You might not think it, but you’re more likely to make bigger profits selling to an emerging market! There are several reasons why that is so. For instance, the domestic market might be somewhat saturated with providers. Or there could be less demand for the products and services you wish to offer here.
Another reason why it makes sense to sell to emerging markets is trade. Take Iran, for example. A few days ago, their decades-old trade sanctions got lifted. They are in desperate need of infrastructure improvements. The people there also want access to the latest technology such as computers, TVs and mobiles.
Of course, I’m not saying that you should only consider selling to Iran. There are many emerging markets in the world you could shortlist. So, how do you get started? Today’s handy guide will show you how:
Set up a company
Before you can start making lots of money, you need to establish your business first. This means getting incorporated and making your company official. Your foreign trading partners and clients will only deal with official companies. So, if you wanted to remain a sole trader, forget about it!
The good news is that it’s not hard or takes a long time to set up a new company. Did you know a company formation provider can do all the hard work for you? All you need to do is provide your business name and they’ll make it official for you.
An alternative is to ask your accountant to register your company for you. Some may charge you a lot of money to do that, so check first. Usually, the first option I mentioned is more cost-effective.
Next, you will need to safeguard your new business by getting the right insurance cover. Sure, having limited liability means you won’t lose your house if something goes wrong. But, you still need to have the extra cover to keep your business operational during tough times.
The cover you need will depend on what you wish to sell. Some items may need specialist insurance, such as with dangerous goods. There are standard insurance products you should get regardless. I’m talking about public and employee liability cover.
Be sure to do plenty of research and get several insurance quotes. That way, you can make an informed decision and get the best value for money.
Find out what the market needs
Just because something sells well here doesn’t mean it’ll be as successful elsewhere! Research is the order of the day when it comes to selling to an emerging market.
Let’s say that your company will specialise in providing rail infrastructure. You may sell tracks and trains, and work with third parties to build them. Some countries such as India are crying out for rail infrastructure modernisation. Other countries might have no need for a newer railway.
You could pitch your products to the Indian rail market and help them to upgrade their rolling stock. But, what happens if you specialise in something else, like heating products? Selling heaters to a country like India isn’t always the best of idea, given the warmer weather!
It’s crucial to establish the types of products emerging markets have a need for. That way, you won’t waste your time or anyone else’s trying to sell unwanted items.
Cater to their local market, not yours
One mistake that some firms do is to market their products and services as if pitching to a local audience. What you need to do is ensure your sales pitch tackles the needs of their local market – not yours!
Let’s go back to the Indian railway example. You might sell rolling stock to your local market and talk about quicker travel times. In India, there is a huge problem with overcrowding. People literally hang off trains during rush hour.
Your pitch to such a market could say that your rolling stock offers two levels of seating per carriage. That way, you can increase the amount of passengers carried without lengthening the trains.
Analyse the likelihood of products and services getting bought
Last, but not least, you need to work out how likely people in a foreign country will buy from you.
One way to do that is by using technology. The Internet is awash with data on all kinds of topics. You can usually get the details you need to report on your chosen subject.
If not, you could always hire a company to carry out some market research on your behalf. It’s important to study the market before pitching to buyers.