Business owners talk about exporting
Ways to make exporting work for you
SMEs explain why they looked at international markets, the challenges they faced and how we helped them expand overseas.
Expanding your business overseas is a challenge, but one that offers rewards. If you’re considering taking this step, or want to develop the exporting aspect of the business, we’ve got some practical tips from businesses who have found success in international markets. So let’s meet them.
Meet the companies
Mark Smith is the founder and MD of Systems Power, located in Skelmersdale, Lancashire. It is now a 100% export-oriented company, selling high-voltage capacitors in the Middle East, Africa and Scandinavia.
Tanya Houston started Wildwood PR in 1994, on her own, from her back bedroom. Now, she runs PR campaigns for clients across 9 different countries.
World of Rides
David Robinson started World of Rides in his garage in County Durham in 1969. He’s been manufacturing and selling his amusements, rides and games ever since. Today, he exports go-karts, bumper cars, bumper boats and pedal-car rides to holiday parks and resorts in countries including Sweden, Italy and Spain.
Gemma Price founded Superfood Market out of a cupboard in her Ealing kitchen in 2012 after spotting a gap in the online market for ethical, healthy food products. Now based in Bradford, the company serves over 40 countries around the world, from 4 warehouses across Europe and the UK.
Superfood Market – an exporting success story
After forming in 2012, ecommerce site Superfood Market now sells health-food products in ore tha 40 countries.
Why start exporting?
For Mark, selling products overseas, in several territories, is not only about reaching a wide range of customers, it’s also about security. ‘This helps broaden our markets,’ he says, ‘and by avoiding going up and down based on just one home market or economy, we spread our risks.’
Tanya explains how it was her existing relationship with Barclays that led to her move: ‘A few years ago, our Barclays Business Manager identified how our business was growing and suggested this could be an opportunity to expand further,’ she says. ‘They helped us take our first steps internationally.’
About 40 years ago, David made the decision to move some of his manufacturing abroad due to general strikes, a shortage of good labour and strict manufacturing regulations back home.
Gemma's passion for her products inspired her to sell it overseas. 'I wanted to sell artisan domestic products abroad, where they were previously unavailable,' she says. And once word spread, expansion was easy – she started to receive emails from potential customers in new countries asking if she’d ship to them.
Where to begin
We began working with Mark to put an international strategy in place. ‘Straightaway, Barclays provided us with a Relationship Manager and they pulled in the expertise from other sections of the bank, as and when we required it,’ he says.
‘Understanding letters of credit, performance bonds, dealing with foreign banks and multi-currency accounts – Barclays helped clarify exactly what we needed and delivered everything seamlessly.’
‘We have always worked very closely with our Barclays Relationship Managers who, in turn, have introduced us to their International Managers, who have always been fantastic,’ says David.
‘They saw the potential and offered assistance before we even asked. They said: ‘Look, we can see you’re growing and we can help you grow even more.''
The challenges of exporting
‘I needed a bank with the expertise and capability to support the requirements of a company operating in a very specific sector,’ says Mark.
Last year, Systems Power started to look for new customers in the Gulf region. ‘They didn’t know us and we didn’t know them,’ says Mark. ‘We needed letters of credit and, in turn, they needed performance bank guarantees.’ We re-evaluated those performance guarantees by around 40%, which helped Mark unlock new business opportunities in the region.
‘There were some legal aspects of exporting we needed help with, and at first, even being paid in a different currency seemed complicated for us,’ says Tanya. ‘In 2010, Barclays introduced me to UK Trade & Investment, during one of their local seminars on export. Together, they helped us take our business to the next level.’
‘We had to find trustworthy long-term partners in each country to act on our behalf, but in their own language and using their own business methods,’ says David. ‘We had to make sure that the bank payments between countries could be done safely.
‘We also had to find reliable logistics companies to transport the goods safely and on time. These things can be a hard learning curve for any fledgling business. Having a UK bank with such a fully experienced International department makes a massive difference.’
Fluctuations in exchange rates can have a huge impact on Superfood Market's business. If Gemma doesn't stay on top of them, the company could make losses in certain countries unless its pricing is adapted accordingly in real time. 'I have a widget that I can use to just add the new rate in and it instantly changes all our prices across every marketplace we operate in,' says Gemma.
Working with us
‘We’ve always been very open with each other,’ says Mark. ‘Barclays knows where we are, and the trajectory we’re on. That's what allows them to support and recommend what’s best for us as a business. Barclays is very much part of our future. By providing that flexibility when we move into a new market, to quickly support any banking requirements – that’s how we grow, together.’
‘Of our client base, 30-40% is now based overseas, and with Barclays’ and Department of International Trade's help, we’ve been growing in new business for the past 3 years,’ says Tanya. ‘Our international experience means we can confidently encourage our clients to be ambitious and think internationally.’
‘Barclays was very helpful, explained how I could do things differently, as well as where to go for specialist advice and funding,’ says David. ‘As our output has grown in volume, it’s become a major part of our business to follow international exchange rates on a daily basis, in order to secure the best rates, and the bank also taught us how to make safe international bank transfers online.
‘We’ve gone through a great many growing pains together,’ he says.
‘Sure, we’ve had our ups and downs, with all the many years of recession we’ve been through. But any time we need help, we just pick up the telephone and get access to the best advice. I didn't have that when I started and it’s important to have someone to bounce ideas off.’
'Barclays really understands international ecommerce,' says Gemma. 'Often making great suggestions about how I can improve in certain areas.' She also makes regular use of our apps – regularly checking her balance on Barclays Mobile Banking and using the FX powered by Barclays app keep abreast of changes in exchange rates.
'The foreign-exchange app allows me to proactively manage our FX exposure,' she says. 'It's like having another member of our finance team constantly monitoring currency movements, letting us know when it's time to take action to update quotes and sale prices or where we can afford to be a little more competitive on our export sales.'
Tips for success
David: ‘Speak to your bank. Make sure they fully understand the different costs, currency fluctuations and timescales involved. Also, don’t assume that overseas customers will be as alert to any problems that may arise as they should be.
‘Always try to learn some basic language of each country as a mark of respect and to help ease any future misunderstandings. It’s also a good idea to attend as many international trade exhibitions as possible, to talk to as many overseas buyers and suppliers as possible.’
Mark: ‘Make sure you deal with an international bank. That perspective and expertise is invaluable. Also, I’d recommend anyone to take advice from the Chamber of Commerce and Department of International Trade.’
Tanya: ‘Start by looking at the people and businesses you work with. Leverage and invest in them and see what they have to offer you.
‘Don’t be afraid of change – welcome it. The world, technology, businesses are changing every day. Be flexible, adapt. Above all, listen to what the market wants and work on delivering that, setting achievable goals.
‘Manage your time and resources – with help from outside sources such as your bank if necessary – and focus on what’s going to make a real difference.’
Gemma: 'Be persistent and dedicated – your international order book will not come over night. Keep developing it and over time it will start to become an essential part of your core business.
'Don't be afraid. Of course the EU and English-speaking markets are easy wins, but Japan and Russia are currently our best performing markets. Dream big and don't be afraid to chase orders from further afield.
'Get help from experts. Speak to your bank, Chamber of Commerce and Department of International Trade. Find out everything they can do to support your business. Download their apps and play on their websites, you would be surprised just how many tools, guides and flow charts are already out there.'
Find out more about how we can help you expand internationally or call call us 0800 515 462 1. Lines open Monday to Friday, 8am – 7pm.
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