The Federation of Small Businesses (FSB) has recently released a factsheet to help small businesses (SMEs) gain a foothold in overseas markets. Businesses looking to export for the first time are advised to pick up a copy of the factsheet and study it thoroughly before attempting to enter new markets. The importance of increasing the amount of exports was highlighted in this week’s release of UK economic trade figures.
The release showed a trade deficit of GBP3.3b (US$5.3b) with the EU in goods and services. This gap has been longstanding and needs to be narrowed as part of putting the UK economy on a firmer footing and rebalancing the overall trade deficit. If businesses that say they want to export did so, GBP792m could be added to the economy annually, according to recent FSB research. Here are a few tips from the fact sheet:
Gain an understanding of a country before you export to it.
Different countries have different documentations, such as tax documents, and every country has dissimilar customs as part of their culture; some have different customs in different regions of the same country. A business should have a good understanding of these differences before moving on to sell in the country. To help first time exporters, the HM Revenue and Customs (HMRC) can provide you with several different examples of foreign documentation.
Gain an understanding of your customers
Saturday and Sunday are not weekends everywhere in the business world. Gain an understanding of the particular commercial deadlines and customs of potential customers so you will be on the same page for deliveries and other business transactions. Check to make sure a customer or business associate can pay for the goods you export on a timely basis. Ask for prepayment or an Export Letter of Credit through their bank if you have any doubts.
Gain an understanding of supply and demand in the country you are thinking of exporting to.
What works in the UK may not work in overseas markets. Other countries also have different rules concerning advertising and marketing. Understanding where you are going to do business is as important as a good business plan. Be confident there is demand for the product or services you will be supplying and aware of the competition you will be facing. The Passport to Export scheme offered by UK Trade and Investment helps first time exporters.
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