Three actions to maintain your position in international markets
By originalsA research conducted by Sandhya Keelery suggests that Indian Agribusiness has seen a burgeoning rise in recent years and foresaw a 350 billion USD business in 2022. Gone are the days when only farming was considered the Agricultural industry. In today’s world, Chemicals, Crop distribution, Machinery, Seeding, Retail sales and many more domains are all part of international exchanges.
Do you wish to expand your consumer base? You need to execute an efficient global strategy to achieve a higher amount of business and, consequently, maximizing your profit ratio. We have listed what international strategy to adopt for your business below:
Table of Contents
International Events
Seminars and Exhibitions take place throughout the year. Therefore, companies have to participate in it to maintain their visibility, contact with potential clients and their knowledge of the market. These dealings are crucial for establishing connections and build relations. The relationship you create with vendors, buyers, even competitors in those meetings, will scale up your business in the international market. The conferences also provide you with a chance to display your products as well. Seeds distribution, for example, is promoted with a display counter showcasing your products in the symposia. You get to attend sessions with consultants and enrol in training workshops as well. The atmosphere broadens your horizons and makes you think out of the box. The build-up to your company’s profile can play a significant role in your quest.
After-Sale Services:
You could have all the technological advancements in your pocket, the best organic techniques in your resume, but it could all go wasted. You need to retain your customers! Your buyers need to keep coming back for your products, and the best way to ensure the retention of your clients is After-Sale Services. The problem with selling internationally is that you are mostly dealing through online communication means, and the handling of customer complaints is not efficient. You could set up and offshore call center, or invest in a local presence, be it through the office or a service center. If you are dealing with Agri-Machinery, and your client faces a mechanical hazard, your prompt service will ensure the customer will find you again.
Data:
Information is the secret ingredient. Developed countries’ individuals need transparency and access to information. When you are marketing your product or selling it, you need to provide all the required information. If your business is food-related, you need to let out the info about calories, vitamins, minerals, expiration, and origin, etc. Furthermore, you must maintain data of your current clients or potential customers. You can do this by creating an Email Subscription list, Telesales, and Memberships. Your record should contain the contact information, customer profile, purchase history with you. Harness the data and use it for introducing a new product or upselling your real commodity.
All in all, keeping your foot on Data, Services, and showcasing through the professional channel will make all your dreams come to life.
How COVID-19 crisis impacts food industry producers?
The virus outbreak is a worldwide tragedy and has a lasting effect on the producers of the food industry. Because the rumors revolved around more than facts in the pandemic, people were worried about food security. Food security is the availability of food items to all people, and it was questioned everywhere. Consequently, the general population rushed towards panic buying and started storing canned foods and long preservable food items.
The supermarkets and grocery stores were emptied out as a result, and a sudden rise in demand troubled many local food industry producers. With the closure of international borders, imports and exports are out of the equation. There is a dire need for local food producers to fill the gap. Many governments continued with the life-aiding products even in the lockdown. Grocery stores are open with limited operative approval. This creates a huge opportunity for local food industry producers.
Whereas the international food industry has seen a disastrous impact amid the crisis. As the epidemic is completely unprecedented, it moved every corner of the business world. The transportation restrictions, shipment bans have affected every profession. Russians have proposed the idea of keeping their grains’ production inside the country and not exporting the product. These crises are impacting food producers.
Although we empathize with the persons affected and their families by the virus, the financial crisis it has brought to the food industry is immense. We could have a food-crisis at our hands in no time. There are huge losses in incomes for the Food-Industry- Producers. Meat processing plants are closed in some countries, hence impacting the supply chain.
The producers who relied heavily on exporting their food items are suffering the worst with the border controls, and pandemic tensions. People are avoiding the use of food products coming from other locations, as it might contain virus imprints along. COVID- 19 pandemic has impacted the food industry producers who only, or mainly, exported their goods. Now, they are either closed or smart business persons who are looking to utilize the opportunities in the local markets.
Hoarding by consumers resulted in sudden empty shelves with no demand in the coming days from those buyers. Since the panic purchasers have stocked up the food items for weeks to come, they will not be buying those food items again in the coming weeks. Do not take empty shelves as a huge demand for granted, before storing excessively in your warehouse after filling the shelves, consider the actual demand.
Since eat-in at all restaurants is prohibited in most countries around the globe, there is a huge decrease in commercial food items. The food industry producers who were manufacturing commercial food items have been hurt badly. Products such as potatoes and milk have seen a sheer decline in the market’s demand.
Price gouging has also impacted the food industry negatively. Merchants have increased the prices above the agreeable rates without rationalization. This has gained them short-term profits but it has impacted the food industry in the long term categorically.
Management of international sales
International sales are an integral part of an organization in recent years. The common practice to enhance the business scope and grow the sales channel is to enter the multinational hemisphere. The reason for this endeavor is the saturation level of local markets worldwide. To mushroom the annual turnover, every business person looks for selling its products in overseas countries.
Although International selling is profitable and turns around the fate of an organization, it is altogether difficult to handle as well. The supervision of an offshore unit seldom becomes challenging to look after without the physical presence of the owner. Therefore, it is essential to discuss the internal strategies and external management techniques applied by the offices working abroad.
Furthermore, the primary problems include results’ inefficiency, import/export restrictions, and forex rate fluctuations. If a person in business starts to consider the risk factors involved without realizing the potential growth it may possess, they might start-off the wrong track. The simplest way is to outsource your foreign affairs to a competent company or recruit a sales-manager. These professionals organize and completely style-out the working to bring out the desired outcomes.
There is a growing trend of hiring managers, with the expansion of sale transactions outside the home country, who control the offshore management of sales. These managers are equipped with the ability and skill level to plan and execute the organizational vision. This hiring is an efficient way to ensure the business prospect sees its full potential.
The cross-cultural sales network needs an interface best designed to meet the growth targets. When you combine a motivated workforce with training and diversity, their skills bring about the desired results. Apart from training & development, we suggest that your HR should start employing expatriate recruits. It means gaining a competitive edge over the existing corporates of that specific country.
Building a relationship is the basis of International Sales.
Marketing Management of the offshore sales division is crucial. One needs to understand the cultural requirements and analyze the current trends to come up with a promotional strategy. Corporates are adhering to the most diverse and appealing advertisements. When you are selling abroad, you need to transform your positioning and create a positive brand image in the minds of consumers.
Building a relationship is the basis of International Sales. You cannot control the sales operations without having a network of references. Those links will help you find investing opportunities, increase the clientele, and grow your sales. Moreover, you need to develop bonding with your customers so that your brand is socially acceptable.
In the scenarios where you have distributors, your negotiations must be conducted in a well-organized fashion. You will need strategic goals, which are already set, to be on the same page as your wholesalers. This local network of business partners will play a key role in shaping your overall business in the country.
Internal management of International sales is all about hiring the right staff, investing in their training and development, and recruiting a sales manager. External management involves researching the right distributor, aligning the goals with them, advertising your product effectively, and building local relationships.
Managing Exports Risk In The Food Industry
If the Chinese Yuan weakens relative to India Rupee (INR), import of Chinese toys in India becomes relatively cheaper and therefore adversely affects the sales of Indian toy manufacturer.
Many businesses are going global! The expansion of any enterprise has not entirely flourished without indulging in the export function. There could be many reasons for exporting your products, ranging from better prices & more significant margins to market niche & business share. Whatever your reasons are for the export business, you need to be prepared for the jittery wind along the way. It has high risks of transportation, demographics, cultures, stereotypes, laws, and lack of time management for every industry. It is imperative to manage those risks to grow your business through exports.
As far as the food industry is concerned, many developing nations largely depend on their food exports. With high dependence comes excellent preparation! They need to ensure food safety and quality, meaning their items should reach their buyers in the global economy as per their standards. Keeping the global supply chain intact and every country playing its part by maintaining food control measures can manage it. If it is a balanced fit between industries and the Government, then the risk factor is minimized.
Budgeting is an export-risk factor. It depends on foreign currencies that keep fluctuating. A company’s budget could see an incline or decline based on the rapid variation of forex rates. However, in reality, the currency fluctuations even impacts companies with no dealing in international markets. For instance, a domestic toy manufacturer, who is competing with traders importing toys from China, is also exposed to fluctuations in the prices of Chinese Yuan (CNY). If the Chinese Yuan weakens relative to India Rupee (INR), import of Chinese toys in India becomes relatively cheaper and therefore adversely affects the sales of Indian toy manufacturer.
The other types of risks involved with exports can be either related to payment, transportation, customs procedures, or insurance …
However, in reality, the currency fluctuations even impacts companies with no dealing in international markets. For instance, a domestic toy manufacturer, who is competing with traders importing toys from China, is also exposed to fluctuations in the prices of Chinese Yuan (CNY). If the Chinese Yuan weakens relative to India Rupee (INR), import of Chinese toys in India becomes relatively cheaper and therefore adversely affects the sales of Indian toy manufacturer.
If you export the product without clearing the debt first, there is the risk of non-payment. Especially when you are dealing with new clients with no prior credibility, it is best to receive cash in your account before supplying. In the case of a regular client, you may afford to take such small-scale risks based on previous experiences.
“What if your client refuses to pay you the amount before receiving the product?”
Credit sales constitute a significant risk involved in the export industry. If you shipped a container of grains, for instance, on a 20 days’ credit, and the party refuses to lift stock from the shipment yard due to any given circumstances. This interruption will delay the payments and disrupt your cycle of debts. There could also be a scenario where your client claims the delivered product is unsatisfactory; hence, the fee is not cleared in time. We can not emotionally or morally influence the buyer in export business, whether it is only the food industry or as a whole. However, if it was a local customer, we could set up a real meeting in an instance and resolve the issue.
What if your client refuses to pay you the amount before receiving the product? Many people in the trading business and particularly in the food industry use a Letter of Credit. This document is a financial instrument that is secure for both sides without any risk. The payment mechanism in the export business usually revolves around the Letter of Credit. We can manage this export risk efficiently by using this instrument.
There are many risk factors, but if one learns how to overcome them or manage them, rest is only a heavenly story. Generally, all industries face risks, and the food industry is no different. The only thing that matters the most is the management of those risks. You could manage them by avoiding credit, introducing a stable exchange policy, ensuring safer financial instruments, and maintaining the highest level of quality.
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Ali Iftikhar
Ali Iftikhar is a Blogger from Pakistan and a Sales Manager with the experience spanning over a decade.
