Preparing to export

For first timers in export, the following seven steps explain  the export cycle; from promoting and marketing a product or service through to final delivery and payment.

The 7 steps to an export sale:

Step 1: Product or Service

• Is my product exportable?
• Is my company capable of exporting?
• Which markets?

Step 2: Canvassing and Promoting

• Market intelligence
• Visiting the market
• Marketing strategy and representation
• Developing business relationships

Step 3: Contract

• Incoterms
• Payment method and terms
• Product specifications
• Warranty, Service, Quality Checks
• Legal Considerations
• Company policy and responsibility

Step 4: Prepare Goods or Services

• Financing
• Production capacity
• Packaging
• Economies of scale
• Duty drawback
• Tradex

Step 5: Delivery

• Incoterms
• Freight: Air or Sea Transshipments
• Freight services
• Marine and credit insurance
• Documentation
• Timely Delivery

Step 6: Payment

• Company policy and responsibility
• Risk management
• Credit insurance
• Ownership transfer
• Payment method and terms
• Fees & Charges

Step 7: Review and Recognition

• Maintain relationships
• Continuous improvement
• Client service and repeat orders
• Market intelligence
• Monitor Changes
• New Opportunities
• Export Award

Is your company export ready?

For businesses and individuals planning to expand their sales into markets outside of Australia, a bit of research and review is necessary to confirm that you are on the right track, have picked the right market, and are properly prepared.

The following 5 step checklist while the list is not  exhaustive, is a good place to start.

1. An Export Ready product or service?

• Could your product or service be sold overseas as it is, or does it need modification, new labeling, adjustment to meet overseas consumer laws (examples: use by dates, ingredients)
• Will the pricing, including the costs of getting it to another market, keep it competitive against existing competition in that market?

2. Resources (The following can be either in-house or external support)

• Do you have a sales contract, enforceable in another legal jurisdiction?
• Is any Intellectual Property, design etc registered?
• Who will undertake the export documentation, organizing shipment by air/sea, customs clearance and appropriate packing for transit?
• Who will manage export sales and customer service for clients overseas perhaps with different language requirements?

3. Marketing

• What will the entry method be? (Direct sales via the internet, using a distributor or agent, setting up an office, obtaining a local partner, perhaps franchising)
• Developing marketing materials such as flyers, samples in different languages. Checking that any USP in the product is relevant in another culture, managing cultural differences.
• Sourcing support from Government and Industry groups such as the Export Market Development Grant for marketing expenses.
• Ensuring the business website supports the exporting effort (different languages, export pricing, different payment options, USP for different audiences)

4. Finance & Payment

• Ensuring sufficient working capital to fund a push into a new market.
• Get the payment terms right and use products like Letters of Credit, Collections, and Credit Insurance to protect receivables.
• Get the payment terms right and use products like Letters of Credit, Collections, and Credit Insurance to protect receivables.
• If selling outside AUD ensure the foreign exchange risk is properly managed to avoid losses.

5. Visit the Market

• Back up all the research with a visit to the market to assess potential first hand, meet possible distributors/partners, and assess the competition.
• Take advantage of Trade Fairs and Market Visits to get maximum value (Austrade and State Governments can assist).
• Undertake an honest appraisal following the visit before committing.

Once you have been able to review and respond to the points above, you will be well prepared for that foray into a new market abroad.

There are many additional things to consider under each stage, and that is why we suggest new exporters seek out the government and industry contacts that can provide that detailed assistance. For a full appreciation and understanding of the process, the Institute runs regular face to face courses led by industry experts that cover all the details, please visit the Australian Institute of Export for further information. If you are located in a regional centre or unable to attend during the face to face training, the Australian Institute of Export runs courses in an online format.

Austrade provides a program for new exporters called TradeStart. The Export Council of Australia had two TradeStart offices covering four regional areas in Victoria. To locate a TradeStart office close to you. To check the location and contact details of your nearest office please visit: www.austrade.gov.au.
 

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