Services Export is a way to expand your business and reducing your dependence on the local market. Exporting exposes you to new ideas, management practices, marketing techniques, and ways of competing that you wouldn’t have experienced by staying at home. This improves your ability to compete in the domestic market as well.
A service export is an activity where there is a high degree of human involvement in the development and delivery of that activity. What is being provided is usually variability in quality.
By going overseas, you can become more efficient and increase your productivity. Exporting companies have better growth prospects, highly skilled, highly productive staff and tend to adapt technology and best practice techniques faster.
In a limited domestic market, you should think about going global. Global brands can be built from small local companies.
Why should your firm export
– You see an opportunity to increase your firm’s profitability
– You see an opportunity to enhance your firm’s competitive advantage
– You see opportunity emerging in foreign market
– You see an opportunity to exploit a unique competence that your firm
– Your competitors are exporting and you need stay competitive
– Demand for your services in the domestic market is saturated
The advantages to be gained from services exporting
– Broadening your market, currency ad client base
– Acquiring customers whose needs are a better match for your services
– Extending the life cycle of a service innovation
– Identifying partners for greater market diversification
– Keeping current clients who are expanding internationally
– Identifying partners for greater market diversification
Credibility in the foreign market
– Focus on building your firms credibility in a foreign market before promoting a special service.
– Have a competitive online presence. Making sure your website and other promotional materials project the image you desire.
– Build a strong base of contacts and ‘advocates’ willing to recommend your services.
– Being visible at international conferences or through presentations.
– Learning about the local culture
– Forming a partnership with a leading local firm to build credibility by association
– Appropriate licenses or certifications for professional staff
– Media coverage regarding your firms activities
– Strategic alliances with known industry leaders
– Building quality into your website and other promotional materials
Preparing for Export
In order to have business success internationally, a service needs to be in demand in overseas markets. It is also necessary to have commitments, resources, skills and information to support sustained exporting activities over the longer term.
The following are key signs your business is well on its way to being export ready:
- Significant management time and strong management commitment.
Developing an international business is no different to starting and building your domestic business; in fact, you can expect it to consume more management time than developing business at home. Exporting requires substantial commitment from management across the business, not just from the CEO or sales manager.
Strength in the domestic market.
Strength in the domestic market will make the cash flow and the working capital available in order to invest in developing your export markets.
- The resources to succeed.
Exporters find they need strong financial resources to expand overseas to cover the costs of travel and international marketing. Depending on your type of business, you will have to have the right people in place to run the export side of your business.
- Business and export planning.
Planning is necessary. Although most the companies in Antigua and Barbuda are Micro, Small, Medium Enterprises (MSME’s) companies don’t get around to business planning. Nevertheless it is critical that when you start, it is wise to consider putting these plans in place.
Does your Business Plan include an Export Strategy?
Developing a sound business plan for export
An export strategy is an essential component of your business plan.
Why should you have an export strategy?
Developing an export strategy helps you define your export aims and match your resources to those aims. Your export strategy will help you manage the market sectors you have identified as core business. Focusing your resources enables you to provide quality responses and service to your new export customers.
A well-developed export strategy will help in dealing with a range of service providers. It singles you out as a company that has well-developed, realistic goals and programs designed to achieve them.
Incorporating exports in your business plan
An export strategy must be integrated with your company’s overall business plan. Align export activities with daily operations and avoid any conflicts between your domestic and international activities.
Understand the areas where you have a strong competitive advantage. These areas may include your technology, your staff or business systems. Determine how best to use them to achieve your export goals. Also identify any weaknesses.
What are the key elements of an export strategy?
Bring your key export goals in focus in order to specifically aim your efforts. Your objectives should be clear, therefore the aims should include reducing fixed costs, accessing new technology, consolidating your international reputation or matching the performance of your domestic competitors who are already selling offshore.
.Who can help me?
An export strategy needs external review. Feedback from the Antigua and Barbuda Coalition of Services, the OECS Export Development Unit, Bankers, Financial advisers and Business consultants is valuable.
Pricing for services
- Specific costs associated with services – withholding tax, visas, flights, establishing a presence (local or virtual), accommodation, transport, pre-sales visits, freight, insurance, wages, translation, IP protection, currency/exchange rates.
- Business and cultural practices specific to the country Competition within the market – local and international companies.
- Ease of entering markets – local barriers, regulations, language etc.
- Maturity of your industry in the target market
- Unique service offering – ability to charge premium prices, perception you want to create about the service.
- Accounting for after sales costs.
- Meeting the costs of complying with applicable international standards.
- Opportunity costs – impact on domestic business, existing commitments, hiring of additional local staff.
Services export – Pricing
Developing your export markets can involve a range of costs that do not apply to domestic sales. These are general costs for exporting that are not specific to an individual contract. They could be considered your ‘fixed costs’ of exporting. Costs may include:
- Research into international markets
- Travel to overseas markets
- International communications
- Modifications to your service
- Product liability insurance or other insurances
- Standards Compliance
- Promotional costs
In Market Export Strategy
- Review your unique selling proposition, i.e. the distinct and appealing selling message that sets your service apart from its competitors. You may want to enhance it or add some specifics for this market. Feel free to discuss with the Antigua and Barbuda Coalition of Service Industries.
- Set down on paper exactly what you want to achieve from this visit – and if possible the individual meetings that you are scheduling.
- Develop a series of questions you want to ask at each type of meeting. Questions could include:
- What role your service would play in their business strategy
- How do they propose to market your service
- What resources would they commit to that
- How would they support after sales service
- Terms of payment
- Non-disclosure agreement before further discussions