Are you planning on selling to customers in an overseas market? There are export channels galore to choose between – but which ones are right for your business?
Generally, there are two ways your business can go – direct exporting or indirect exporting (or both). No matter which route you take into a foreign market, you’ll need to:
Exporting to customers directly provides you with greater control over your export process, potentially higher profits, and a more personal relationship with your overseas buyers. However, direct exporting requires more time and resources than indirect exporting.
The Internet has made direct selling to anyone in the world the norm. Many businesses now have their own websites – or at least a presence on the web – where they can sell their offerings.
Will you use Internet-based selling (either on your own website or via an online retailer) to international markets? If so, your business will need to:
Another option is to use sales representatives.
You’ll still need to get your products into the hands of consumers after the sale is made, typically via direct shipments.
It may make sense to set up an offshore branch or to buy an offshore distributing business, giving you a foothold in your new overseas market.
The biggest advantage of setting up an offshore branch is having a local presence. However, you’ll incur costs associated with opening and operating a remote branch – and you’ll still need to export your goods in accordance with all applicable export regulations.
Selling your goods through an intermediary can be a cheaper – and faster – way to get your offerings into new markets. Intermediaries are usually distributors or agents based in your overseas target market.
Although indirect exporting is usually faster and cheaper than direct exporting, you may need to help support the marketing efforts that get your offerings to intermediaries. Intermediaries will take a margin on your profits and you won’t have any direct contact with end users.
Indirect exporting options include:
With so many export channels available, diving into a foreign market can feel overwhelming. Start by determining whether a direct or indirect exporting approach (or both) is best for your business and go from there.
As you evaluate your options, you may need to test the waters to find the best way to get your goods or services to the end user. After your initial export channel is up and running, you can then consider adding more.
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