Want to become a successful exporter? If you want to do business abroad, it pays to know what you’re doing.
If you’re a first-time exporter and want your business to spread its wings and gain customers in other countries, there are a few things you have to do to succeed.
It’s worth taking the time to choose your export markets wisely and get an understanding of key terms you’ll need to do business.
Once you’ve decided on your strategies and markets to target, you can put your plan in action.
And if you’re exporting to the European Union, you’ll need to take steps to prepare ahead of the UK leaving the EU.
The UK government website has advice on what you need to do get your business ready for Brexit.
When you start building the right relationships and improving your presence in other countries, you’ll begin to take steps in the right direction to become a successful exporter.
But what does one look like? Read this for 10 habits they have that you can adopt now, so you too can have success with exporting.
1. You track exchange rates on a daily basis
Some exporting deals can be negotiated by having your customer pay you in your own currency and some will want to buy in their currency.
However you do it, you will need to be aware of currency fluctuations as they will affect both you and your international customers.
You can track currency rates regularly and convert back to pounds when the price is right. You can also lock in a fixed price in advance from FX providers.
2. You get numerous calls every day from different FX providers
Once you exhibit at trade shows, the foreign exchange providers start to call offering you the best currency deals.
As with all suppliers, find three options that you can work with and then cross check them each time when looking to convert foreign currency back into your own currency.
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3. You have pound, euro and dollar bank accounts
If you export a lot and don’t buy your currency forward, it can be useful to have different currency accounts to hold money in until you are ready to buy back into pounds.
This can also be useful if you purchase supplies abroad as it reduces the number of times you have to switch currencies, which saves you money.
4. You use USD instead of $ in your emails
Using terms such as USD (US dollars) and GBP (Great British pounds) instead of symbols on your emails ensures there is no confusion when it comes to dealing with pricing.
5. You are on first-name terms with the top freight forwarders
Many export deals involve shipping to a UK-based freight forwarder, who specialises in shipping abroad. They usually consolidate all of the orders that your customer has made in the UK into one shipment to them.
Having good relations with these companies helps to ensure everything runs smoothly, all of the paperwork needed for export is sorted and your customer is kept happy.
6. You can accurately estimate a pallet size and weight by eye
Knowing how much your pallets weigh and what their dimensions are is what every freight forwarder wants to know from you, so get used to having this information handy.
It’s also important to be aware of safety requirements regarding the heights of pallets and weights of boxes. Some customers may have special requirements regarding the pallet construction and load capacities.
7. You’re staying on top of your cash flow
When dealing with international trade, there’s a good chance you’ll have to deal with extended cash flow cycles.
You may have a delay in payments coming through due to longer shipping times, for example. Taking this into consideration is important.
Stay on top of your cash flow by checking that goods have been received and payments are made. If they’re not, take the time to follow up. You can use good accounting software to help you manage your cash flow.
8. You check in regularly with the Department for International Trade
The Department for International Trade (DIT) is a government body set up to assist UK companies looking to grow through exporting.
It provides useful data and analysis on international markets and how best to approach them. The DIT has local trade offices all over the UK – set up a meeting with your local rep to start growing your export sales.
9. You understand the difference between ‘ex works’ and ‘free on board’
These two terms determine the responsibilities of sellers and buyers – this includes which party has to cover arrangements and costs when it comes to shipping goods.
10. You use the term ‘MOQ’
You will need to have a ‘minimum order quantity’ – or MOQ – in mind for export sales to make the whole process worthwhile for your business.
Often, distributors in other countries will want discounts, so it’s important to have an export price and minimum sales required to meet this price.
Conclusion on exporting
International trade can help you to grow sales for your business and scale your company too. Having a goal of becoming a successful exporter will be within your grasp if you put the right processes in place.
So put your export strategy in place, seek advice where you need it, get an understanding of the key terms you need to follow, and see where you can take your business.