Increasing sales through exporting is easier than you think

Director of the Center for Economic Vitality

John owns a local food processing company that makes candy. His 20-person company had been steadily growing for the past five years until the recession hit and his company lost 50 percent of its customers.

John cut costs, went onto Shared Work to keep his trained employees and attempted to expand sales with his core customers. John realized that his local and regional customers weren’t likely to come back for many years, so he looked for new markets to expand his sales.

The logical place was to look north to the British Columbia marketplace. John worked with the Center for Economic Vitality to research the competition, packaging needs and identify prospective wholesalers that would help open markets for his products.

John visited a number of the prospects and helped the wholesalers close sales a few times a month during the past year. His sales grew quickly and soon surpassed his 2008 sales revenue. Exporting has become more than 50 percent of his sales and he is now looking to expand into other provinces and Asian markets.

Exporting can be a great opportunity to expand into a new market, increase sales, and grow your business. With our proximity to British Columbia and more than three million people, exporting to Canada and the Lower Mainland are real options. However, many businesses see the prospect of exporting as a daunting task because they believe they are too small, or the regulations too arduous.

On the contrary, size shouldn’t necessarily factor into ones decision to export or not.  Nearly 97 percent of all U.S. exports are by small- to medium-sized companies. International opportunities are growing as foreign economies grow and connections abroad become easier and more common place.

Canada is Washington state’s number one trading partner for non-aerospace and non-agricultural products (NANA) with more than $1.3 billion worth of products sold in the third quarter of 2010. These exports were more than NANA exports to China, Korea, and Japan combined.

There are many advantages to exporting for the right business in the right industry and into the right foreign markets. Exporting has become more of an option for small businesses, especially ones from Whatcom County, so how does one know whether exporting is right for their company?

The first phase is to look internally: Does my company have the capacity and desire to expand sales internationally? Am I, as the owner or leader, ready to commit to supporting expanded sales through exporting? Are my core business functions set up correctly and running smoothly? Do I have the staff, key contacts and support to expand? Self assessment is a key component to getting ready to export.

The second phase is research. Some common questions include:

• Is there a product similar to mine already available in the foreign market? What is the competitive landscape there? What is my unique selling niche?

• Who are my targeted customers and how will I reach them?

• How will I sell and distribute my products? Internet sales, retail locations, wholesale partners, or specialty markets?

• What are the cross-border regulations, tariffs, or packaging requirements?

• What are the capital needs necessary to expand my sales internationally?

• What price will I charge and will the distribution channels support my pricing strategy? How will my prices compare to others? Are there adequate margins, value and product differentiation to be successful?

• What are the legal and tax ramifications of earning revenue in a foreign country? Are my current advisors skilled in foreign tax and legal issues?

These are a few of the questions that should be researched as a new market is considered. Specific issues will arise as you grow and pursue foreign sales.  Having a good team of advisors is important to international success. The most important part of expanding internationally is to be prepared and have enough knowledge to make decisions when necessary. Find support to increase your knowledge and awareness of the ins and outs of exporting.

Is it time your company jump-started its sales through exporting?

The CEV has a number of services specific to getting started or expanding existing export sales: matchmaking to find qualified buyers of your goods and services; research about competition, market regulations, target markets and prospects; one on one technical assistance to support all aspects of international sales and their effect on your business (access to capital, personnel issues, sales strategies, and more) and students available from WWU to help in the research process.  For more information check out: or call the CEV at 733-4014.
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