A weak Rand means that South African products can either compete at more competitive prices in international markets or, if priced at the market rate in an international currency, more profit can be obtained from a sale.
With the vast enhancements in global communications, ease of moving goods, growth of internet trading portals and increase in English literacy global trade is becoming easier than ever before. Below are some ways to start or grow exports.
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Create a marketing strategy tailored to the international market targeted
For companies new to exporting it is advisable to start with a single product and a specific target market from where you can expand.
Spend some time researching the country/ies that you intend to export to. Research your competition. Are there local suppliers in the country? At what prices are comparable products selling both from local supplier and on the international market.
Does your product have any unique properties that may appeal to the target market you have chosen?
When creating your marketing material and strategy take into account the culture, language, ethics and religion of the local population and tailor your approach to appeal to them.
Marketing strategies to find buyers
An effective international marketing strategy may include:
- Promoting products on established internet based business to business trade portals.
- Attending international trade shows where you may showcase your product, arrange to meet with potential buyers attending the show or conduct market research.
- Identify and target potential buyers in the proposed country of export directly. This can be done through making use of an agent or business partner in that country, by doing local internet searches in that country or through contacting trade associations such as the local chamber of commerce.
- Use social media platforms such as LinkedIn to gain contacts in a targeted country.
Make use of export grants and trade agreements arranged by the South African government
As part of their efforts to boost the South African economy and support GDP growth the South African government has a number strategies in place to support export sales.
One of these strategies is the export grants available through the Department of Trade and Industry (DTI). Financial support is given to exporters to use on market research, trade missions, attending trade shows and hosting international buyers.
Costs covered by the grants may include exhibition fees, air tickets and a daily expenditure allowance whilst on an international marketing trip. More information on the DTI grants is available here.
South Africa is also part of a number of trade agreements that allow exporters to sell their goods with little or no duty tax being charged to the international buyer.
This lowers costs for the buyer and makes the goods more attractive. The most notable trade agreements are with a number of Southern African and European countries.
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In order to qualify for the reduction in import duty each export to these countries needs to be accompanies with the appropriate South African certificate of origin. More information on trade agreements is available here.
Breaking into a foreign market may take longer than generating local sales, however the effort spent establishing an international client base may support your business for years and serve as a buffer against a drop in the South African economy.