Exporting for Success: Small Business Growth Opportunities

Winning trade overseas is a key way to kickstart growth and prosper in the marketplace for most companies around the world. Small businesses can also grow their revenue and profit who export successfully by expanding into new markets. However, expansion can often be a complex and time-consuming process as companies need to satisfy to ship their products abroad with various requirements.

Many small businesses don't have time to consider their export potential because they are so busy running their day-to-day operations. Companies generally think exporting is too complicated or burdensome, or they are not aware of incentives and export assistance offered by their governments. 

There are a lot of reasons why a small business should start exporting, including:

Exporting goods overseas can help increase overall sales and profits. You can even double the annual revenue compared to non-exporting companies.

It will be marginally less expensive to produce 1000 units than 500 units if your firm has excess production capacity. Therefore, your per-unit cost will come down when you expand your customer base with the new overseas markets.

The market share of the U.S. market might be easier to obtain and profits might well be higher as it is extremely competitive compared to many other countries. The fierce competition within the U.S. market could be because of either foreign or domestic competitors, or both. So, a business might decide to enter other markets in order to grow, to tackle this. A small business might also expand into overseas markets in response to its main domestic competitors doing it and stay competitive in the long run. The competitors may try to use overseas profits or lower production costs so that they can more aggressively compete domestically.

Majority of the global population is outside your own country. So, your customer base is outside your own country if you have a product or service to sell.

You will be able to increase profits as well as growth of your company with exporting. It can also act as catalyst for rapid growth.

Your business can spread the risks by expanding, the impact from local downturns or disasters get lessen with a wider geographical spread. 

A company could continue to generate a revenue or royalty stream from the product by exporting the product which may be nearing obsolescence in a market as it may still have demand in different parts of the world such as Africa. A company could also continue to generate a revenue by licensing its intellectual property to an overseas producer. For example, some Chinese mobile phone makers sold large quantities of outdated mobile phones to Africa and other underdeveloped regions over the past 10 years. These affordable phones have not only contributed to the success of these companies but also met the demands of their users.

You should be aware that we have two summers and two winters every year if you are a company that produces products related to the seasons such as diving gear or down jackets. A company could moderate seasonal fluctuations in its production cycle by selling seasonal products south of the equator during their off-seasons. This is an excellent benefit for both the company and its employees.

The need to appear large and established is one of the most challenge for small businesses which is allowed by e-commerce. E-commerce is not just the future of trade, it is now a pathway for exporting for many small businesses. You can successfully export worldwide without actually meeting the final customers several times using e-commerce.

You may have more advantage if your country is known for sound business practices, innovative goods and services, or high-quality customer services throughout the world. The stories, heritage, or reputation of your country can work as a real selling point when trading abroad.

You can better understand your competitors and will be exposed to new and different ways of doing things, new customer requirements, new technologies, etc. All of these will result in better products and services.

You will have the opportunity to learn about new cultures, to make friends with people from foreign countries, or to try unusual, often exotic, foods with exporting. It is not only fun, but also it brings the world closer together. Everyone can benefit by cutting costs, encouraging friendships, and making economies and companies more competitive and productive.

Small businesses should not miss out on the opportunities to trade abroad as global trade is becoming easier with the U.S.-Mexico-Canada Agreement (USMCA), African Continental Free Trade Area (AfCFTA) and Regional Comprehensive Economic Partnership (RCEP).

Export is supported by most governments. They are also offering assistance and incentives to exporters. For example, exporters in China have a number of favorable policies such as export tax rebates. The massive Belt and Road Initiative of China is also benefiting both domestic and foreign exporters.

Most economies are expected to have faster economic growth in future as the world is rolling out COVID-19 vaccines. The world economy is expected to grow year on year. It is now a good time to start exporting and benefit from emerging and developing economies growth.

Quality of products really affects the image of your business and your country as it matters to customers both in and outside your country. Therefore, make sure the products you are exporting not only meet the needs of customers and the relevant laws and regulations but also are of high quality. This is one of the most important keys behind the success of a small business.

A marketing strategy or product design that works in one country may not work in another as every market is different both economically and culturally when it comes to global trade. For example, you must be aware that most Brazilians do not like the kind of chili sauce popular in India when you want to export a type of Indian chili sauce to Brazil. You need to change the ingredients of chili sauce to create a taste that is like by most Brazilians to make a profit by selling this sauce to Brazil.

You can not not only acquire new foreign buyers but also retain them with the help of good customer services. Existing customers who are happy with your services and products can even bring you, new customers. Valuable feedback can be obtained in the process of providing customer services, which can be used to improve or better adapt your products and services.

It is hard to establish and get success in a new foreign market alone, especially when you are a small business with limited resources and expertise. It can be a big help if you can find and work with partners who are familiar with the local market. For example, you may consider forming a partnership with a multinational hotel chain if you are exporting products mainly used by hotels. This will help you to break into multiple export markets by taking the advantage of its network and reduce your effort in promotions.

Support and incentives are provided by most governments around the world to small business exporters, in order to boost the exports and economies of their countries. For example, the Department of Trade and Investment offer a number of programs to help with exporting goods including UKTI's Passport to Export Service and Gateway to Global Growth in the UK. The Small Business Administration (SBA) of federal government provides counseling, training, recommendations, and financing support to small businesses so that they can take advantage of export opportunities in the U.S. Companies in India can apply for a rebate, or refund of the value added tax (VAT) and consumption tax on eligible products for overseas markets. You should check out the available support offered by your governments if you are interested in getting into the export business as a small business owner.