Are you confused to start an export business with which products? Do you want to learn how to choose the right products for the export business? Have you ever thought about how to find the best products for your export business? Let’s learn and discuss to select the best products to start an import-export business together in this post.
I would like to talk to you about one of the most important decisions in your export business. In this article, we will learn how to choose the right products for the export business. And this is a key factor for your success in exporting.
I have worked with countless importers and exporters, and they are in the trading business for several years and have found success in this field.
The mind wanders, it goes without saying that these companies earn millions of dollars from having customers that are not only within a country’s border but how did they reach such levels of success?
The more important question is, how newcomers, like yourself, can enter this exclusive club of elites and start a business of exporting products?
Now, I combed through my network of customers, and freight forwarders, and I found out that a big portion of the exporters does not even manufacture the products themselves!
The light at the end of the tunnel perhaps, is that an importer or exporter does not need high investment capital to start an import-export business.
The internet has made the trading business wide open for entrepreneurs to storm in headfirst. Trust me, I am in the industry for over 15 years and I see how this has shifted trading patterns from larges scale to E-commerce sized parcels.
And when I talked with these people who achieve success in the import-export business. I found two key factors that you have to get straight. The first one, where do you sell? This is your target market. And the second one is today’s topic what do you sell?
Selection of export products for sale has got to be the toughest decision you will face when starting an international trade business. It should be the first step you take even before getting into the details on how to start an export business. If you get it right, the rest will be a walk in the park. I have compiled a checklist to help you make the best choice in this regard.
By the end of the article, you will know how to choose the best products for your export business.
Okay, let’s start with number one of my checklist.
1- Understanding Your Target Market.
Your selection of export markets will dictate a host of other considerations. You need to find out what export products are in high demand in that market. Look for the country’s trade statistics going as far back as possible. Aside from that, you need to think about cultural and language differences. Each of these will present a unique challenge.
Many times I imagine that the fewer the challenges, the better for business. But at times, the most challenging markets offer the greatest potential. To find out whether you can surmount the obstacles and make a kill. A popular recourse is to find sales agents in the target market whose knowledge of local culture will make for smooth sailing.
It is also essential to consider the business environment in potential target markets. Think about how the transport infrastructure, weather, and climate conditions will impact your trade. The political situation, as well as government policies in place, also plays a role in this. Countries with a record of political upheavals do not make the most conducive trading partners. Economic factors should also be considered as they determine currency fluctuations and growth potential for export business opportunities. Choose a country with a promising Gross National Product and an increasing per capita income.
Conflicts will always arise in business and you want to be sure that your interests are protected. Find out if the legal framework in a target market is likely to protect your product comprehensively. This is particularly applicable if you are thinking of selling software. Your product in this case needs protection from piracy.
What kind of record does this country have in enforcing anti-copyright laws? Look beyond the laws in place and find out how related conflicts are handled. If the system seems lenient then you need to change either the product or target market. Always think about how well your company will operate under any country’s laws before venturing in.
When you have this tricky part figured out, now you can start thinking about creating an export buyers list in the markets you find viable.
So let’s move on the number two.
2- Product Familiarity
With thorough knowledge of the target market, you could begin to formulate a product list of promising items. However, just because a product has high demand in a particular market does not mean you should start trading in it. Only go for those items with which you are familiar. Starting a business with a product you know nothing about is a sure recipe for disaster.
Yes, this is a deal-breaker, if you are not a product expert, you might as well stop pursuing this path as it will lead to wasted blood, sweat, and tears.
Again, I cannot stress enough that knowing your product inside out is the key to succeeding in this business. You cannot just pluck a product from the sky and look for a distributor to sell overseas if you can’t even sell the product to yourself. That is suicide.
I think that you already know this deep down without needing me to tell you. But I’ve seen so many entrepreneurs jumping in without even physically touching the product.
Before getting down to the details of exporting and finding customers, understand the product thoroughly.
In some cases though, a high level of interest in a particular line of products is all that you need. When you have a passion for something, learning about it is much easier. It will give you the motivation needed and ensure sustained interest. So think about your hobbies and experience and from the list of promising products, pick the ones that meet this criterion.
And the second option, in this case, partnering with a product expert. For example, we work with some sales agents in our solar lighting business at Solar Solenturk. We provide a technical education booklet about solar lighting to our agents before they start to work with us. Also, if you want to be our sales agent in your country or region, you can email us that I give the details below.
IF YOU WANT TO BE OUR SALES AGENT, HERE IS WHAT YOU DO FOR IT:
So now we’ve come to number three.
3- Product Trends
The viability of any business idea should be evident from prevailing product trends. But you need to dig deep to ensure long-term sustainability. Looking into the performance of similar products over a significant period will help you devise a good export business plan.
You should be able to study the factors that affect product demand and pricing. Look at the variances from past performance and monitor current trends. This gives you a thorough overview of the select items and helps you make an informed decision.
If you get this part right you might be on to something big. You may be able to foresee the next trend and get on board at the very beginning of a product cycle. Many times, the earliest risers make the biggest kill on new trends. By the time the rest of the world catches up, you will have yourself a following and your brand may be the new household name.
So that’s it on product trends. Now moving on to the number four.
4- Associated Costs
As you study specific product trends, you want to be able to determine whether or not they will offer a good profit margin. This entails calculating all costs involved. Some import-export traders fail because they forget to factor in the extra expense that comes with overseas trading. Find out the delivery terms from different suppliers, insurance charges, export certificates, and the shipping cost.
With these points considered you are now able to determine the total cost and expected profit margin. Make sure that your export pricing procedure takes into account unexpected eventualities like inflation and allows for relevant adjustments.
Remember those good sales do not guarantee good returns when overhead expenses are high. So strike a balance before settling for any product.
So let’s turn to the number five.
5- Growth Potential
You need to use historical research data to determine a product’s prospects. In addition, you need to think about the combined market size for a particular product. If for instance, you want to export to Africa, how many countries on the continent offer a viable market for what you have in mind? What are the market growth rates for the product you have in mind?
A comparison of desktop and laptop growth rates will show that desktop demand is on a steep decline. E-books are performing much better in most markets than physical books. How long are these trends likely to last? Avoid fads because even though they promise exciting immediate rewards, their flames burn out all too soon.
Product types also determine growth potential. Household consumables seem to offer higher viability than electronic items. Even though their profit margins could be lower, they are used every day and therefore in constant demand. But consumers take much longer to upgrade TVs and refrigerators. How often will customers buy your products?
Okay, now I would like to discuss the number six.
One of the most crucial criteria for the selection of products for exports is availability. The product selection process should in effect go hand in hand with supplier search. The information gathered up to this point might give you a rough idea of the quantities needed for your target market.
Armed with this data, you can talk to suppliers and find out their production capacity. Establish whether there are any challenges in the processes involved that would complicate dealing in the shortlisted products.
Adequate supply ensures pricing stability and makes it easy to build lasting trade relations. You can be sure to deliver the required quantities to your customers as the need arises and within stipulated time frames.
Okay, so, let’s move on to the number seven.
7- Trade Regulations and Restrictions
Every single market has a unique set of regulations. Export documentation procedures vary from place to place as do compliance requirements. The same applies to products. Some are restricted in some markets and allowed into others. Some require special certification or have to meet some pre-specified conditions to be accepted. This could swing either way and either make your idea of a success or a complete failure.
Many traders look for the least complicated products that can be sold immediately without a long list of procedures. This leaves a gap for restricted products. Focusing on few target markets could allow you to take advantage of this. If you choose to deal in the restricted product line, all you need is information and you are good to go. Talk to all the relevant authorities to make sure you get the details right.
So let’s turn to the number eight.
8- Adaptability to Different Markets
Many import-export traders deal with several markets at a time to spread out risk and maximize gains. But great product performance in one market does not guarantee similar results elsewhere.
So the best products for a startup would do well to be adaptable to several markets. This will simplify the sourcing process and help you not to spread out your resources too thin.
The most successful export products are those that can easily be adjusted to suit different target markets. Simple adaptations in taste, color, packaging, or design are all needed to make the item to the different markets.
Okay, I have explained what is adaptability to different markets. Now, I would like to discuss the number nine.
Knowing your competition in any given industry is important as it helps you project product performance. Highly competitive industries have very high entry barriers and require extensive marketing campaigns. The most strategic competitive point is offering lower prices than your competitors. But this might throw you off balance, even resulting in loss if you’re not careful.
At the same time, venturing into an industry with low competition comes with its unique challenges. Market awareness and consumer knowledge in such product lines are limited. This means that you and your few competitors hold all the cards. Find a way to differentiate yourself and you will easily dominate the said industry.
The key here is to study competitor dynamics and determine a foolproof way to make the most of the situation. Find a unique angle that allows you to set yourself apart from the rest. This way, your product will be certain to enjoy success. If you cannot find any such angle, move on to the next item on the list.
So, now we have come to the last one of my checklist.
10- Product Analysis
To commit to the success of any product in the market, you need to give it adequate attention. Think about it from all possible angles before launching it to the market. Start with a thorough self-analysis to establish an emotional connection.
Pick out every item on the list and think about whether it excites you, whether you would buy it. Do you trust it enough to sell it to friends and family? Would you enjoy dealing in that product line for the next decade?
After this soul search, think about the item from the consumer’s perspective. Does it offer to improve their life in any way? What pain point does it address? What kind of clients would be interested in the product? What are your feelings toward such people? Is the item in any way superior to what is already in the market?
Think through its production, promotion, and sales processes. Think about warranty, guarantee, and replacement issues. Think about whether the profits you hope to generate justify the expenses you will incur in these processes. If the answers to all of the above questions make business sense then you have yourself a product for export.
These subjects do not do justice to how complex the business of import and export is, but these are the key areas to start to analyze whether to even start considering venturing into product trading.
Congratulations! You have officially learned how to choose the right products for the export business. Now start booming and make the world your business!
Also, if you would like to learn more about international trade and business you can watch videos here on my YouTube channel.
Now I would like to hear your thoughts:
I want to make sure you get this and prove it to me.
I just want to make sure you understand these basic subjects of choosing products for export business, because It is a highly rewarding industry.
I urge you to enjoy the process. Happy exporting!
Thanks again for reading my post today.