Cutting the risk, cost and time to enter new markets for small business

Many companies export their products. But are many more who could but don’t. Why? Well, sometimes it’s because the product or service is, for one reason or another, thought to be unsuitable for foreign markets. Much more often though, it’s because it is simply not commercially viable for the company concerned to set up the required export infrastructure.

To see why this should be the case, consider the two traditional options open to potential exporters.

The first of these options is to establish a proprietary infrastructure complete with remote offices and administrative support. The cost of doing this, for obvious reasons, varies enormously, but a typical SME will need to budget the very minimum of £100,000, and almost certainly more. It is not a trivial sum.

The alternative is to use a distributor. This is less expensive in terms of capital investment and ongoing cost, but carries a price of a different (and equally damaging) nature: the effective loss of the territory and control of customers. Either way, getting into export is a risky enterprise.

And, as if these considerations weren’t worrying enough for companies looking to move into export, there’s the fact that new exporters can often run into financial trouble because they greatly underestimate the time it takes to start selling in new markets. Recent research commissioned by Winweb shows that 64% of exporters think they can reach new markets within six months. However, international trade commissioners who provide help to exporting companies, say it usually takes significantly longer than this. Underestimating the time, and thereby the cost, for setting up in another country has a significant financial impact on an exporter’s core business.

Now though, there’s a way of addressing all these issues. It’s an approach which lets SME’s hit the ground running - in terms of an export sales operation - by providing a proactive distributor, working in the exporter’s interests, backed by comprehensive, streamlined and efficient administrative support infrastructure. It’s a system which offers everything a company would expect from a local office, including a local address, telephone and fax number, call answering and order handling, development of distribution channels, marketing, PR and sales services, bookkeeping, cash flow, website, online shop and much more. This can be done by using SaaS - Software as a Service technology in connection with VAs - Virtual Assistants.

The benefits to exporters are enormous. With their own local infrastructure, exporting companies have full access to their own clients, and total control over the marketing activities used to develop their awareness of the products on offer. At a single stroke, companies will increase turnover per customer and decrease costs - the kind of scenario companies everywhere are looking for. This approach offers:

• Customer and product registration
• Customer care and 1st Level Support in the local market
• Complete business admin infrastructure
• Direct sales channel through online means
• Even finding the distributor for the products.

By using a VA - Virtual Assistant, you not only gain the local services, but also a representative with local business knowledge, but also local customs and traditions. David Maister writes also about this form of emotional intelligence.

Combine this with our OnlineOffice and you have a perfect ExportOffice.

Tags: Business Development, DHL, E-Commerce, Exporting, On-demand, Outsourcing, PayPal, Barclays Bank, SaaS, Small Business, smb, sme, sme-blog, Software as a Service, Virtual Assitants, Web Technology, WinWeb

2 Responses to “Cutting the risk, cost and time to enter new markets for small business”

1. David Maister
   http://www.davidmaister.com/blog
   
   Said on May 18th, 2006 at 11:06 pm

   Interesting post - and thanks for picking up the relevance of my remarks about working internationally. The world may be becoming flat, according to Friedman’s book, but it isn’t there yet! We all need help from someone to smooth our way in new cultures.

2. Stefan Töpfer
   http://www.winweb.com
   
   Said on May 18th, 2006 at 11:30 pm

   David,

   I think my aim has always been to help small business into new export markets, and make use of local partners. The internet has allowed some of my ideas to become real usable applications.

   But the cultural diffrences are still something people need to deal with.

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