8 Steps To a Strong Export Strategy for SMEs

Oct. 2, 2015
Why every SME must build an export strategy--and 8 steps to get started.

Most small- and medium-sized enterprises (SMEs) consider themselves to be an exporter if they sell to a large international group that moves its factory to a foreign country, but continues to buy from the SME.

Sorry to be blunt, but that is not exporting or an export strategy -- that's called going with the flow!

Is this semantics? No, it isn’t!

Direct export is a crucial part of the SME business development and, unfortunately, many SMEs are hesitant to take even small steps to do it.

German SMEs, for example, have a questionable advantage over many small-country SMEs. Germany is full of large international companies who buy parts from German SMEs. These German conglomerates have production plants located everywhere in the world -- and these plants keep buying many years forward from the same SMEs. Sometimes they even help their SME suppliers establish foreign units.

Having advised larger SMEs, with 1000 employees or more, as well as much smaller ones, I know they generally struggle alone with the decision to go abroad.

The interesting, but sad, thing is, when the SME business is going well, they are not even open to the idea of export. Only when the business gets tough at home do they start considering an export strategy. This makes no sense.

Instead of whining about the detrimental effects of globalization on small business, SME should get in the game.

While big business is anticipating free trade agreements with various countries and regions around the world, most SMEs are sitting on the sidelines!

Instead of whining about the detrimental effects of globalization on small business, SME should get in the game.

Here are some basic steps for successfully managing the first steps toward establishing an export strategy:

  1. Find out in which countries your products could have the largest potential: Where do you have potential and why?
  2. Search the internet to look for potential business partners in the countries you've identified.
  3. Asses the market potential for your products and service in those countries. Conduct specific market research to obtain concrete, accessible market potential.
  4. Prepare international-style marketing and product documentation. The importance of this step is very often underestimated and, consequently, many SME are ill prepared for it.
  5. Contact potential distributors--today they are pretty easy to find--and sell! Selling is your job!
  6. Start identifying customers in the respective country.
  7. Feed the leads--and the orders--to newly engaged distributors.
  8. Repeat steps 5 to 7 as long as it takes to get the business up and running.

Naturally, there is much more to establishing a successful export business. The last steps are where the SME owner usually drops the ball, because they require committing skills and resources. I acknowledge that that the list looks easy, but in reality it is a lot of work.

For parts of the work you should consider hiring a hungry consultant. Not a consultant who produces presentations; you need one who is ready, willing and able to open doors wide open!

Follow these steps, and soon you'll be enjoying the many benefits that exporting has to offer an SME, including the following:

  1. By diversifying, the market risks are spread across many baskets –- even in a globalized world.
  2. An exporting SME faces many more operations and product challenges -- and thus learns much more -- than those that limit themselves to the home market.
  3. You expand your supply chain opportunities.
  4. You are exposed to many more business strategies and ideas.
  5. Exporting makes your business stronger!
About the Author

R. Paul Vuolle | CEO

R. Paul Vuolle, CEO of Bellevue SME Advisors GmbH in Switzerland and Germany, works actively with small and medium (SME) size manufacturing companies in Europe in SCM/Outsourcing, logistics, turnaround and restructuring, market expansion, as well as succession planning and financing. He also frequently supports technology start- ups in building up their business. He is the author of Lead Now, Manage Later: The Straight Shooter's Guide to Business Success.

Paul has over 20 years operational industry experience in engineering, electronics, industrial automation, building automation, investment goods like electrical drives, automatic test & measurement systems, HV Transformer production systems. During his career he has worked in manufacturing industries in supply chain management, outsourcing, logistics, production, R&D and successfully selling to international large key accounts. Paul has also run a sizeable amount of M&A transactions in numerous countries around the world.

He has built up his experience working in various leadership positions and functions in large corporations, such as ABB, and having executive positions in medium-size family companies and as a technology entrepreneur.

Paul is MSc. E.E. from Swiss Federal Institute of Technology in Zürich as well as BSc.E.E. from Helsinki Institute of Technology.

Paul is a long time member of IEEE and of its Industrial Applications Society.

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!