What are the minimum requirements for selling abroad?
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The series of videos dedicated to export for small and medium-sized enterprises continues, made by interviewing expert Alberto Scanziani.
The series is dedicated to illustrating how to successfully approach foreign markets while avoiding the typical pitfalls an SME encounters (here is the introduction to the series in episode 1).
Explained in this video are the minimum requirements on which to do a self-check to understand whether one is able to deal with foreign markets: corporate identity, one's web channels, the use of social media, and the study of markets become the ABC's of the exporting enterprise.
Here is the minute-long breakdown of these topics, if you are in a big hurry and can't watch the whole video (and what--don't you have 10 minutes to yourself in a day? Bad!):
-> 0:40 - How to curate corporate identity for export.
-> 2:28 - Concept of historical experience of the company.
-> 4:12 - Concept of apparent company size
-> 5:45 - Concept of market segmentation
-> 7:40 - Proper approach to distribution channel
-> 8:58 - SWOT analysis, Strengths, Weaknesses, Opportunities, Threats
Enjoy your viewing!
Video transcript:
Hello everyone, here we are with the second pill dedicated to export marketing, once again with Alberto Scanziani. Hello Alberto.
Hello Max, thank you.
Often in a company, the entrepreneur or management asks what the minimum conditions are to enter international markets. What would your answer be? What should the company look at within itself to understand if it's ready to export?
The first important factor, in my opinion, is identity. Approaching international markets requires a very different effort than what is needed for the domestic market, so you need to carefully manage your identity. Foreign counterparts, before looking at the product you're offering, will look at the identity of the potential supplier.
What does identity mean? It means showing that the company is structured and well-organized. Structured means having a well-organized production division with a production manager, a quality control process—which is extremely important—and the ability to quickly handle non-conformities, along with a well-structured and responsive after-sales service.
But how do they verify this on the website or social media? How can foreign clients see this from abroad?
Clearly, the website—this is where we get to the point—must convey this identity. In fact, one of the first pieces of advice given is to have a website that reflects this level of organization. That is, a website that shows the visitor that the company is structured into these divisions and has these competencies. Another critical aspect is the commercial and marketing expertise, which must be evident to show that the company has the ability and experience to present itself in international markets.
This applies to already established companies. Of course, if a company is entering international markets for the first time, it won't be able to showcase this, but it can still highlight other strengths.
Okay, are there other elements to evaluate?
An important element that should come across on the website is the company's historical experience. Every company has an identity built on its history; there is no abstract identity. The identity of a company is what it has done over time and what it has become. So, it’s essential that the company can communicate the excellence it has developed over time, ideally showcasing milestones achieved and results obtained.
Let’s put ourselves in the shoes of a potential client, who would definitely appreciate seeing a company’s evolution, from perhaps a small reality to one with continuous progression, gaining an identity capable of tackling foreign markets. However, it’s crucial that the company highlights the excellence in the product or service it is offering internationally.
Does this apply to exporting to Europe or globally, and are there areas more sensitive to a company’s history than others?
Yes, certainly. A company's expertise becomes more relevant the further you go. Clearly, when dealing with very different cultures, such as Latin American or Asian, there’s a curiosity from the client to see the company’s capacity and structure.
It’s clear that a well-structured company gives the impression that it can handle complex situations like distant international markets. In contrast, a less structured company might not pose a problem for a client in Switzerland, Spain, or Germany, but it could for a client in Southeast Asia, who expects a company capable of managing export at a significant distance.
So, between the lines, you're suggesting making the company appear larger, or at least emphasizing aspects that make it seem more structured than it is?
Exactly. Often when I search for clients for my clients, I think differently depending on the area I'm targeting. So, if I’m looking for a client in Germany, I don’t focus too much on the company’s identity, but it’s logical that the further I go, the more careful I have to be, because there could be more challenges. Different cultures require different approaches, and it’s important to reassure clients that the potential supplier can meet their expectations and make them feel secure.
Another important condition for internationalization is focusing on market segmentation. The company must know in which market segments it is strong and where it offers significant value. It’s crucial to start knowing where you can win and where you can bring important value to specific market segments.
These segments come from the company’s activities. Every company isn’t strong in all the segments it targets—in different industries, it will be stronger in some and weaker in others. It must have a strong awareness of where it can offer superior value, particularly against competitors.
Is one mistake you often see that companies approach foreign markets too generally, instead of focusing on their top products?
Yes, more than focusing on the top product, companies should focus on the market segments where the top product can be successful. Where there’s a winning offer. Market segmentation means approaching foreign markets in a systematic way, not as a whole, but in segments.
Another key aspect is having clarity about the company’s channel approach to the market. Is it a direct or indirect channel? There needs to be absolute clarity here because the market should be approached with great order. This aspect is not much different from the domestic market. If a company uses distributors in Italy, it’s likely that the product will also need a distributor internationally. Similarly, if it uses agents or brokers in Italy, they can probably be used abroad.
Finally, I’d suggest another fundamental condition that is often lacking: conducting a SWOT analysis before taking the first steps. Companies must be extremely aware of their strengths to use them as sales arguments and promote them both online and through the sales force.
Analyzing weaknesses is essential to address or mitigate them, knowing that every company has its weaknesses. And it's critical to know what opportunities the new market offers, in terms of trends, and what threats are present. You don’t want to be caught off guard in a market where, for example, e-commerce dominates when you were expecting a more traditional approach.
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