be large to be able to afford the capital outlay necessary to begin exporting. However, a look at the figures indicates that a significant number of small businesses are exporters.
Success with regard to exporting is much more dependent on the availability of your product, whether or not your prices are competitive and, of course, the quality of your product. Such factors do not depend on the size of the company producing the good, and, in many cases, certain factors may be easier for a smaller company to guarantee. There are, of course, risks associated with getting involved in exporting. However, risk is part-and-parcel of business, and as a factor by itself should not serve to dissuade one already established in business.
Branching into international trade has the potential to significantly increase your sales-and your profits-providing, of course, that your products are decent quality. Once your customers realize the quality of your products and that they have a need for what you provide,assuming that your prices are good and you can continuously provide the product at this price, your profits will increase, thereby allowing you to expand further, if you wish to. You will also be expanding your customer base, and gaining increased market knowledge, all of which will serve to enhance your prospects where expansion is concerned. By trading in a variety of different marketplaces, you will also be distributing your risk more evenly. If sales drop in one market, they may be picking up in another, thereby offsetting any potential losses. If you had remained just a domestic trading company, you would risk being entirely at the mercy of the conditions in that one market alone. Diversification can pay off-in more ways than one. This will, in turn, give you solid potential for steady, long-term growth-the holy grail for any business-whether large or small.
That said, it is generally a good idea to ensure that you are steady in your domestic market before you even think about getting into exports. After all, if you are struggling to maintain a market share at home, what are your hopes when faced with increased demands and pressures? Also, it will be considerable easier to trade in foreign markets with a more established name, as this carries with it reputation and goodwill-two vital components of business anywhere.
Finally, an important consideration is that exporting products can lengthen their life-span. The usual product life-cycle is growth-maturity-decline, and your product could be at any of these stages in a number of markets all at once. By continuing to expand, you can keep your product in markets where the market is still in the “growth” stage of the cycle, thereby raising profits and outlook.
Written by Alexander Grimes