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foreign market entry

What to Research when You Want to Sell Your Products onto a Foreign Market

Exporting your items to a different country often seems like a great solution to gaining more money by enhancing your customer palette. Things are however easier said then done. To enhance your chances of success, you should document on the following:

1. The demand for your product
You should begin by assessing the levels of consumption and offer for the product you want to export. The ideal situation is presented when the levels of consumption are increased, but, due to various reasons (including national disadvantage), the actual offer is limited.

At this stage, you should also peg the necessity for the item to the cultural values of the country. You would for instance find that there is no need for beef based products in India. Additionally, you should also assess the buying power of the domestic population. What are their average incomes and what is the revealed affordability for the item I intent to export?

2. The domestic offer for the product
You would have to identify any suppliers offering the product you intent to market to the foreign market. You should then research their business particularities and identify if you can, in any way, top them. In other words, is your product able to differentiate itself from other similar items? Can you, for instance, sell it at lower retail prices? Does it have an extra functionality? And so on.

Another point to be cleared at this stage is given by the nature of the competition among domestic product providers. Is this competition intense or not so much? The fiercer the competition is, the more threats you will encounter.

3. Fiscal policies
You should begin this research process by determining if the country is part of any international organization, such as the World Trade Organization, or if it an integrant party of a regional agreement. You should then reveal the terms and conditions of the agreements. If it is part of the WTO, its policies and reforms are probably directed towards the elimination of trade barriers in the trade with the other WTO members. Similarly, if it is part of a regional agreement, it probably more efficiently trades with the countries in the respective agreement.

Following this assessment, you should move on to actually documenting the import policies implemented by the country. What fares and quotas do they charge on foreign products? To what category of imported goods does your product belong and what treatment would it be subjected to at the customs?

4. Distribution
Once your product is exported, it can reach the final customer through either of direct distribution or indirect distribution. Direct distribution occurs when the manufacturer opens a retail facility and directly sells its products to the end consumers. Indirect distribution occurs when the manufacturer gives the products to vendors, who then sell them to end consumers. Advantages and disadvantages are common to each option.

You should then assess several elements. For instance, is there a specialised network that trades the category of products you will be selling? What are the costs of using domestic intermediaries? Or, what is the expertise of the domestic intermediaries in placing and selling your type of product?

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