How to drive your exports to deliver profitable international sales and long term success
06 October 2021
Nicola Thomas, Director of the UK Food and Drink Exporters Association, talks through some of her tips for Food and Drink manufacturers reaching out to new export markets.
BDO’s latest Food & Drink report notes 83% of manufacturers in the sector have reviewed supply chains for threats in response to COVID-19. And 42% expect sales growth to come from territories outside the European Union, so foreign markets are very much on the agenda.
But trading outside of the UK is not without its challenges. The BDO report notes that managing international supply chains and the UK leaving the EU are among the top worries for Food and Drink manufacturers in the UK this year, cited by 42% and 39% of those surveyed.
Companies often fall into exports by responding to random enquiries or trade show leads without any real understanding of the market opportunities and challenges or the suitability of the enquiring company as a partner. As a result you can easily end up exporting to 10 or 20 markets on paper but shipping a few ad hoc orders a year to the first distributor or customer you connect with, this is unlikely to deliver sustainable sales or long-term success.
Now more than ever, especially in light of Brexit, COVID and the resultant global supply chain challenges, if you want to build long-term and profitable international sales and give yourself the best chance of success, now is the time to start driving your exports rather than continue to let them drive you.
So what does that mean in practical terms:
- Build your exports based on your internal capabilities and goals to determine where they fit into your overall strategy rather than treating them as a bolt-on to UK sales. Ask yourself a few questions – how far are you prepared to adapt your products and packaging, what financial and human resources do you have for your international expansion, how many markets can you realistically develop and manage at any one time? Just by answering those very simple questions you will have a much more realistic view of what you can and can’t achieve.
- Be less opportunistic and more strategic about the markets you focus on and the partners you select. Take time to research and identify the best fit countries, sales channels and distributors for your business.
- Be less focused on chasing orders in as many territories as possible and more intent on maximising all the available opportunities to build your brand, company awareness and sales in one or two countries at a time.
- At the same time, reduce your exposure to risk by building a more balanced portfolio of export markets. Spread your risk so you are not dependent on one market or region for your success. If you are only selling in one territory and consumer spending dives or your category stops growing, you will be very exposed.
- And finally, also think carefully about one-off activities like (virtual) trade missions, meet the buyers events and trade shows and where they fit into your overall export goals. Don’t be seduced by the fact the event might be free or subsidised and if you turn up without a specific objective,you then run the risk of being disappointed with the results.
Nicola Thomas is one of the experts who contributed to this year’s BDO Food & Drink report.
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