Why International Trade May Be for You

There are many positive reasons for you and your company to consider international trade. The recent Covid global pandemic may have put you off the idea – perhaps because you believe that some countries governments will now show preference to internal supply chains, and that protectionism may continue to increase. Quite frankly the world has been trading across continents for hundreds of years, and this is extremely unlikely to stop. For example, Singapore must import 90% of its food requirements. Will countries like America & Japan give up drinking single malt whisky, or will French & Spanish consumers stop demanding Scottish seafood? Will UK consumers abandon German car marques like Porsche, Mercedes & BMW? The simple answer is no.

Here are some brief reasons for you to consider exporting your products or services, if you don’t do so already:

Growth Opportunity – exporting is a common and popular business strategy to grow your business. Perhaps your core products are in a mature market at home where sales have become stagnant? They may find a new lease of life in an overseas growth market. Or you may have a seasonal product that sells for 4 months of the year? Selling in one or two additional overseas markets (with different seasons to the UK) may help you achieve all year-round sales.

Spread Risk – my parents & grandparents used to always tell me not to have “all my eggs in one basket.” By operating in different countries and in different sectors you are spreading your risk. For example, an unfortunate downturn in domestic sales may be offset by growth in export sales. New products can also be tested in one market, before introducing to others. You may simply wish to import materials from other countries to extend your choices for your own supply chain, and to make your offering more globally competitive?

Economies of Scale – average unit costs may come down if you are producing higher volumes of products for extended periods of the year. (For example, squeezing more from your assets, and having increased purchase power for materials). One way to help you reach this utopia is to have more than one geographical market to serve. Can you imagine making sales whilst you sleep!

Exposure to New Ideas & Opportunities – visiting and working in overseas markets provides entrepreneurs with new business opportunities. I used to visit America frequently for research purposes because the US often leads the way whilst the rest of the world catches up. A few examples include the internet, out-of-town shopping malls, fast food restaurants, and rap music. I remember being in Helsinki in Finland fifteen years ago and the city was already a cashless society.

Grow Your Knowledge/Develop Your Team – exporting for the first time may appear daunting, but there is a lot of advice and help available in Scotland, and you can always buy-in expertise. Learning to export will make you a better manager, and your team (if you have one) should be energised by this kind of challenge.

Company Value – a company operating in international markets will likely be valued at a higher price than the same company operating in the domestic market only. International trade increases the prestige inside and outside a company, and you may find it easier to get support from third parties like banks.

Fun – international trade is not a quick fix solution and it takes time to implement successfully. Once you are established in your first overseas market you should be enjoying the experience. Meeting people from different countries and cultures is fun. Seeing different places is stimulating. To research markets properly and to establish productive working relationships (assuming you need to work with in-market partners like distributors), you need to visit these markets. International trade is all about collaboration and a positive output is the increased appreciation of different nationalities and cultures on a global scale.

Scotland the Brand – last and certainly not least, Scotland is perceived very positively in many overseas destinations, so consider embracing “Scottishness” in any international proposition. There are the historical & ancestral links and/or expat communities in North America (US & Canada), Australasia (Australia & New Zealand), Spain, South Africa, India, Dubai and many other places. There are other countries like Germany that simply like all things Scottish. (Germany is our second biggest overseas visitor after the US). School pupils in Russia and Hungary learn about Rabbie Burns in their education curriculum. There are Scottish pipe bands and Scottish societies in most parts of the globe. For seven consecutive years Scotland has attracted more overseas direct investment than anywhere in the UK apart from London.

The Benefits of an International Strategy Workshop

International Strategy Workshops (ISW) are an excellent tool for creating a strategy overview and action plan for ambitious companies. Perhaps you are interested in pursuing international opportunities, but you are not sure how to proceed or which markets to target? Or maybe you are servicing international markets, and believe that the time is right for a review including independent input and advice? An ISW is one of the most effective and popular services SMas offers for clients. With many years of experience, successful ISW’s have been delivered for clients in most industry sectors such as food and drink, textiles, beauty products, manufacturing, e-commerce and retail, sports, creative industries, construction, tourism, business services, and many more.

There are four key delivery stages to the ISW, as follows:

1. Pre-Workshop Questionnaire

Once a client has committed to an ISW, the SMas consultant drafts a tailor-made questionnaire, designed to gather key company information like owner/ management aspirations, sales projections, staff considerations, products and services, unique selling points, markets served, new markets of interest, opportunities, challenges, etc.

2. Research and Development

Once armed with all this company information, the consultant carries out extensive desk research to analyse the industry sector, and to help identify potential domestic and export opportunities. The consultant also spends time designing a client-specific presentation to help facilitate the workshop, to encourage open discussions from all attendees.

3. Workshop Facilitation and Delivery

Held in a meeting room away from the client’s offices (to minimise distractions), with owners/directors/senior managers in attendance, the workshop is scheduled for a full day. It is delivered to a pre-agreed itinerary, that often includes the following: the client company – where we are today and where we want to be in a few years; key facts, trends and opportunities for the industry sector/segments domestically and in key global markets; what is a strategy and the four key growth strategies; market positioning; customer profiles; product range; financial objectives and targets; staffing requirements; company SWOT analysis; mission and vision; the routes to market; and the action plan.

4. Strategy Overview and Action Plan

The day after the workshop, the client receives a copy of the full presentation and the one page action plan with notes, highlighting the few vital actions to grow the business as discussed and agreed at the workshop. This stage can also include a follow-up MT call to answer any further queries.

The outcome for any client is to have clarity moving forward. By management and staff participating in the workshop, group consensus and ‘buy-in’ is reached within the team. The action plan supplied is in a format that can be updated regularly, to help monitor progress towards agreed targets.