For many SME’s the world of international trade can seem a daunting place full of expensive risks and complicated paper work. But for those that can overcome these hurdles they are able to expose their business to a near limitless world of possibility and opportunity. Taking advantage of these opportunities is a great way to enter new markets and expand your business. International trade in most large markets generates hundreds of billions and even trillions of Dollars(US) yet in places like the UK, only two out of ten businesses take part.
It’s like a finger pointing away to the moon. Don’t concentrate on the finger or you will miss all that heavenly glory
– Bruce Lee
Depending on your country there is a very high chance that there will be products which simply are not available to be domestically sourced, thus creating a market need. Your business may be able to take advantage of this opening by sourcing from abroad. Whether its mangoes in Alaska or oak lumber in Namibia. Conversely by identifying similar availability issues abroad for products you supply, you may be able to enter a brand new market with little competition to fulfil the local demand.
Many countries have specialised industries and products which have a prestige factor, making them desirable all over the world. Consider: French Champagne, Argentinean beef, Egyptian cotton, Japanese technology, Scandinavian furniture and Italian super cars. The brand image present in these products acts as a very strong marketing factor. Whether it’s making your own domestic high quality prestige goods available to targeted markets abroad or incorporating them into your own products and services to be supplied domestically, the power of reputation should not be underestimated.
Another strong advantage for importing or exporting is the cost factor. For importing, it is well known that many products or materials can be sourced significantly cheaper from abroad even with factoring in the cost of importing them. I.E textiles and sports goods from Pakistan, electronics from Taiwan or South Korea, Iron ore from Australia. Stevia from Peru. In regards to exporting it will depend on your home country’s own specialisms, production quality and costs, logistic ability and business structure. For a relatively small initial investment the future benefits for your company can be substantial. Selling your goods abroad can expand your business into new markets with fresh opportunities. Another important factor is that by diversifying your client base through a variety of international markets, you are also helping to protect your business from local downturns in any individual countries you may operate in.
As you can see, the advantages of dealing in international trade can more than compensate for the costs, but it will require commitment and a willingness to learn and adapt in a highly dynamic environment.
Trade is the natural enemy of all violent passions. Trade loves moderation, delights in compromise, and is most careful to avoid anger. It is patient, supple, and insinuating, only resorting to extreme measures in cases of absolute necessity. Trade makes men independent of one another and gives them a high idea of their personal importance: it leads them to want to manage their own affairs and teaches them to succeed therein. Hence it makes them inclined to liberty but disinclined to revolution.
– Alexis de Tocqueville