Are you the owner of a small business? Are you planning on taking your products or services abroad? Things might be made a little easier for your as the Federation of Small Businesses (FSB) has vowed to help small business in their efforts to tap into the global market through export.
Recently, the FSB issued a press release in which they declared that they released a ‘factsheet’ to help small businesses planning to export abroad.
According to the FSB, export is very important to the UK economy. This is backed up by figures: at the moment, the trade deficit between the UK with the European Union is about £3.3 billion. Moreover, research conducted by the federation revealed that if the FSB members that are planning to widen their scope would actually do so, this deficit would increase by an additional £792 million. No wonder the FSB encourages companies to take their products and services abroad!
The national chairman of the FSB, John Allan [above] also made a statement concerning the helping hand the federation lends to companies with export plans.
Many small businesses have great potential when it comes to export and should not be overlooked when examining ways to increase the number of UK exporters, he says.
However, Allen also admitted that businesses do have a number of hurdles to take when they wish to export their products or services abroad. Therefore, he gives a number of great tips to help these companies along:
• Investigate the foreign country of choice: according to FSB, it is very important to know the demand and competition in the country you wish to expand into. Countries all have their own marketing and advertising rules as well: for a successful expansion, it is vital to know these rules. Another great tip from the FSB is the Passport to Export scheme conducted by UK Trade and Investment that helps businesses export abroad.
• Make plans about how you wish to sell abroad: you can use various methods to sell your products or services in other countries. This can be done via distributors, agents or joint ventures, but you can also opt for an office in the country itself. The FSB believes local help is always good, though. This can be found within the country or via UK companies that are already present on the foreign market.
• Do not avert your focus to another country until you completely understand the first: the FSB thinks it is a wise idea to understand the tax system, and especially the customs section of this system, before you start looking for other countries to export to. According to them, businesses can use the HMRC for documentation about this subject.
• Know who you are selling you products to: not all customers will have the same way of handling things, and their commercial deadlines might be different from UK standards as well, FSB says. Not every country, for example, has its weekends on Saturday and Sunday. You should also pay attention to payment; if they think potential customers will not pay, they can ask for a pre-payment of an Export Letter of Credit.
According to the FSB, some small companies need a little help with the financial side of their export plans as well. If this is the case, businesses can turn to UK Export Finance or any UK bank. However, the federation warns companies that before they loan money, they should consider additional costs, such as interest rates, and the term for which they want the loan.
In addition, the FSB says that the greater the risk for the bank, the higher the costs will be. This means companies must be able to prove to the bank that their product or service will reach the buyer on time and that the buyer in his term is a reliable business partner.
Are you looking to export? Did you know we provide a range of export sales & marketing services that can help you get your export activities off the ground or improve your current sales?