Yorkshire businesses embrace the challenge of overseas expansion

EXPERIENCED exporters and global business advisers have shared valuable first hand international trade experience and knowledge with other would-be exporters from the region at the latest international event hosted by Grant Thornton.

Catherine Reid, Grant Thornton director and head of international business, said: “It’s really encouraging to see so much appetite for overseas expansion from firms here in Yorkshire, which have a superb track record for overseas trade.  Businesses are united behind the idea that you need to be ‘in it to win it’ when it comes to international trade, and now is the time to start developing a strategy for overseas expansion, if it is the right course of action for your business.”

The event was led by three successful Yorkshire exporting firms who discussed their successes and learning in targeting new markets and growing revenues from overseas sales.  Comprising James Stones, commercial director of Barnsley-based turbocharger spare parts manufacturer, Melett; Richard Morello, corporate development director at Hull polymer technology company, Fenner; and Mark Roberts, chief executive of CSC in Leeds, which provides consultancy and outsourcing to blue chip clients; along with experienced international lawyer, Iain Bowler of DLA Piper, who offered an insight into the legal issues around overseas trading. The event was attended by dozens of Yorkshire business leaders and chaired by Victoria Tomlinson of Northern Lights PR.

Strategy and specialism
The huge potential of overseas markets is recognised as the key driver for initial investigation of export strategies. Global export success offers such a massive prize to successful internationally trading businesses that it is vital that Yorkshire firms get on the front foot and adopt a proactive, positive and determined approach.

There was a shared emphasis on the importance of starting out with a clearly defined overseas business plan and a strategic commitment to trading internationally. To achieve success overseas, businesses need to take a meaningful step into the market, and they should expect to invest time and resources to evaluate opportunities. Think about where your customers need you to be and where they could benefit from your presence.

The experienced exporters all agreed that committing to a market push was a key ingredient to success in new markets, and the panel all shared examples of their strategic approach to planning overseas expansion.

Businesses should set out objectives, targets and evaluation milestones when agreeing strategy and budgets. One size does not fit all – a bespoke plan must be devised to meet the particular needs of the business.  Regular evaluation to drive progress, and investment of senior time and attention to new markets, can be the difference between success and failure.  Have a plan and measure your success against this, commit to achieving the plan.

There are numerous routes to market and selecting the right one for your business will be a crucial decision and will also depend on the territory you are targeting.  Whether you choose to set up a subsidiary, make an acquisition, export via agents and distributors, establish a joint venture or go direct to market, will have implications that vary from country to country. Take advice from international experts to determine which is the most appropriate for your business.

Specialising in niche markets can unlock trade overseas much faster than targeting wide markets with general products and services.  Several of the seasoned overseas trading firms at the event cited a strong specialised offering as one of the key advantages they had when targeting a new territory.

“It makes sense to differentiate your services as much as possible, and identifying a niche can be key to early success,” said Reid. “If your product or service is distinctive enough to be a market leader locally, then its USP can potentially be replicated globally, given the right advice, strategy, planning research and local understanding.  Becoming a market leader globally by having an internationally recognised brand is the goal.”

First hand experience of the market
There is nothing more valuable to the early stages of export strategy than gaining first hand knowledge of a market, competitors and your target customers.  All the successful proven exporters on the panel agreed that there was no substitute to getting your feet on the ground and understanding the subtleties of trading with a new territory from a senior management viewpoint.

To fully commit you must invest time in being present in the country – one member of the panel explained that they had achieved success by sending a UK member of the team to be based in the investment country so he could develop valued and trusted relationships as well as ensuring quality control by having someone physically present.

Trading with different cultures presents new challenges for firms; cultural consideration and understanding of the local trading laws are crucial aspects of overseas strategy.  Making local friends and trusted contacts, and understanding the differences between trading in the target market and trading in the UK from the experiences of contacts already doing business there, was seen a hugely valuable.

“A number of common themes came through from our experienced exporters, particularly the need for thorough research, detailed planning and local insight before targeting a new territory.  Having a good and trusted management team is essential to success too,” said Reid.

“When considering overseas expansion, you will need to weigh up the risks and returns before taking the jump; you must consider what you don’t know too!  Having local knowledge really is key – make the most of resources such as UKTI and the network of British Consulates when trying to establish the lay of the land overseas as well as using advisers with international reach, such as Grant Thornton and DLA Piper, whose local representatives will add depth to your understanding.  Tread carefully, but with good research, a strategic plan and experienced advisers, you are in an ideal position to commit for success in your new market.”