Exporting is considered the act of selling products/services to another country or region. When companies go beyond their natural market, the complexity of the sales process increases, as well as the risk associated with the particularities of developing business with foreign markets. However, why do companies invest on exports?
1 – Sales increase
The home market may be saturated and the company cannot increase its market share. Exporting could be a way to increase company’s sales.
2 – Increase profit
Not always, sales increase is translated into profits increase. However, even with tighter margins, profits can be increased by selling in larger markets and, consequently, with higher volume of orders.
3 – Maximize production capacity and economies of scale
By increasing the sales volume and diversifying the customer portfolio through exports, it will be possible to develop better production planning, contributing to an increase in productivity and the creation of economies of scale.
4 – Reduce dependency through market diversification
In some cases, companies activity relies on a reduced number of customers/markets. Exporting and, consequently, diversifying markets makes it possible to reduce risks associated with a country’s business ecosystem and the financial health of its customers.
5 – Manage seasonal flows
Markets don’t live at the same pace! The weather, festive seasons, business environment, among other factors, influence the normal functioning of business dynamics and lead to periods of higher and lower demand. Exports allow selling to other markets that are complementary and, in periods of seasonal decline, foreign markets can be the solution to sell products and services that are in lower demand in the domestic market.
6 – Customer relocation
Sometimes, companies internationalization is accelerated by their own customers. When a customer relocates production to another market, its supplier will tend to follow this movement, seeking to strengthen the long-term business relationship. Therefore, exporting is the fastest way to continue trading with the partner.
Are you looking to export to new markets?
Market Access has a team of 70 consultants specialized in business development in more than 60 markets. Our integrated offer starts at the stage of diagnosis and design of the internationalization strategy and follows the entire process until the objectives expected in foreign markets are achieved.