Market readiness means that a product and the company behind it are ready to enter a foreign market. This includes a variety of operational and strategic factors.
What exporter does not dream of being the next global success story? You have a great product, the world deserves to see (and own) it! So off you go on your international expansion journey…
If you use your government’s support channels, you will probably end up talking to someone like my former self. I was a Trade Commissioner for the Government of Canada for a few years, focusing on consumer goods and e-commerce. (Canada has the Trade Commissioner Service; the US has the US Commercial Service; Australia has AusTrade, to name but a few.)
I worked with a wide variety of clients – fashion, baby items, pet products, sporting goods, high-end cosmetics, fast-moving consumer goods (FMCG), also some tech solutions – and I found that many had high aspirations but limited knowledge. Occasionally, expectations were downright unrealistic. I have to tell you, in most cases it didn’t go well because clients simply were not yet ready to tackle foreign markets. And let’s be clear: Germany is a very difficult market.
I felt, and still feel, that there are two questions to consider: First of all, CAN you try and enter a specific market? The answer is often yes. Hey, why not, as long as your product is not illegal in the market? The second question may be trickier: SHOULD you try and enter this specific market?
What are some of the other questions you may want to ask yourself?
Is Your Product Market-Ready?
A product or brand may work very well in one market, but not at all in another. Why is that?
Most people purchase a solution. So what problem does your product solve? Is it a relevant problem for the market?
For instance, Germany doesn’t get all that cold in the winter. So we don’t really need fur hats to keep our ears from freezing off, a simple beanie will do.
(Some people may want to purchase a fur hat for fashion reasons, but that’s a completely different story. If you are in the business, be aware that fur in general is a very difficult product in Germany. Certain retailers even have a strict no-fur policy.)
Is your product unique or special? Is it innovative? Does it stand out? Does your brand have a story to tell? No? Then how are you going to entice consumers to buy your product rather than that of an established competitor?
There are also certain consumer preferences that vary from market to market. For instance, e-commerce surveys across the EU have confirmed strong variations with regard to payment and delivery options. These things are part of your product and will affect the customer experience.
Is Your Company Market-Ready?
The best product will fail if the entity behind it is not ready for the market.
You will need a strategy. A strong strategy. This is especially important if you are a young company with little or no prior experience in international sales and exports.
Building a strategy requires a lot of research. Why have you chosen a particular market? How well do you know your target market? Have you visited the country? Do you speak the local language? Do you have local industry contacts? Are you familiar with the local industry environment and with your competition? And of course, can you handle the administrative and financial burden imposed by regulation?
Walk, Don’t Run
Exporting is a great way to broaden your customer base and grow your business. It can also be a great way to ruin your business and drive yourself crazy. I am discussing some of the many pitfalls along the way in these posts: Market Size; Language; Product; Pricing; Local Preferences; Marketing; Competitors; Regulation; Importing Goods; Business Culture. Meanwhile, do your research, build your strategy and work towards your goal!