It is believed that exporting goods abroad helps in the growth of a small business and makes it more competitive. But how can a small business enter the international arena? Given the various things that a company needs to do to ship their products abroad, expanding can often be termed as a daunting process. However, that small business which export successfully can expect to record an increase in their revenue and profitability by expanding their market. There are some important things that should be considered to ensure the safe export to goods. While researching about the market, buying a marine cargo insurance, understanding risks, etc.; are some of the common things which everyone knows, here is a complete guide to help you –
Before initiating the export, make sure you’ve complete knowledge of the following –
- Conduct a proper research to find out who all are exporting to countries where you want to sell your products as well as who your local competitors would be in the new market
- Do a proper investigation to find out whether the demand for your product exists abroad or not
- Ensure your company has sufficient financial resources for developing the new market and hiring new human resource to satisfy an increase in your product demand
- Have a clear idea of the standard practices prevailing in the countries you are intending to export
Understand the risks involved
Exporting products also entail risks, including financial, product and operational risks. By doing some research about the standard practices of the countries where you want to export and then making necessary precautions, you will be able to ensure a hassle-free exporting of goods.
Here are some key issues which you should consider –
- Your profit can be affected by the fluctuations in the currency rates.
- It is necessary to ensure that your products are compliant with the global quality norms. So, carefully check your product specifications against the regulations and standards of the country where you want to export.
- Be cognizant about product quality. In some cases, companies are also required to transfer their manufacturing process overseas to comply with the country’s regulations. In case if you also require doing so, it would be good if you stay close to the production process so that it doesn’t hamper your standards.
- To export machine tools, electronic equipment, computers, and related components, it is necessary to have a valid license.
- Make sure you have a marine cargo insurance policy. Although there is no legal obligation to do so, it is in your interest to carefully insure your goods for any loss or damage in transit by rail, road, or air. The policy also covers goods travelling within India by any mode of transport. You can go for marine hull insurance, which is the part of a marine insurance policy in case you are using your ships for business. The policy will insure your ships and boats for all losses or damages. Then there are marine insurance covers available for specific transit, i.e., specific start and end destination.
The international business comes with its own share of risks. The importing or exporting of goods and services can expose you to numerous risks should your shipment is damaged or lost. Therefore, it is indispensable to buy a marine cargo insurance policy that offers the best possible protection to your cargo. Catering to divergent needs of different businesses, the marine cargo insurance is comprehensive as it offers coverage from the time the consignment leaves the seller’s warehouse till the time it reaches the buyer’s place.
As per your trade requirement, you can buy additional covers to expand your marine cargo insurance policy. Some of the extra coverage available with the policy are-
- Loading & Unloading
- Custom Duty
- Debris Removal
Shipping and Logistics
It is imperative to set a cost-effective and sound process to facilitate hassle-free movement of goods.
Marketing or Advertising
It is essential to make changes in your current marketing strategy to let people know about your company’s new markets:
- Re-design your relevant packaging, advertising, product literature and other point-of-sale material
- Translate your product literature into different foreign and local languages
- Revamp your communication strategy as per the country you are exporting to
A product that may be reaching obsolescence in this market may still enjoy demands in other regions. So, when you export such products or services, it will also extend your product’s life cycle. Moreover, when your business is active in more than one region, you feel, the less impact of region-specific issues that can affect your trade severely. For instance, if you operate in three different countries and the government raises the tax in one region, the impact will be less than what you would have to face when a business is restricted only to one region. Moreover, globally, you will have better business opportunities to explore. As you are exploring importing or exporting opportunities, you should go with an open marine cargo insurance policy which will cover all the marine sending in a one-year period.
So, diligently follow all the above steps and turn your small business into a flourishing one.