For both beginner and veteran exporters, accessing new overseas markets can be daunting and costly – Rebecca Spicer finds that trade missions, market visits, and international trade shows can be a cost effective way of breaking down barriers to make those key first contacts.
So your products or services are export ready, and research tells you there could be demand in a particular overseas market. Now comes the challenge to develop key relationships and begin generating real sales leads. A new market entry program such as a trade mission or market visit could be the answer.
Although often used interchangeably, the NSW Department of State and Regional Development (DSRD) use the term ‘trade mission’ when referring to a broad range of companies travelling in a group to a specific overseas market. Market visits are industry specific and can be for a small group of companies from the same sector, or for individual companies, to visit a specific overseas market. Market visits will often coincide with a major trade fair or exhibition in that country. The relevant government department in your state, as well as Austrade and industry associations, conduct these programs and often work collaboratively with regard to financial assistance and delivery.
According to David McGeachie, director of trade services at DSRD, the number one benefit to most businesses joining a trade mission or market visit is making contacts and gaining market access. "The companies tell us that these missions are an effective way to get export business and to get it in a much shorter time-frame than if they went on their own," he says. "We work with allies and partner organisations in these markets to organise a program of meetings, site visits, or whatever activities are deemed necessary for that participant to meet their individual objectives."
Deciding on the best program for your business will involve a number of considerations, such as the type of business, products, and the business’s representative going on the mission. But, most importantly, companies need to select a program that will most likely meet their objectives.
McGeachie believes many companies derive comfort from being part of a group, especially as the mixed groups may also benefit from inter-trade within the group itself.
While the sector specific visits can benefit from an incorporated trade show and industry specific leads, some companies may prefer to go on an individual market visit to avoid travelling with competitors, or simply because the group visits aren’t scheduled to go to the company’s country of choice.
New market entry programs delivered by other agencies will vary in structure and delivery, and so it’s worth looking into what best suits you.
McGeachie advises companies to plan at least three months in advance of joining a trade mission or market visit as there is an application process to go through as well as a lot of planning once you’ve been accepted into the program. "The more lead time they’ve got, the better," he says.
DSRD, for example, have a two-step qualification process where, once businesses apply, the company is assessed on its export readiness for the particular market and then an assessment is done on the market potential of its product or service. "Once those two things come together, we accept them on the mission," says McGeachie. "We understand that they’re making a significant investment of their own time and money to go, so we want to make sure they’ve got the best chance of success. We make it clear to people participating in our missions that they’ll get out of it what they’re prepared to put into it, and preparation, like anything, is the key to success here."
McGeachie suggests the following key points to good preparation:
• Go with a very clear objective and realistic expectations. Don’t expect to make immediate sales.
• Be armed with professionally produced sales material and, if required, in the language of the country.
• Invest time in learning about the culture of the market and how people do business there.
• Go armed with a checklist of questions you want answered while you’re there.
David Smith, managing director of IT company, ComTel Resources, travelled to New Zealand on his first trade mission almost two years ago, to test the effectiveness of such programs. While he didn’t generate any direct business from that first mission, he says it taught him a lot about how to be better prepared. For example, it’s important to give the agency arranging your program an in-depth brief on your products or services, and don’t assume they know as much as you do about your business. He also suggests having your collateral ready, plenty of good handout material and, depending on your market, be prepared to haggle—in other words, "be prepared to do business the way they do business but don’t be shy about saying, here’s the way we do business". He says you should also be prepared to visit the country, perhaps two or three times, after the initial visit. "You have to follow up. Picking up the phone and sending emails doesn’t fly," Smith says.
He participated in his second trade mission to the UAE this year, and as a result of an appointment on the mission ComTel has delivered a pilot project for a large hotel group and have since identified a partner in the UAE.
In terms of cost to the business, it will depend what program you go on and who organises it, but if it’s a government-run visit the agency will cover some business-related costs. The company will generally have to pay for their own airfares, accommodation, meals and personal expenses. It is possible to claim these expenses through Austrade’s Export Market Development Grants, but Smith warns that this could take a year to come through and so you need to be able to cover the costs initially.
On one trip to the UAE, ComTel took part in a trade show, which Smith says was extremely valuable. "I wasn’t just flying through but investing in a trade show there, which was saying to them it’s worth my while being here."
Bear in mind that exhibiting at international trade shows can be quite costly to do on your own, and so as Smith says you’ve got to have that kind of funding allocated and "be ready to rock and roll".
An alternative is being a member of a network, industry association, or government body that exhibits at large international shows, held both overseas and locally.
VICFOODS is a network of 1,300 food and beverage companies in Australia and has a key role in providing export opportunities to growers and producers. According to director, Richard Brett, the network’s greatest success has been taking Australian companies to overseas trade shows where they exhibit as a group under the name Taste of Australia. "With the trade shows we attend, if a grower or producer wanted to exhibit in their own right they’d probably be looking at a cost factor between $15,000 to $18,000 to exhibit overseas," says Brett. "What we do as a network is divide the cost of the stands between all the growers and producers. We then freight all their samples together, we do all the documentation, we organise airfares and accommodation, and we go as a collective group. And it takes your cost down to about $1,500."
Members of VICFOODS can either opt to personally attend the expo or the network can represent the company’s products for them. Brett believes in a collective stand, it’s possible to generate up to 120 leads a day, which are distributed at no cost to all members participating in the show.
International trade shows held in Australia are another perhaps less expensive option f
or businesses looking to make international contacts. The annual IT show, CeBIT, Fine Foods Australia, and the Retail Business Technology Expo are examples of shows which attract international buyers. However, taking a stand at these shows can still be quite costly and will require a lot of time and effort before and after the event. Using the services of Austrade and state governments who have a presence at these events and often host additional events and seminars at the time of the show, is another cost-effective option for making those first international contacts.
For up-to-date information on trade missions, market visits, and international events, here are some key contacts:
Austrade: www.austrade.gov.au — visit the ‘trade events’ section.
www.embassy.gov.au — Australian embassies, consulates, and mission websites around the world.
NSW: www.smallbiz.nsw.gov.au — visit the trade missions and markets visits page of the export section on the site.
WA: www.doir.wa.gov.au/exportandtrade — the events calendar on this site has one of the most comprehensive lists of world trade events.
QLD: www.export.qld.gov.au — visit the ‘current events and projects’ page.
SA: www.exportsa.sa.gov.au — see the events link at the bottom of the home page.
NT: Contact Quentin Kilian, assistant director for international trade, Trade and Major Projects Division, Northern Territory government—ph: 08 8999 5205, email: firstname.lastname@example.org
TAS: Business Point—ph: 1800 440 026.
GIVEAWAY for Foodies!
If you’re a food or beverage producer looking at opportunities to export, DSB and Taste of Australia Exhibitions is giving one lucky reader the chance to have their food or beverage product displayed on the Taste of Australia stand at Food and Hotel Asia (FHA) 2006, for FREE!
FHA 2006 is the largest food and hospitality event in the Asia Pacific region and will run from April 25 to 28 in Singapore. This is your opportunity to meet more than 37,000 trade buyers from 61 countries, and generate new export business or expand your current market.
The competition is open to all non-refrigerated food, and non-alcoholic beverage producers in Australia, and is a package worth $2,000.
Forward a sample of your food or beverage product along with product information to Taste of Australia Exhibitions—5 Singer Ave, Glen Waverly, Victoria, 3150—by December 15 for your chance to WIN! For more information on Taste of Australia Exhibitions call VICFOODS on (03) 9887 7365.
All entrants will be acknowledged by Taste of Australia Exhibitions. The winner will be published in the February 2006 edition of DSB magazine. Depending on the number of products offered for display at FHA, there will be a freight component incurred by the winning entry and if the winner chooses to attend the Expo, they will need to cover personal expenses.