How to Tap into Fruitful Markets

Most small businesses understand the benefits of expanding globally but normally have no idea where to start. Check out these expert tips to focus on the fruitful markets with great potential.
Ideas for small businesses to expand globally

Led by a Government drive, exporting has been steadily creeping up the news agenda and now sits at the top of ‘to do’ lists of businesses of all sizes. The message is clear: to achieve fast and sustainable growth beyond an individual and national level, businesses need to proactively enter new markets. But, with a whole world of opportunity: where to start? 

Entering Fruitful Markets

At FedEx Express we often speak with businesses shortly after they receive their first order from overseas. These businesses haven’t necessarily gone looking for international clientele, but in the digital age they’ve been offered a fantastic growth opportunity on a silver platter.

Of course they want to make the best of the opportunity, and are pleased to learn there is a wide range of support available, from governmental organisations to logistics providers. One of the key pieces of advice we offer is to explore the market in that country to gauge if there is further growth potential. This doesn’t have to involve a major financial investment, as jumping on a plane can be enough to gauge main competitors, market share and price points. This information in conjunction with local support and data insights can provide a much clearer picture of the opportunities available. Even just using the internet to research important market information is a great place to start.

To help businesses, we’ve drawn on our years of exporting experience to detail the markets of opportunity, as well as provide advice on overcoming the main challenges, particularly in the healthcare, high-tech and fashion sectors.

1. Healthcare Advice:

The majority of healthcare companies already require a global mindset given the nature of the industry’s supply chain, making global expansion a more logical and instinctive move than in some other industries. The key is to explore where the strongest demand exists for your products and/or services and to be as flexible as possible when entering new markets, staying fully informed of the potential complexities of this innovative and ever-changing sector.

When exporting, specific clearance and regulatory requirements should be identified, understood and factored in. Note that these can change at an alarming rate depending on which market is being entered. Make sure you gain clearance up front and ensure full descriptions of pharmaceutical products being transported are given to ease the process.

There are several “fruitful markets” for healthcare companies at the moment. Dubai, for example, is a very healthcare-focused city-state with many people traveling there for treatment from overseas. Japan and Korea are also worth considering as their respective Governments are investing a great deal in the private healthcare sector, diversifying the market and inspiring growth[1].

Elsewhere, China is the third largest healthcare market in the world, and has experienced growth in the double-digits[2] and thus cannot be discounted. You’ll need to bear in mind that China is well-known as an attractive market and that you may face stiff competition, as well as potentially stringent regulatory barriers. Healthcare markets in both Brazil and India are also booming[3], with an increasing amount of potential for companies to explore. Although complex from a regulatory perspective due to dangerous goods complexities and import clearance processes in these markets, they are worth considering as the rewards could be plentiful. It should further be noted that for some countries such as Brazil, all shipments containing products for resale do require the recipient to engage a broker for the clearance process.

In all of these markets, having a thorough understanding of the culture and its approach to doing business is vital. While things like business etiquette may seem relatively minor, not following the correct protocols could be a deal-breaker. That’s why it’s a great idea to speak with a logistics provider that specialises in the country as this will give you on-the-ground insight.

2. High Tech Advice:

If you are trading in automotive parts or other high tech goods then understanding the prospects and where the main manufacturing bases are located in the world is important. Gauge if it’s worth producing a part of your product or its entirety overseas or whether domestic manufacturing and consequent exporting is worthwhile in terms of potential cost. Outsourcing business or IT services by implementing a near-shoring model is also worth considering.

If you do decide to manufacture overseas, it is wise not to choose a country but to pick a supply chain where it is cheaper and more economical to build. The high-tech sector is defined by its research and development, and considering some of the world’s most technologically advanced nations including China, Singapore but also the Netherlands is a good place to start. This is because these nations have established and accessible infrastructures in place that can help you get to market as quickly as possible. That said, emerging markets in Brazil and India are rapidly coming to the fore and offer a very viable alternative to the established markets. Don’t forget to factor into your decision the fact that products made in certain countries like Britain and Germany are often held in high esteem.

When it comes to exporting high-tech materials or products, make sure the value of the shipments are declared. If a high tech product is shipped complete, a list of parts is unnecessary. If it is incomplete then parts should be identified by their individual part name and value. That said, it should also be communicated if the assembly of a product differs to the origin of key components and can therefore be depicted as, for instance, manufactured in the UK, assembled in China. The country origin of each part must be communicated and is usually determined by the location the last major operation was conducted.

3. Fashion Advice:

In the fast-fashion age, an efficient supply chain is absolutely invaluable in getting the latest designs to market quickly, both at home and overseas. Using the UK as an example, by capitalising on the growing appeal of “Brand Britain”, the UK fashion industry has already seen huge growth from ecommerce. First time apparel exporters should consider exploring European markets as a first step. Given the current Free Trade Agreement and short transit time, it is a natural first step to take.

Further afield, the US is the fruitful market to enter and it is worth taking note of the “fashion hubs” – New York and Los Angeles[4] – and targeting accordingly. When entering any market, consider the price point carefully. If you are exporting to a market with a taste for high-end fashion such as the UAE, consider your value proposition before getting started.

The perceived high quality of products from well-regarded fashion hubs, such as the US or UK, is important. Even if an American or British product is manufactured in India and transported back to the US or UK before being sent to a particular market, the perceived quality of the product should still provide huge appeal. You may even consider building a sense of origin from the fashion hubs into your branding, for example by sewing a “made in Britain” tag onto each garment.

It’s vitally important that you take customs clearance into careful consideration. For example, you will need to declare the exact textiles used to create each garment based on their percentage by weight; the stitch count should be considered for knitted garments; gender, construction and garment design also play their part. Additionally, consider how to receive the duty and tax on each product as there are certain complexities in Canada and limitations regarding exporting apparel to the US given the complex paperwork required. Customs can be fiddly, but with support and guidance from the right expert, can actually be quite easy to manage.

Exploring New Areas

Whatever your industry, it is worth taking inspiration from further afield when growing your international presence. There are countless export opportunities out there and sometimes what seems like the ideal market, might not be as ultimately fruitful as other, lesser-known ones.

Gain guidance from experts locally in both your home country and chosen country to export to. It is important to have the correct network in place so demand can be met and most importantly grown, so your business can realise its potential and become a true Export-preneur!

[1] Export.gov

[2] Chinabriefing.com

[3] Healthcare in Emerging Markets: Challenges & Opportunities

[4] City Lab

   E-Commerce