Export strategy is frequently mistaken as a race to plant flags in as many countries as possible.
Top management spends too much time reading economic reports pushing the export department in the uncertain direction of BRIC countries while ignoring opportunities on their doorstep. Exhibitors at Anuga or ISM act as traders at a Turkish Bazaar negotiating over terms and conditions without focus on requirements for “brand building”. The reality is that Export development is about creating a sustainable, long term strategy that can deliver consistent results.
Map to Future
A good strategic plan should be visionary, conceptual, directional, and compatible with the companies overall business goals for a 3-5 year period. This contrasts with your annual business plan which represents a short term operational plan focused on measurable tactics. A viable long term strategy identifies megatrends, addresses important challenges, and creates new sources of advantage. Strategy requires making business choices, including tough decisions on which countries to enter, the right brands to support, and where to allocate company resources.
The first step is to conduct a “Lessons Learned” analysis. This fact based study should detail current metrics by country. Evaluate sales per capita, market share, profit margin, and three year sales history.
Results should be segmented by country size and distance from your producing facility as well as “route to market” model. Export Solutions recommends a second stage “20/20” Analysis where you look at all market metrics and you separate the “Top 20 %” performers versus the “Bottom 20 %” performers. What are common characteristics in the countries where you are winning ? Are there similarities in markets where your company is “under- performing ?” . A solid Lessons Learned analysis guides our strategic choices for your new export strategy.
What does your company do well ? Which product categories, services, or regions do you out perform your competitors and drive category value ? What factors distinguish your company from other category performers ? Your strategy should sync with segments where you maintain a sustainable advantage.
Export Strategies can be doomed from the start when lofty business ambitions are not matched by realistic investment levels to meet desired objectives. Investment comes in many forms: research, marketing ,trade promotion and most importantly human resources dedicated to a project.
Strategy – OGSM
One approach that encompasses both the Strategic and Operational aspects of the business is “OGSM”. OGSM stands for the process of developing a document outlining “Objectives, Goals, Strategies, & Measures. This “Plan on a Page” provides a clear and concise guide to your expectations.
OGSM serves as a vital link between long term strategy and short term business demands.
Successful international development strategies reflect a focus on a narrow band of countries and activities. Industry leaders such as P & G, Nestle, Kraft and Barilla typically dedicate substantial resources to the ten countries that account for 60 % of their business. This approach must cultivate a mix of established markets with “new frontier” markets which offer exceptional potential.
This does not advocate ignoring smaller markets and opportunities. It signals a message that not all markets should be treated alike with similar programs and resource allocation. I remember a client whose Latin America business had been stagnant. My analysis revealed that his area manager devoted his time to customers in Central America and Caribbean with minimum energy dedicated to Mexico, a market with 115 million people, but tough to penetrate. The new strategy committed to exponential growth in Mexico , with the manager spending 50 % of his time in Mexico. End result was Mexico business doubling!
Export Solutions Can Help !
Export Solutions has participated in more than 300 international development projects on five continents. We frequently provide guidance for export strategy development as well as validating proposed plans. Our export strategy templates can be rapidly adapted to fit brands for any supermarket category. Customer feedback suggests that Export Solutions strategy insights can save you time, money , and “wasted” effort.
Export Strategy Road Map Questions
What are your business ambitions for the time period?
What factors have contributed to export success?
What situations have led to export disappointments?
What countries represent your top 20% performers? Why?
What countries represent your bottom 20% performers? Why?
What is your competitive advantage?
Why is your brand unique versus international competitors?
What are the biggest export opportunities for your company?
What represent high percentage, profitable opportunities?
What is your investment model? Marketing, Promotion, People.
What alternatives are available?
One page plan defining Objectives, Goals, Strategy, Measures
What activities are required to achieve desired results?
What are realistic measures and benchmarks?
Strategy questions? Contact Greg Seminara at Export Solutions (001)-404-255-8387
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