Choose an overseas market
- Step01
Identify what your place in the market would be
Work out what your customer in that market would expect, and how big your potential customer base would be.
- Step02
Consider costings
Look at the cost of shipping and manufacturing for that market.
- Step03
Identify what matters most to your business
For example, distance may be important if your products are highly perishable. Being able to employ highly skilled staff may be critical if your company prides itself on excellent after-sales service.
- Step04
Understand who your competitors are
Work out how your offering is different to theirs and how you can identify your point of difference.
- Step05
Look at the practical aspects of that market
For example tax, compliance, and marketing and branding requirements.
- Step06
Limit yourself to low-risk countries
Exclude markets that are politically unstable or where it may be hard to get profits out.
Other markets to consider
Free trade agreements
You could also think about countries that New Zealand has free trade agreements with. Free trade agreements are arrangements between countries that remove barriers to trade, create opportunities, and give businesses more certainty. For example, countries might streamline processes or might not impose tariffs.
Networks and connections
When you’re choosing your overseas market:
- look to build your networks and connections in that market
- make sure you visit the market before you finalise your decision.
Australia may be a logical first choice for many New Zealand exporters. It’s a good test market before exporting further away. Australia is close, English-speaking, politically stable, easy to reach and is somewhat culturally similar. You can export New Zealand-made goods duty-free too, under New Zealand–Australia Closer Economic Relations.
Free trade agreements in force - Ministry of Foreign Affairs and Trade
Plan your research
How long your research will take you depends on what you already know and how much time you have, but don’t be surprised if it takes months. Save yourself time and money by prioritising the most important areas and being well prepared.
Ask yourself these questions:
- What information do I need?
- Where can I find this information?
- Why do I need this information? What will I do with it?
- When do I need this information?
- What is this information worth in dollar terms?
- What is the likely cost of not getting this information?
Organise your information
Because research is so valuable and time consuming, make sure you save information safely and back it up. Organising information by country is particularly useful.
You should:
- keep a file for each country where you do business
- keep information updated
- consider including things like product, advertising and labelling changes.
Comprehensive information will:
- make your file a rich first source of information when you make decisions
- be a good way for new staff to learn about the market.
Make sure more than one person in your business can access your research. That way, you won’t lose it when an employee leaves and others can update it.
Do the research
About your market
Find out the opportunities and challenges. These figures are important indicators of the market potential for your goods or services:
- the market size, both in geographical size and dollar value
- market trends
- competitor products
- consumer spending patterns
- income per person (per capita income)
- tax, compliance, shipping costs, supply chains and other obligations.
Don’t just look at country-level figures. When you pick a market, it doesn’t have to be a country – it could be state or province.
For example, in the US there are big differences between states in consumer trends, costs and legal obligations. You may find urban–rural differences too.
When you’ve decided on a market, sign up for market intelligence reports to keep on top of what’s happening.
Sign up for market intelligence - Ministry of Foreign Affairs and Trade
About your competition
Knowing your competition well is essential. Visit their sites and find out:
- what goods and services they offer
- how they market and price those goods and services
- if you need to adapt what you do based on that.
About possible partners
If you’re thinking of partnering with another company to manufacture or distribute, research that company carefully first.
About trade and production statistics
Examine the trade and manufacturing statistics for your market over time to find out if the market for your type of goods and services is growing or shrinking.
You should also find out:
- what’s made locally in that market
- what’s imported, and from where.
About legal and regulatory requirements
Find out:
- what taxes and duties you’ll need to pay
- what laws and regulations you’ll have to follow.
Laws and regulations in your potential market can be barriers because they make exporting costly, hard, or both. Barriers created by government policies and regulations often mean you have to:
- carry out administrative procedures
- restrict how much you can export
- license or label products a certain way
- store and protect data a certain way
- appoint certain types of people to your board
- procure materials a certain way
- limit the price of your goods or services.
The New Zealand Customs Service and freight forwarders can tell you what different countries require. Your local Chamber of Commerce may also be able to help with export documentation.
About Intellectual Property (IP)
Find out how to protect your intellectual property, copyright and trademarks. Protection is especially important in countries that tend not to respect IP.
About culture
Understanding local customs can make the difference between winning a contract or not. Find out the cultural and business dos and don’ts in your market, and think about how you’ll overcome cultural or language barriers. For example, in some cultures, taking a business card without studying it is considered disrespectful.
Protect your services' intellectual property
Stopping someone from copying your ideas is always important. Be extra careful when you sell a service, a process or a unique way of working.
Check the intellectual property law in the other country when you’re choosing an export market.
You should also either:
- register your patent in your overseas target market, or
- apply for a patent under the Patent Co-operation Treaty.
Applying for patents in different markets is worthwhile. The process includes searches for existing patents, so you’ll find out if you might infringe on any.
International patents - New Zealand Intellectual Property Office
Learn more about finance and modelling
If you’d like to make better financial decisions, use our free resources to improve your understanding of finance and financial modelling.
Get financial help
If you’re ready to export but aren’t sure you can afford it, you might be able to raise money. For example, you could:
- get funding from angel investors
- get investment from friends and family
- sell a share in your company
- apply for grants, subsidies for training, or other forms of help.
New Zealand Export Credit gives trade credit insurance and financial guarantees to exporters.
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