Let's suss out a problem in exporting at the small business level. It is a fundamental point that you have a solid domestic market before you export, and begin exporting only if an when export sales become no more difficult and every bit as profitable as domestic sales. (The MOQ FOB brings that point sooner.)
On element that makes your product attractive overseas is your success in a domestic market. It does not matter if no one in an export target market has ever heard of your product, all that matters is the fact you have been successful domestically. Selling in your home country is an excellent recommendation to buyers in a target country.
The fact you are successful domestically is the result of your hard work to make that happen. Branding decisions, channel research, labelling, packaging, the sum total of which resulted in what success you have found domestically. And for most people, this part was fun and exciting. (It is common for successful people to look back on "the good old days..." and forget the terror of not knowing and the anxiety of the overdrawn bank account.)
Naturally, when exporting into an alien market the unwitting assumption is "let's do it again." The idea is to repeat all of those steps, and then own the market overseas like one owns the market at home.
For conservators, this may be a good idea, for their products are commodities, like Starbuck's Coffee or Amazon Kindle. But for small businesses, the costs of marketing overseas plus the management of a foreign staff makes success or owning a market overseas highly improbable.
As a practical matter, the people an American relies upon to effect decisions overseas will simply listen to how much is being invested and play along to milk the process for all it is worth. On one hand whatever the small American company learns is of value for the local to execute himself, on the other hand success is unlikely so the goal is to draw out the process and maintain a sinecure as long as possible.
A better approach is to sell FOB, and let the buyers overseas position your product as they see best. You make a profit no matter what, they do all of the work necessary to build the market. They own the market, but they do all of the work necessary to build it at no cost nor risk to you.
For someone whose business is "his baby" this is hard to do. One can imagine all sorts of terrible things happening, although there are no real examples of these fears turning real. On the other hand, there are countless horror stories of small to medium USA enterprises finding disastrous results at attempting to go native and build a market overseas.
Remember, it is the home market that recommends your product overseas. It is that to which your importer/customer overseas is touting to grow the market. There is your point of control: your USA market.
Let people overseas be your overseas market development masters.
Feel free to forward this by email to three of your friends.
On element that makes your product attractive overseas is your success in a domestic market. It does not matter if no one in an export target market has ever heard of your product, all that matters is the fact you have been successful domestically. Selling in your home country is an excellent recommendation to buyers in a target country.
The fact you are successful domestically is the result of your hard work to make that happen. Branding decisions, channel research, labelling, packaging, the sum total of which resulted in what success you have found domestically. And for most people, this part was fun and exciting. (It is common for successful people to look back on "the good old days..." and forget the terror of not knowing and the anxiety of the overdrawn bank account.)
Naturally, when exporting into an alien market the unwitting assumption is "let's do it again." The idea is to repeat all of those steps, and then own the market overseas like one owns the market at home.
For conservators, this may be a good idea, for their products are commodities, like Starbuck's Coffee or Amazon Kindle. But for small businesses, the costs of marketing overseas plus the management of a foreign staff makes success or owning a market overseas highly improbable.
As a practical matter, the people an American relies upon to effect decisions overseas will simply listen to how much is being invested and play along to milk the process for all it is worth. On one hand whatever the small American company learns is of value for the local to execute himself, on the other hand success is unlikely so the goal is to draw out the process and maintain a sinecure as long as possible.
A better approach is to sell FOB, and let the buyers overseas position your product as they see best. You make a profit no matter what, they do all of the work necessary to build the market. They own the market, but they do all of the work necessary to build it at no cost nor risk to you.
For someone whose business is "his baby" this is hard to do. One can imagine all sorts of terrible things happening, although there are no real examples of these fears turning real. On the other hand, there are countless horror stories of small to medium USA enterprises finding disastrous results at attempting to go native and build a market overseas.
Remember, it is the home market that recommends your product overseas. It is that to which your importer/customer overseas is touting to grow the market. There is your point of control: your USA market.
Let people overseas be your overseas market development masters.
Feel free to forward this by email to three of your friends.
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