Historically, setting up import/export businesses has always been lucrative, but did involve a bit of hassle. Now, it’s not as challenging as it used to be, and sticking to some well-trodden, tested paths can fetch you appreciable profits. But how do you know if your business is ready to enter the import/export market? Here’s a closer look at some aspects you need to keep an eye on to ensure you’re near-perfect in.
Set up a Website and Blog
Without a website or blog, it’s extremely challenging and even practically impossible to run a networked import/export business. Websites aren’t challenging themselves though. They can be sourced out to professionals or set up using platforms that offer click and drop builders, like Wix, Squarespace, or WordPress. All these platforms come with their share of pros and cons, so do some due diligence before choosing a platform suitable for your needs. This is essential to balance your communication flow and build a strong customer base to drive profits for your international business.
Make sure to register the business name with a reputable web host. Your domain name matters a lot, as it is one of the first things that your potential customers see when they peruse your webpage. All web-hosting services offer domain name registrations and affordable packages with easy-to-use site building capabilities. The creation of a blog in minutes with stunning designs, reliable hosting, and on-demand tech support can also be done to display your professionalism.
Pick a suitable product to import or export
Two things to keep in mind before choosing a product to import or export are:
- The Product should add some value to your customers
- The product should have a sizeable market
Make sure you meet both the criteria. That’s an ideal business model. Consult lawyers and Chartered Accountants to establish a virtual import/export business to keep it in the best legal and financial position possible.
Find the Right Market
Cultivating a knack for tracking trends or even spotting potential trends is essential to run a profitable Import/Export business. Research heavily to locate the best potential foreign market for your product or service. Having a good product at hand but without the right market to sell it to, greatly impacts a business. While this may sound obvious, the error a lot of failed import/export businesses make is precisely this. You don’t want to end up selling Kashmere shawls in Rajasthan’s desert region.
Establish communication with trade organizations, Chambers of Commerce, embassies, and trade consulates. They have a good sense of who’s doing what in the international marketplace. Remember to ensure that it is legal to establish trade with certain countries, and it does not violate your home country’s policies.
Source a Supplier
Once you have your product idea, the next step is to learn everything there is to know about it. Locate well-reputed manufacturers and have prolonged discussions with them to personally know more about your product. Suggest product improvements to turn a mediocre product into something slightly ahead of its time.
This goes without saying, but ensure high-quality products with reasonable costs when you source a supplier. Talk about the terms of delivery, and how much the products cost under different aspects. Remember, the cost is crucial to a business’s success, but the quality is equally important.
Price the Product
The business model for an import/export business has two critical elements within the international sales operation –
- Volume (number of units sold).
- Commission on that volume.
If you’ve followed this guide and performed the right market research, you should have a list of potential price points for different quantities of demand. The goal is to price the existing product in such a way that the price, including commission (markup on the product to customers), does not exceed what your customer is willing to pay. The more you sell, the more you make.
Consider your fixed costs and costs that vary per unit sold. Your main priority should be towards optimizing the contribution per unit (the difference between the price and costs that vary per unit). Every unit you sell will contribute towards covering your fixed cost, and with additional sales, you’ll start seeing profits.
Work on social media and networking platforms (blogs, Facebook, LinkedIn, Instagram, Twitter, etc.) by posting information about your product or service and asking specific questions about your audience’s needs. Word-of-mouth publicity through family and friends to advertise is highly in favor of a business.
Apart from working on your social media, and developing an online footprint, utilize services offered by tech giants like advertisement-, marketing-, and retargeting tools. These services ensure that you minimize your marketing costs by ensuring you advertise only to your target consumers based on a variety of factors, including their search history, preferences, and keywords they use. Don’t sleep on digital marketing. It is the key differentiator between a successful business tycoon to bankrupt businessmen.
Transport Your Products
The next step is to focus on logistics – transporting the product to your target market. Once the terms of the sale are solidified with your customers, hire a global freight forwarder to move your cargo. Their service saves the seller a lot of time, effort, and anxiety for very reasonable fees.
Based on the provided information, all shipping arrangements are taken care of. They handle documentation, determine necessary licenses, permits, quotas, tariffs, and restrictions (country regulations), which can practically be the most complicated aspects of importing/exporting for an inexperienced international trader. Different companies such as DHL, FedEx, among others have different specialties, at different tariffs, so make sure to thoroughly vet your freight provider before entrusting your cargo.
Provide Great Global Customer Service
Your relationship with overseas customers shouldn’t end after a sale is made. Think of after-sales follow-ups on the import/export business as part of the product offering. Thank your customers for doing business with you, and cater to all their needs.
Ask for constant feedback and act on them. Apart from the obvious benefits of future sales and increased popularity via word of mouth, reviews and testimonials offer you concrete social proof, driving more traffic to your website.
Coming up with a business idea is extremely easy. The real difficulty lies in executing the plan and materialising your dream business. Follow this guide if you’re new to the import/export business industry and you’re sorted.