Once you have established your business in Australia, it may be time to look overseas.
There are many reasons to export, not just the obvious one of millions more potential customers.
Why export
The major reasons why a business should consider exporting are:
Lower production costs: higher sales mean you can benefit from economies of scale;
Better products: keeping in touch with overseas trends lets you feed these back to your domestic market;
Increased competitiveness: determination and commitment is needed to be a successful exporter. These qualities, and the experience that comes with them, can help companies become more innovative;
Reduced risk: having export markets can help counteract an economic downturn in your domestic market;
Higher profits: some products command much higher prices overseas than they do at home. For example, abalone sells for much more in Japan than Australia; and,
A viable market: you may have a product or service that just doesn’t have a big enough market in Australia to make it worthwhile.
What country?
For your first venture overseas it’s best to choose a country where the cultural differences aren’t too great, and one that’s easy to visit. You might also want to choose a smaller country that’s easier to get to know and get around. For an Australian company, New Zealand would be an ideal place to test the waters. Or you don’t even have to target a whole country, you could start with just one city or region.
Cultural differences
Other countries have different ways of doing business than Australia, and a whole different set of what’s polite and what isn’t. It’s important to understand these before you visit. And even if you are useless at languages, every nationality under the sun is appreciative if you at least learn a few words in their language.
And don’t make the mistake of thinking that English-speaking countries are just like Australia. It was Oscar Wilde who said that the UK and the US were two countries divided by a common language. And it took one Australian woman ages to find out that she’d offended her agent in London by repeatedly refusing the cup of tea that was offered!
Be as aware and as sensitive as you can when it comes to cultural matters.
Relationship building
We all feel more comfortable doing business with someone we know, and that’s especially important when separated by oceans and thousands of miles. In Asian cultures especially, a personal relationship built up over the years is seen as being of vital importance.
Selecting an agent
The most important decision you will make will be to select an agent, distributor or importer. Make sure you thoroughly understand the differences between them and know which one is most appropriate for you. They will obviously be incredibly important to your sales in the country you are exporting to and should therefore be chosen with the utmost care.
Austrade
In real estate it’s all about ‘location, location, location’. When it comes to exporting, it’s all about ‘Austrade, Austrade, Austrade’.
Austrade is the commonwealth government’s export agency and has the most amazing amount of information and resources available to exporters (much of it free, some of which has to be paid for). It’s so incredibly helpful and efficient that it’s hard to believe it’s a government agency.
The first port of call for any potential exporter should be its website,
www.austrade.gov.au.
New Exporter Development Program
One of the most useful Austrade initiatives for small and medium-sized companies is the New Exporter Development Program
One of the most useful Austrade initiatives for small and medium-sized companies is the New Exporter Development Program. This scheme is designed for companies that are new to exporting or that have limited experience.
Companies taking part in the New Exporter Development Program work with an assigned export adviser over an 18-month period, and benefit from the following services:
• Assistance in selecting an export market(s);
• Export coaching tailored to the needs of the business; and,
• Twenty hours of assistance at no charge, delivered through Austrade’s overseas network in a maximum of two markets.
Export Markets Development Grant
Another useful Austrade initiative is the Export Markets Development Grant, which pays cash rebates to small and medium-sized businesses that have promoted their products in overseas markets. The scheme reimburses up to 50 percent of eligible expenses, less the first $15,000.
State assistance
The states also offer a lot of assistance when it comes to exporting. The following sites are useful:
NSW:
www.smallbiz.nsw.gov.au/smallbusiness/exporting
Victoria:
www.export.vic.gov.au
Queensland:
www.sdi.qld.gov.au
Western Australia:
www.doir.wa.gov.au/exportandtrade
South Australia:
www.exportsa.sa.gov.au
Tasmania:
www.development.tas.gov.au/export