Lesley Batchelor, director general of the Institute of Export (IOE), and Geoff Lippitt of PD Ports, explain how the right guidance can help businesses conquer overseas markets.
Having headed up the Institute of Export (IoE) for over a decade, there aren’t many business people as well placed as Lesley Batchelor to advise businesses on how to make the most of export opportunities.
And now, as we head into post-Brexit Britain, it has never been more important and more appetising for British businesses to expand overseas. The weakening pound has proven a boon for businesses and exports are soaring to record highs.
Whilst businesses must continue to focus on trading with key European countries such as Germany post-Brexit, the current problems with some eurozone economies continue to present major risks to UK businesses.
However, Batchelor believes forward-thinking businesses should be looking beyond the bloc towards the fast-growing BRIC economies of Brazil, Russia, India and China. She tells BQ: “We can no longer look just to the European Union for our sales, which is something we have traditionally relied upon, we must now look further than that.
“Having said that, there has never been anything stopping us from doing it before. Most people say it’s a lack of knowledge of how to do it, but if you look on the internet, there are a plethora of organisations, such as the IOE, which can help businesses get export ready.
“We teach businesses the skills they need to export, the problem is that people don’t treat exporting as a skill, they treat it as something we should know how to do instinctively. However, it is exactly like accountancy, the legal profession or even journalism, it needs to be taught.”
It is these skills that can help a business scale to the next level, or even on occasion, sink or swim. For the savvy businesses that manage to explore export opportunities and successfully penetrate new markets, it can make a huge difference.
“Exporting is a big step and it is something businesses need to commit to,” Batchelor adds, “once they do commit, we find that companies are 11% more likely to grow and have a sturdier product offering because they’re spending more time thinking about how the product will be received in another market and they spend more time ensuring they get the product right.”
So, you might be wondering, how can professional training and advice stand you in better stead to begin exporting? Well, there are many issues that can arise when expanding overseas and the majority of companies that trade internationally will tell you it isn’t as straight forward as you might first think.
“The first thing is to learn everything you can about a market,” Batchelor says. “Whether you think there is a market or not, you need to understand what the implications of doing business in that market are.
“That means looking at the compliance and regulations side of things, which sometimes can change a market. The Economist previously told us to look at Brazil, however when you actually look into Brazil, you find there are a lot of internal barriers facing exporters but there is a lot of support to set up manufacturing facilities there. It’s those invisible barriers that people need to be aware of when they’re researching a market.
“The second step is to work out how you’re going to price your product or service and how you’re going to get paid. This is something you can learn very easily, it’s not a dark art at all, but you would be surprised how easy it is to get wrong.
“You must also recognise that it is a different type of contract you’re entering into when you begin trading internationally and everything takes three times longer. You must be patient.
“When working with businesses from overseas, you must also respect their culture. A great way to work around this is by translating your website into different languages and making sure you can communicate with people easily. Research shows people are four times more likely to buy something if it’s in their own language.”
PD Ports is one of the UK’s leading port operators and helps thousands of businesses across the UK expand into new markets every year by offering supply chain solution support, whether it’s distribution, logistics or even container handling.
Geoff Lippitt, business development director at PD Ports, echoed Batchelor’s advice: “Exporting is set to become even more important for SMEs and we need to ensure we recreate the skills to ensure businesses can export technically as well as practically.
“That’s why we’re committed to working with the combined authorities, the Department for International Trade and the IoE, to support their trade initiatives both regionally and nationally and to continue helping businesses export.”
Lippitt also agrees that exporters may now find themselves in an interesting position as they look beyond the bloc, adding: “Whilst we have to concentrate on balancing and maintaining the relationship with the new European bloc, there will also be new markets which will provide exciting opportunities for businesses.
“What has been typical historically is that when exporting, people have chosen Europe as a safe first step as it’s easier to do. However, if the regime changes, you may have to go through the same processes whether you’re exporting to France or Fiji. Perhaps the opportunities lie further afield.”
Batchelor sums it up perfectly when she says: “Like Einstein said, ‘first learn the rules of the game and then go out and play it better than everyone else’. If you go to HM Revenue and Customs with a query then you consult an accountant, if you go to court you consult a lawyer, but if you send millions of pounds of goods all over the world you don’t tend to do anything.
We suggest people learn how to do it properly and become professional international traders which is what we help people do through our expertise, training and membership.”