Exporting internationally: planning your route to market

When you start exporting internationally, you’ll need to take some time to consider what your route to market will be. Just as important as choosing what to sell will be deciding how to sell it. It is important to keep it as simple as possible for your customers to discover what you are selling – and then to buy it.

Selling online as a route to market

One way to reach overseas customers is through an e-commerce website. You’ll set yourself up as an online business and allow your international customers to buy from you through your website or e-commerce platform.

Pros

• Global connectivity and security options have improved meaning that is safer and easier to sell online than ever.
• Buying online is commonplace with most consumers.
• There are a range of e-commerce platforms and template website providers that make setting up quicker and more cost effective.
• Can be open 24/7 which enables you to operate across different time zones.
• Your customer won’t have to travel to access your product, it’ll just get delivered to their door.
• You retain control over your product and pricing.

Cons

• There are a lot of online shops available, so you may have to invest in some focused marketing to ensure people are aware of your brand.
• Some customers may be deterred from buying goods that they can’t feel or try before purchase.
• Some demographics are wary of buying online for fear of fraud, so you might have to consider who your target audience is and if this platform is relevant for them.
• You’ll need to make sure your product will be able to clear customs at the UK border and theirs.
• You will need to be aware of delivery costs and build this into your pricing strategy when exporting internationally.

Selling to retailers

You might want to consider working with pre-established businesses in the country and ask them to sell your products in their stores. You’ll get the benefit of moving into a trusted brand and getting your product known to the customers in the area, without exporting internationally on your own.

Pros

• Selling your product to retailers such as high street supermarkets will give your product high visibility and access to a wide audience.
• Retailers will already have an established client base, so you’ll be able to target these, rather than focusing your energy on creating product awareness.
• There is less outlay and pressure compared to owning your own shop.

Cons

• Retailers are in a powerful position and may not offer you a good price for your product.
• You may have to be prepared to operate with a smaller profit margin.
• You will have to sell your product to retailers at a lower price compared to selling direct to customers via your website, as retailers will mark up the product price.

Selling to wholesalers or distributors

Much like an existing retailer, distributors or wholesalers act as the middle person between you and your customer. However, they’re much bigger than retailers, so you’ll be able to sell more products in one go.

Pros

• Provides an easy way to sell larger volumes, as you’re providing products to one business, rather than transporting it to various locations across the country.
• Distributors may already have an established customer base, which you’ll be able to sell into.
• They should also have sales and marketing expertise, so they can take your products and promote them in the most effective ways.
• You won’t need to find access to storage space, as your distributor should already have premises they use.

Cons

• Selling price will be considerably lower than selling direct to a customer, or even to a retailer.
• You’ll have no opportunity to build a personal relationship directly with your customers.
• You may lose control of the way your product is marketed and priced, potentially damaging or erasing your individual business brand.

Sales agents to support you in exporting internationally

Sales agents are useful if you have a niche product and you would like help selling it. Agents typically have a field of expertise and they have a portfolio of different products that they try and sell. They’ll have a good understanding of the target market in that country, and will be motivated to sell your product as you’ll be giving them commission each time they make a sale.

Pros

• Sales agents work on a commission basis, so they’ll be highly driven to sell your product.
• They may already have an established client base, which you will be able to sell into.
• You won’t have to spend time and resources on recruiting your own sales force which could save you money.
• Unlike selling via a website, the customer will be able to try the product.

Cons

• You may have little control over how your product is described to your customers, which could lead sales agents misrepresenting your brand.
• You will still be responsible for shipping your product for them to sell.
• You won’t have a direct relationship with your customers.

Opening an international premises

If you’ve been selling online for a while and have been successful in one country, you might consider opening a shop there. Or, you can dive right in and open a shop in a new country based off your research of their market. This route to market will mean your customers will get that personal touch and will be able to experience your product before they commit to purchase. If this option appeals to you, you might also want to think about manufacturing there too, cutting out the need for exporting internationally entirely.

Pros

• Personal interaction with customers can get you regular customers, but you will have to rely on your staff overseas to establish this connection.
• Useful for products that your customers might want to see and touch before they buy.
• Your shopping environment can be used to establish your brand values and encourage customers to browse, which could lead to further sales.

Cons

• Could be costly, as you’ll have all the costs associated with running a premises.
• This could be stressful to maintain if your market is overseas, as the distance may make it difficult to keep up to date with any issues.
• Customer reach could be limited by geographical location and opening hours, which an online shop doesn’t face.

Summary

By considering what your route to market will be when you start exporting internationally, you’ll be able to make sure you are reaching your target audience, securing profitable new customers, spending less but selling more, and building strong connections in a new market.

See our page on finding an export marketing for your business or head to GREAT Britain and Northern Ireland for more resources.

Get support for your business to start, grow and scale internationally with York & North Yorkshire Growth Hub – contact us today.