EXPORT MARKETING
EXPORT MARKETING
Export Market Feasibility
Before deciding to expand into new export markets your first step is to prepare a feasibility study. Questions you should ask yourself include “do I have the capacity to manufacture or supply to international markets?”; “what markets are available and who are my competitors in these markets?”; “what are the specific regulatory requirements of each market?”; “can I get my product to market on time and sell it at a profit?”; and “does my business have the financial capacity to expand into international markets?”. Your export market feasibility report should address:
- The market opportunity
- The size of the market
- Your distribution channels and sales strategies in the market
- Special requirements including customs, warehousing, packaging/labeling
- Cost of freight and insurance
- The reaction of local competitors
- Likely selling price and margin to your business
- Banking and international financial arrangements
Why Prepare an Export Plan?
Your export plan is an important reality check. Good quality, accurate information will help you make better business decisions. Decisions around your capability and capacity to export and the potential risks and rewards of the venture. Once you have determined exporting is feasible, the next step is to prepare an international market development plan. For each of your target markets, this analysis will help you understand the likely benefits, potential risks and the mechanics of the exporting process. Your plan will address issues like competitor activity, cultural differences and local customs. You will need to evaluate market entry options including market visits, trade fair attendance, developing in-market networks, promotional campaigns, channels to market and local distribution. Your plan should estimate the resources you will require to service your international customers. You will need to understand issues around shipping, insurance, banking and international financial arrangements.
When you enter into discussions with banks and trade finance companies, they will ask for your business plan. Your business plan will need to show you have validated your market and understand factors including:
When you enter into discussions with banks and trade finance companies, they will ask for your business plan. Your business plan will need to show you have validated your market and understand factors including:
- Barriers to market entry, like tariffs, duties and local customs requirements
- The local regime, including any legal issues relating to your product or service
- Channels to market
- Appointment of local agents
- Distribution agreements
- Labeling and packaging
- The mechanics of sea freight and air cargo
- Freight and customs documents
- Banking and international financial arrangements
- Insurance of international debt
- Foreign exchange risk management
Export Marketing Budgets
We are experienced in helping firms model the costs required to implement their export marketing strategies. Typically export budgets include a schedule of costs for undertaking market visits and preparing marketing collateral such as promotional materials or translating websites into local languages. Your budget may include the costs of attending, or exhibiting at, trade fairs, appointing in-market representatives, or local legal advice for drafting IP protection or distribution agreements. When you apply for trade finance or export insurance, you will need to disclose the full cost of producing, shipping and selling your product or service overseas, as well as your sales forecasts and models of your trade cycle.
International Trade Finance
For a list of registered banks in New Zealand who provide international trade finance, visit The Reserve Bank website. For help preparing documentation for banks and trade finance suppliers, contact us.
New Zealand Export Credit Office
The New Zealand Export Credit Office (NZECO) provides financial guarantee and trade credit insurance products for New Zealand exporters, banks and insurers. Their products help exporters and their banks manage risk and capitalise on trade opportunities around the globe by enabling them to mitigate credit risk, secure export sales and access trade finance. As well as working directly with exporters, they work closely with commercial financiers in New Zealand and offshore to support and improve the competitiveness of New Zealand exporters. NZECO is currently located in the Treasury and obligations to third parties are guaranteed by the New Zealand government.
