I’ve been reading with interest some of the articles and research that have been coming out over the last few weeks with regard to exporting. Key articles have included the
Barriers to Export research piece, which was completed for NZTE. Also the NZ Institute has completed a number of discussion papers about creating a global New Zealand economy. The latest is titled
Developing Kiwi Global Champions: Growing successful New Zealand multinational companies. At 52 pages it’s not a quick read but it is thought provoking stuff.
The report highlights 4 challenges to getting more companies exporting;
- Financial Incentives – the NZ Institute argues that the returns from exporting aren’t perceived to be high enough.
- Capacity to Compete – they have a concern about whether we can successfully compete abroad.
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Low level of Aspiration – growing big successful exporting businesses is not perceived to be aspirational.
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Weak Capital Markets – Cost and access to capital an issue.
The key issue here for me is the second point, our capacity to compete. In the report they highlighted specific things we can do to address this. The recommendations all revolved around increasing your Competitive Strategy.
The key priorities in order increase your chance of export success are;
Commitment – successful companies commit to exporting. It’s not something they try for a while, and dip in and out of. They have a 10 year vision and focus on realising it.
Competitive Advantage – If you’re going to compete internationally you have to have a clear point of difference. You have to add real value compared to your competitors. Just because you have a successful financially viable business in New Zealand doesn’t mean you will succeed. Before you launch internationally do some research in the markets you’re interested in and make sure you have truly differentiated products and a clear competitive advantage.
Grow Internationally in Steps – First make sure you have a sound financial base in NZ before you launch internationally. The investments you make in international markets tend to be larger and risky, and not everything you try is going to work. Secondly grow organically; test the market first, once you’re sure of your competitiveness then scale up to handle larger markets. Don’t go for a big bang approach initially.
Put Experienced People on the Ground – Successful market entry requires a deep understanding of the local market and their dynamics. Initially desk research with occasional trips to market might be sufficient for initial market tests. However to get deep knowledge about customer demographics, customer tastes, market structure and the nature of the competitive environment, channels to market, and the regulatory environment you need to be there.
The Export Mindset
NZ Trade and Enterprise has been in the act of researching export success as well. Their
Barriers to Export report looked at the physiological barriers for businesses to begin exporting. Their contribution was that successful exporters had a state of mind that allowed them to do it and succeed. Those people had a level of confidence and optimism about the future that allowed them to face the risks involved and get on with it. They rather obviously noted that if you’re not confident and not prepared to take any risks then exporting is not for you. However they did have a number of suggestions on things you can do to increase your confidence and view of the future these were;
Success Stories – read about other peoples success exporting. If you don’t get NZTE’s Bright magazine its full of export stories and it’s free, just email
bright@nzte.govt.nz
Collaboration – network and find others in your sector that are interested in exporting and swap stories and ideas.
Training – there’s a bunch of free courses available, all designed to help you export or develop the skills you need to export. Go to
www.exported.co.nz for more info.
Take Small Steps – don’t risk the house. As per the NZ Institute article the most successful exports start by taking it one step at a time.
Get Professional Help – whether it’s someone that can help with your strategy, marketing or just a coach to help guide you, if your not 100% confident get someone in to assist.
Export Assistance
There are many different ways to get government assistance with your plans to start exporting. Here’s a list of places to start;
- Training – Getting started in exporting, sales, and market entry courses - www.exported.co.nz
- Design – to help you become more design led so you can improve your products - Go to Better by Design.
- R&D/Technology Development – to help you develop new products and technology capabilities - Go to www.frst.govt.nz
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Market Development – funds to help you enter new markets. - Go to NZTE for this and other useful information.