your markets.