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So you want to be an exporter

A short, sharp injection of knowledge is perhaps better than none but if you are really serious about growing your exports and developing your own knowledge and skills, you need to invest some time.

Your country needs you. And now. Business owner, entrepreneur, idea generator, scientist … if your enterprise is up and running and you haven’t yet cast your eyes offshore, it’s time to get with the programme.

The fly-by-the-seat-of-your-pants export model doesn’t exist. If this is how you’ve built your business to date, you may have to bite the bullet and start studying Export 101.

A short, sharp injection of knowledge is perhaps better than none but if you are really serious about growing your exports and developing your own knowledge and skills, you need to invest some time.

A one- or two-day course can give you the basics, but you won’t develop the level of knowledge and skill required says Euan Purdie, NZTE director, performance improvement and knowledge.

“There’s no way of avoiding the reality that exporting success stories are built on the back of solid disciplines, market information and insight, persistence, and strong and enduring relationships. Rather than look at any information immersion as being a burden, think instead about the connections you might make and how these—and what you learn—might help fast-track your plans.”

Formal education is one contributor to success but nothing beats actually talking to people who have already done the hard yards in a particular country.

“You can learn an incredible amount from exporter’s war stories. What helped them deal with battles and eventually make inroads into new territories could be the type of information you need.”

While NZTE’s extensive portfolio of information provides a great initial reality check as to the preparedness of a venture to go offshore (plus the various touch points needed to put together the outline and elements of an exporting plan), Purdie suggests engaging with your nearest chapter of Export New Zealand to dust your tyres in.

ENZ offers a made-to-measure point of access to global and local exporting connections, exportingfocused forums and specialised export-focused advice and service. Plus, of course, war stories are on tap. It also has its own bona fide school: The New Zealand School of Export offers this country's only IATTO-accredited Diploma of International Trade.

As you move up the food chain, says Purdie, more resources and information can be put your way. In the first instance there is a plethora of good information available to plug the information gaps and define the issues at a theoretical level.

Nothing, however, will take away the need for doing the hard yards and pounding the pavement. It will just ensure that this pounding is not directionless and futile and will help you to have all your ducks in a row before putting resources into the endeavour.

—Euan Purdie

The main lesson Euan Purdie wants to impart is what he calls Rule One of Exporting.

“No matter how familiar looking a possible export market might seem, it will be different to what you are used to and are coming from. The fact that you may have run out of market opportunities in New Zealand doesn’t automatically mean that the leap to an Australia, or even a Pacific Island, is a foregone conclusion.”

Andrew White, NZTE's director of business and regional intelligence, says businesses need to be sure they know why they want to export. Just because a product is not for sale somewhere does not necessarily mean there is a gap to fill. It may be that the product or service you have to sell is not wanted by or appropriate for that market. A passing comment by a friend or family member that they can’t get Pavlova in Japan doesn’t necessarily mean there is a market for it there.

It is vital to have a strong foundation and well thought out business plan prior to exporting.

“Companies looking at exporting as the next step in their business development need to be prepared to fully commit and to understand that this is an expensive exercise. Businesses need to budget for everything that comes into play, including regular market visits, marketing collateral and, if appropriate to their sector, trade events. Exporting is not something to just dip your toes into every now and then.”

Strong people and financial capability, the ability to dedicate time and resource, and the willingness and ability to take a midto long-term perspective go with the exporting territory.

Here’s what you need to ask yourself, says White:

  • Is your business in a position to dedicate staff to researching international markets to determine whether your company and products have a point of difference?
  • Can staff travel overseas without impacting on your domestic business and invest time in developing and maintaining offshore relationships?
  • Will resources allow you to invest in IP strategies and protection?

Real world experience, he says, is invaluable. Here’s what he suggests:

  • Take time out to map the areas in which you need advice.
  • Brainstorm who you could talk to first. It could be other exporters in the immediate business community, through to people located offshore that you can connect with. Everyone may offer valuable advice, or be in a position to offer access to their own broader networks, and it is unlikely that a single person will hold all the answers.
  • Ask the right questions in order to get useful answers.
  • Think about the context of the advice you are getting—what experience is that advice based on and how recent is the information?
  • Consider getting a mentor.

While the so-called information age makes life easier for sleuthing, White adds a word of caution.

“Access to information is certainly better, but that does not remove the need to validate the information you are gathering or hearing. You’ll need to get to the market after doing the initial preparation to see things for yourself, understand the dynamics of that market, find out about price points, the competitive situation and regulatory framework and build relevant networks.

“Regular ‘weather checks’ in the market are necessary. Things you learned six months ago may not be valid now, and networks need to be maintained. Also the information age doesn't change the need to get cultural and language aspects of doing business right.”

Zomo’s Richard Duckworth agrees that IT has been more than helpful in bringing advantages to New Zealand businesses, provided some of the fundamentals are treated correctly.

“E-commerce has bought the world a whole lot closer. But it brings its own set of problems. The big challenges New Zealand exporters now face are in the details, and clear communication is what is going to address a lot of these. For instance when dealing with customs clearance and duty payable at the destination country, your customers don’t want any surprises after they have purchased online, so any work you can do at the front end to get calculations right will be really well received.”

Overall you've got to make your products and company accessible and findable if you're relying on cyberspace to open up doors and opportunities for you

Richard Duckworth

—Richard Duckworth

“You can do this by optimising your web presence for the market you are targeting. By this, I mean translation. So an Italian searching for innovative, premium marine products on Google.it in Italian, is not going to necessarily discover the likes of a ‘Taniwha Boat Accessories’ in their search, even though that company may produce great stuff. It seems obvious, but getting your website (and in fact all marketing collateral and sales presentations) translated accurately, and maintaining the tone in a way that is relevant to the various cultures in which you are operating is critical to success. So a Google Adwords campaign in Italian for our example above is going to pay dividends.”

BNZ’s Brett Walters says intercultural understanding is becoming more important.

“The trade opportunities in our region—especially with China and South-East Asia—are exciting but to succeed you have to interact with them on their terms. There is a hierarchal structure in interactions whereby your CEO relates to the head of their operation. Thereafter this is where the relationship lies so multiple face-to-face visits of all the people involved in building the relationship is expected. The companies that understand this are the ones who are succeeding.”

What in the world?

What is it that overseas markets want from us? Quite a bit, it would seem, and from a wide spectrum of sectors.

The value of New Zealand’s merchandise exports for the year ending December 2009 was NZ$39.7 billion, a drop of 7.7 percent over the previous year. New Zealand’s service exports, including tourism and consultancy, were estimated to be worth NZ$12.7 billion for the year ending December 2009.

In the year ended December 2009 the export value of New Zealand’s food and beverages was NZ$22 billion, representing just over half of New Zealand’s total merchandise exports.

Manufactured exports totalled NZ$18.9 billion, including organic chemicals, pharmaceutical products, plastic products, rubber products, leather, textiles, paper and paper-associated products, furniture, electrical equipment, marine equipment, agricultural and industrial machinery.

Primary product exports (including plants and flowers, grass and other seeds, wool, raw hides and skins, wood/pulp) totalled NZ$6.1 billion.

Industrial raw materials and metals exports totalled NZ$2 billion, including mineral fuels and oils, aluminium, iron/steel, other metals and all other raw materials.