Expanding Internationally

Growing your sales through import and export

Businesses who import or export have significantly greater growth prospects, with the potential to offer increased sales and improve their competitiveness. As soon as your business begins to import or export, you’re increasing the chances of success as you expand your business.

Importing goods from overseas can help improve your cost base, while expanding beyond your domestic market can mitigate the risks of operating just in your domestic market, providing new opportunities to grow.

Importing: what to consider

The first thing to do before you start to import is research. Our useful guide to importing includes what research you should undertake and the import documentation you’ll require.

Some of the key points you need to consider when importing include:

Is there a need for your product? Take the time to understand who your target customers are and what they require or find out if sourcing goods are cheaper offshore.
Spend time getting to know potential suppliers and where possible, visit them directly so you can see who provides the best product and quality.
Research the countries you'll be importing from, because it can make a considerable difference to your costs.
Look at the currency you’ll be charged and if there will be any impact from currency fluctuations.

Determine the minimum quantities to order and what the production time will be
Get a clear understanding of the restrictions and regulations that may affect goods when they arrive
Minimise trade disputes and misunderstandings by reading up on the Incoterms rules
Look at the duties for what you’re importing and where you’re importing goods from

Exporting: what to consider

If you’re looking to operate beyond your domestic market, then there can be differences you’ll need to consider. To get a good understanding of the markets you want to expand into, it’s important to undertake some preliminary work first to increase your chances of success. There are a number of considerations that will have an impact on how you grow and operate your business, so we’ve created a useful guide to exporting to help you minimise the risks.

You should:

Make an export plan that looks at the potential risks and benefits
Only consider markets where there is a customer need and growth potential
Decide on the currency you’ll charge for your products or services and any impact that currency fluctuations may make
Get familiar with the regulations and requirements you’ll need to follow to operate overseas

Before you make any serious investment, prove that export can be profitable
Set aside budget for market development while you test your level of success in the international market
Have in place the right skillset and a financially stable position to establish yourself from

By far the greatest challenge facing SME's importing and exporting today is currency volatility. Bibby Financial Services, Trading Places Research, Dec 2017

Minimising your risks

Any businesses should always balance the potential rewards from importing and exporting against the risks whenever making decisions. A key aspect to consider is exchange rate fluctuations, particularly as our Global Business Monitor report shows that a key barrier to importing and exporting for SMEs is the impact fluctuation can have on profitability and cashflow.

To help you minimise the risks of importing and exporting:

Take a structured approach that involves using the services of a one-stop shop of experts
Make a decision on how to price your goods or services and if this will be in the local currency
With some currencies more volatile than others because of their unstable economies or inflation, always build currency fluctuations into your margins

Protect yourself against foreign exchange risk if you’re trading in a foreign currency by hedging against exchange rate movements
Look at the option of an Export Finance solution as a way to help you grow your business

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Growing your sales through import and export

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