Expanding into overseas markets can offer exciting growth prospects. But marketing and selling overseas is a demanding undertaking.
1. Plan your strategy
Base your decisions on the best possible information
- Investigate customers and their requirements, and what your competition is offering.
- Find out what regulations you need to comply with.
Ensure that you understand the practical implications of trading overseas
- Consider how you will organise transport and other logistics, and whether you will use a freight forwarder to handle this for you.
- Assess the impact of different payment methods and terms on your cash flow, and the risk of non-payment.
- As our relationship with Europe evolves, it’s important to keep a close eye on what that might mean for trading with our nearest neighbours. To get the latest Brexit updates and find out how we could help you prepare for any changes, visit our Brexit hub
Set clear objectives
- Include targets that allow you to benchmark your progress. For example, sales volume or number of new customers.
Plan how to achieve your objectives
- Decide what sales channels you will use to distribute your products or services.
- Plan what you will do to promote and sell your products or services.
Involve overseas business partners
- If you work with agents, distributors, joint-venture partners or licensees, it’s important to get them involved in forming your strategy and objectives. They will have a deeper knowledge of the local market.
- Make sure that they understand your strategy and how you want to achieve it.
2. Your sales channels
Consider selling direct
- You may be able to sell directly from the UK, through your website.
- You could establish a local office to deal with sales, marketing, distribution and customer service in your target market. This will require significant up-front investment.
- Selling direct gives you control all aspects of your sales and marketing. You will need in-depth market knowledge and local business contacts, and may face language and cultural barriers.
Consider using a distributor
- A distributor will usually buy from you and then be responsible for selling your product to their customers.
- Using a distributor can provide the fastest route into your new market. However, you lose direct control of your sales, marketing and customer service.
- Try to find a distributor that has experience of selling your type of product, an established customer base and a good reputation.
Consider using an agent
- An agent will act as your business’s representative in the target market, selling and handling customer service on your behalf.
- Using an agent is usually the lowest-cost route into a new market. You generally only pay commission on sales the agent makes.
- You will usually have to invest in marketing support for the agent.
Consider a joint venture or licensing arrangement
- Creating a joint venture or licensing partnership will allow a local business to market and sell your product or service in the target market. An arrangement like this can include allowing your partner to manufacture your product locally.
- You share the risk with your partner and have some degree of control over how your interests are served in your target market.
- You will have to spend significant amounts of time choosing the right partner and reaching a detailed agreement to protect your interests.
3. Manage relationships
Make sure you have clear agreements with any business partners
- Agree what you want them to do. For example, you might want them to provide an agreed standard of customer service, as well as simply selling your products.
- Agree any restrictions. For example, if they are limited to selling within a particular territory, or must promote your product in a way you specify.
- Agree their rights. For example, as part of an exclusive distribution agreement.
- Agree how long the agreement will last and how it can be terminated, including any compensation for termination.
Take legal advice on the key issues
- Key issues can include your potential liability if things go wrong, and ownership of intellectual property (such as brand names). You can find out more about protecting your IP both at home and overseas here.
- Terminating a relationship can be problematic. For example, within the EU a self-employed agent is likely to be entitled to significant compensation.
- With potential changes in the light of Brexit, it is important to seek advice on the legal implications for trading with the EU.
- An experienced lawyer will know what needs to be addressed.
- Draw up a written contract to protect both your interests.
Build the relationship
- Keep a regular dialogue with your overseas partners. Even if it’s just a monthly call to find out about trading performance, it will help you to keep in touch with market developments.
- It’s a good idea to regularly ask about current market conditions, competitor activity and any feedback from customers and potential customers.
- Check whether your business partner has any questions for you.
- Regularly monitor their performance against your benchmarks. Look for the causes of any problems, and for opportunities to further grow sales together.
4. Promote and sell
Make sure you understand the local market
- Your marketing and promotion must reflect the preferences, buying habits and cultural influences of your customers in each market you sell to.
- Local product requirements may be very different.
- Bear in mind that business behaviour may be different overseas. For example, business people in France are often more formal than in the UK.
- You can find out more about the ins and outs of doing business in key markets around the world, with our International Business Guides.
Decide how you can promote effectively
- Research the most effective options for reaching your target customers. Consider options such as joining a trade mission or attending an overseas exhibition.
- Tailor your marketing message to suit the local market. Local customers may see your product quite differently from how it is perceived in the UK.
- Think about how you will build your image. Overseas customers might see you as exotic - or untrustworthy.
- Make sure you comply with any local laws. For example, prohibiting advertising to minors.
Overcome any language barrier
- If the local language isn’t English, make sure you have someone who can speak the language fluently.
- Even where customers can speak English, they appreciate it if you make an effort. Try to learn at least a few key phrases.
- Take care to ensure that any promotional literature you produce is professionally translated to avoid any embarrassing mistakes. If you have local agents, distributors or licensees, involve them closely when preparing marketing materials.
Keep up to date with market trends
5. Customer service
Make sure you have a robust system for order fulfilment
- Make it easy for customers to order. For example, through your local agent or your website.
- Set goals for order turnaround based on customer requirements.
- Organise effective logistics.
- Consider ways to reduce lead times: for example, by warehousing stock locally. Monitor stock levels and anticipate demand.
- Depending on the outcome of the Brexit negotiations you may need to be prepared for delays in shipping and receiving goods and raw materials.
Offer good after-sales service
- Make sure that customers can speak with somebody who has authority to make things happen when problems occur. Ideally, this should be in the local market.
- Plan in advance how you will deal with delayed or incorrect shipments. Bear in mind that returns and replacement shipments may involve significant costs and delays.
Build customer loyalty
- If you sell through intermediaries, think about whether you need to have direct contact with the ultimate customers as well.
- Regular visits can be a key part of building relationships, as well as helping you assess local market conditions.
6. Getting help
Use the Department for International Trade’s resources
- The Department for International Trade (DIT) offers a variety of services for exporters including a detailed export capability assessment and support programme.
- Find your local regional office.
Check what help other business support organisations can provide
- The British Chambers of Commerce offers a range of export services, support and events.
- Your local chamber of commerce may run an export club or offer training events to help you market and sell overseas more effectively.
- Your trade association may offer tailored export market reports and organise trade missions.
- Some local authorities offer financial support to businesses in their area which want to start exporting.