By Perry B. Newman
Nov. 18, 2010
International business is a contact sport in which others are already selling to your potential customers; in which competitors are providing services to the clients you hope to reach, and others are providing technology solutions to your potential users even as we speak.
Precisely because there are competitors who are successful in the very markets you seek to crack, your success in those same markets will depend upon more than quality, service, technical superiority or even a favorable price.
In fact, companies and entrepreneurs that succeed in export markets have something else in common. They have a plan both to explore and to follow-up on export prospects and they are committed to the effort. If they don’t have a plan, and if they haven’t committed the necessary human and financial resources, they don’t pursue international market opportunities unless and until they are ready.
Why do so many would-be exporters dabble in global markets? One reason is that opportunities to travel to new markets frequently present themselves in the form of trade missions and trade shows. Given the opportunity to test the waters, many companies take advantage of the chance to meet potential customers.
Few such companies achieve sales, however, because they haven’t properly priced their product or service, considered the intricacies of shipping and logistics, arranged for service after the sale or even taken the time to understand the competitive landscape. So they travel and come back more informed, but no closer to a sale than they were when they left.
Another reason companies pursue global markets before they’re ready is that it’s human nature to hope for the best. It’s the same reason people purchase lottery tickets. Somebody has to win, right? So they pack up their company literature, get on the plane and hope they’re in the right place at the right time.
Not much of a strategy.
In fact, companies and entrepreneurs can maximize their prospects for success by remaining mindful of just a few key concepts. Here, then, is what we might call the First Law of Export Success:
“Don’t take the flight if you can’t do it right.”
Don’t invest time and money in travel and export development, and don’t distract yourself from core business activities unless you are committed to the effort. It will take more than one visit and more than one meeting with a new contact in order to demonstrate credibility and develop sales. Have you done the market research? Have you priced your product or service competitively? Are there regulatory considerations? Shipping challenges?
Save money, save time and preserve your credibility by embarking on international market development initiatives only when you are in a position to succeed.
Suppose you’ve done your homework and are prepared to meet with potential buyers. You’ve assembled a credible presentation on your company. You can answer the questions a buyer is likely to ask. You meet with a potential buyer who seeks additional information. You commit to provide it.
When you return to the office, however, a pile of messages awaits. You need to put out the fires that have flared in your absence, but in doing so you are significantly delayed in responding to the foreign buyer.
Each day that passes without responding to the buyer erodes your credibility and before long so much time has elapsed that to respond would actually be embarrassing. Result? No sale – which leads us to the Second Law of Export Success:
“Follow-up is not a guaranty of success; but failure to follow-up is a guaranty of failure.”
Put another way, a company is not guaranteed success simply because it has made a plan to visit the market several times a year; but the company that fails to visit the market on a regular basis will almost certainly fail to sell in that market. Similarly, meeting with a potential buyer and performing well during the meeting is not a guarantee of success. Failure to deliver on commitments, however, is a guarantee of failure.
For the Third Law of Export Success we turn to no less of an authority than Sir Winston Churchill. Churchill had weightier matters to consider when he uttered these words, but they are nonetheless applicable:
“Never give in, never give in, never; never; never; never … except to convictions of honor and good sense.”
There are times when it does make good business sense to cut one’s losses and make a rational decision to focus efforts elsewhere. There may be reasons why it’s best to favor a domestic market over a foreign market. But deciding to forego international opportunities should be the result of good sense rather than impatience or frustration.
Export development takes time, and there are many moving parts and variables, some of which are out of the exporter’s control. Yet if a business is committed and if it acts wisely with respect to those things it can control, if it is persistent, it can succeed. New markets are accessible. Greater profitability and growth are within reach.
A company’s chances for international growth are dramatically improved if it sticks to its knitting and simply obeys the law – or rather observes the Three Laws of Export Success.
Perry B. Newman is the president of Atlantica Group LLC, an international business development firm based in Portland, Maine. Atlantica Group supports clients in the private, public and nonprofit sectors in their efforts to access new markets and develop global business partnerships. Atlantica Group is on the web at www.atlanticagroup.com.