Go Global. Emma Jones

      You want to know that time invested is time well spent. Small businesses have doubts over:

       how to cost-effectively find and communicate with customers abroad

       how to guarantee payment amidst currency fluctuations

       what the general cost of exporting is, when taking into account shipping and international travel.

      “Trepidation is founded on issues like geographical distance, language and cultural differences and occasionally market access barriers. It’s about having the confidence to visualise yourself doing business outside the UK.”

      – Lord Davies, former trade minister

      When it comes to matters of a practical nature, this category is an umbrella for a number of fears, including how to go about identifying overseas customers, tackling legislation and paperwork, language and cultural barriers, and where to go for help.

      41% of small businesses not trading internationally view the language barrier as the key inhibitor in taking their businesses overseas.

      – HSBC ‘Going International’ report

      There’s even the practicality of air travel, with the 2010 volcanic ash cloud having had such an impact that 16% of companies said they would reconsider overseas trade on account of the disruption it can be subject to.

      In December 2009, trading platform Alibaba.com questioned 3,600 entrepreneurs about sources of help and advice. The results revealed that 98% of respondents were unaware of initiatives to facilitate international trade.

      Evidence given to the National Audit Office by CBI emphasised the same issue:

      “A cry we often hear, particularly from small and medium-sized companies is that, ‘I just didn’t know that this was a service which was available to me’.”

      And in our own ‘Going Global’ survey carried out on Enterprise Nation, 79% of respondents said they did not know that public support for international trade promotion was available.

      This has been acknowledged by national government body UK Trade & Investment (UKTI), which, with an annual budget at its disposal of £268 million, is charged with attracting inward investment to the UK and boosting exports from the UK.

      Indeed, the agency’s own research:

      “indicates large numbers of existing exporters are not aware UKTI exists or are not convinced of the potential benefits from any external assistance, suggesting that many businesses have yet to access the services provided by UK Trade & Investment.”

      Actions are being taken to raise its profile, but UKTI will want to be sure their programmes are well-suited to the needs of modern day global traders who tend not to have employees, export departments or years of trading history, all of which currently form the eligibility criteria of key programmes such as Passport to Export.

      As a beginner’s guide, this book has been written to get you started on the right foot and with all the resources you need to prosper as you start to export to the world. If you have felt any of the fears raised above, don’t worry, as we will be busting the myths they depend on, and bringing down the barriers that may be holding you back from profitably taking your own business global.

      I see fear stopping people making sales. To them I’d like to say don’t let fear of the unknown or prejudice hold back your business – widen your market, spread your wings!

      – Mhairi Gordon, Impact Associates

      Bring down the barriers!

      It’s time to face the fear and fight back with reality; the reality of international trade according to the businesses profiled in this book and people who responded to our Go Global survey held in July 2010.

      Fears and realities

      Fear: To trade successfully overseas, I first have to trade in my own market for years.

      Reality: 28% of the companies surveyed and profiled started selling overseas within 12 months of trading and for 36% it was between one and two years. The companies were discovered via search engines or recommendation, promoted via local blogs and sites, and orders have grown ever since via word of mouth. For the majority of businesses (64%), this happened before their venture turned two years old.

      Fear: It will cost me a lot of money to become a global business.

      Reality: None of the companies profiled spent a penny, dime or yen on purposefully attracting their first overseas order. With business coming in from overseas customers, they are now investing in having sites translated or making customer visits, but even this can be done on a budget. These companies are all making the most of free or low-cost technology tools and social media to increase orders and customer satisfaction.

      Fear: I can’t make sales or service customers if I don’t have an office overseas.

      Reality: Of the businesses surveyed, 62% sell overseas via their own website and 25% sell via other commercial sites such as eBay, Alibaba and Etsy. When you have a presence on the web, you rarely need a physical presence in the country.

      Fear: I will need to employ lots of people to help take my business to the world.

      Reality: Of the 20 businesses profiled, 35% of them have one employee (the owner) and only 10% have more than 10 employees. Rather than employing staff, they are outsourcing and subcontracting the work, everything from manufacturing to identifying agents, and finding talent on sites such as Elance, oDesk and LinkedIn.com, from which they can effectively form international project teams. The way to grow, say our profiled businesses, is to focus on the bit you do best and outsource the rest.

      Fear: I won’t be able to understand export documentation.

      Reality: A significant 85% of survey respondents send their products overseas via the local Post Office and 11% use international courier companies, with the remainder making the most of local shipping arrangements. It is from these experts that you will learn all you need to know about documentation and customs procedures.

      Fear: I will have to speak the language of the countries to which I’m selling.

      Reality: It’s a nice touch to learn a few phrases and have parts of your site translated, but until you reach that point, take advice from our profiled success stories, and let Google Translate become your new best friend!

      Fear: I won’t get paid.

      Reality: Of the businesses surveyed, 65% use an online payment gateway such as PayPal to ensure payment is as easy and secure as possible for the customer, regardless of their country or currency. Having these systems in place increases efficiency and reduces the risk of customers holding back on payment.

      Fear: I won’t convert one international sale into lots more sales.

      Reality: Many of the profiled businesses speak of ‘accidentally’ getting into global trade by virtue of receiving international orders via their website or network. The experience of delivering that first order brings with it confidence in your abilities to service new markets and an appetite for more orders. This explains why 78% of survey respondents believe their international sales will increase over the next 12 months.

      Fear: I just don’t know where to start.

      Reality: Start right here!

      How government can help

      In researching Go Global, I have spoken to many businesses and delved deep into the topic. Based on this I believe there are a number of actions