How to Start an Import/Export Business

Marketing

As an international trader, your mission is sales--in two different but overlapping arenas: a) selling yourself and your company to clients as an import/export manager for their products, and b) selling the products themselves to representatives and distributors. Success in one of these arenas will contribute to your success in another. Once you've established a favorable sales record with one client's goods, you'll have a track record with which to entice other clients. And, of course, each success will contribute to your own self-confidence, which will, in turn, lend that air of confidence to your negotiations with new prospects.

Hunting for Exports

A surprisingly small percentage of domestic producers export their wares. So your marketing goal is to convince the huge remainder that they can increase profits by exporting--with your guidance--to specific target countries. You can accomplish this with direct mail and cold calls. If you're starting with imports, don't ignore this section--you'll work in basically the same manner.

Before you initiate contact with any manufacturer, you'll need to do some basic market research:

  • What products are hot sellers in the domestic marketplace? Focus your attention on products that you know well or use yourself, or that are bestsellers in their market niches.
  • Are these products hot sellers in your target countries?
  • If not, are there situations or markets that would put these products in great demand if the products were available?
  • Who manufactures these products?
  • What is the selling price of each product--and of competing products or brands--domestically and in your target countries?

Direct-Mail Dazzle

Now you're ready to begin your direct-mail campaign. Choose one manufacturer of one of the products you've researched. Then call the company and ask for the name of the person to whom you'll want to write. If the company is small, you'll probably want the president or owner. If it's a larger concern, you might want to direct your letter to the vice president in charge of sales, the sales manager or the president or owner.

Armed with a name and title, write your letter, taking care to address the following points.

  • Introduce yourself and your company.
  • Briefly outline the potential of the overseas market.
  • Outline the product's potential within that market.
  • If possible, explain why and how your company, out of all others, will be able to position the product best. For example, if you have experience with like products, be sure to say so.
  • If you already have contacts with foreign distributors, explain that you have foreign representatives for overseas sales.
  • Ask for a personal meeting to further discuss the possibilities.

Once your first letter is in the mail, sit down and write another to a potential client in another product line. And then another, until you've exhausted your first set of preliminary market research products.

Now wait a week or 10 days. If you haven't heard from your first target manufacturer, give him a call. Ask to set up a meeting in his office to discuss your plan. Then call the next manufacturer and the next. If you're not familiar with sales, you may find this portion of the program a white-knuckler. Don't be nervous! You're offering these people a terrific opportunity. Not everyone is going to bite (not everyone can recognize a great deal when it jumps up and grabs them), but not everyone is going to turn you down, either. A no thank you now and then is part of the game.

(Cold)-Calling All Clients

Cold-calling, so-called because you call a potential client "cold" without any warming up by prior contact, is an alternative to the direct-mail approach. The good news is that, if you're calling locally, it's usually cheaper than direct mail. The bad news is that it requires much more perseverance to be effective. The other good news, however, is that, done properly, a cold call can be much more effective than direct mail.

Before you make your first call, be sure you know what you want to say and how you want to say it. Some experts recommend writing out a sort of "script" that you can follow during the course of your call. This is a good starting-off exercise to help plan your spiel, but be aware of the fact that following a script has its drawbacks. The main one is that the person you're calling doesn't know he's supposed to be following the script, too, and when he gets off track, so do you.

Desperately Seeking Imports

How do you go about finding goods to bring stateside? You have several options:

  • Travel abroad on an import search mission.
  • Wait for foreign manufacturers to contact you.
  • Attend trade shows.
  • Contact foreign embassies' trade development offices.
  • Contact the U.S. Department of Commerce's International Trade Association.
  • Track down leads on the Internet and in trade publications.

Selling Yourself

You've located foreign manufacturers or suppliers whose products have U.S. sales potential. Now you have to sell them on the idea of entering the U.S. marketplace and convince them that you're the person to usher them in. How do you do this? Basically, the same way you'll pitch domestic manufacturers, with a direct-mail campaign. Only in this case, you'll do better to think of it as a direct fax letter. Although many traders rely on international mail, unless you're sending to regions or countries with highly developed infrastructures, such as Canada or Western Europe, you'll be much more assured of your missive reaching its destination if you send it by fax.

In your letter, outline the various opportunities available in the United States for the product and highlight that you'll handle all import logistics with little cost to the manufacturer. It's very similar to the export letter, with two exceptions:

  • You should address the letter recipient. For example, use Monsieur (abbreviated M.) instead of "Mr." if the recipient is French. Even though your letter is in English, this little touch shows that you do know something about the French language and that you've taken the care and courtesy to address the recipient in his own tongue.
  • Check to make sure you've eliminated any slang that may be confusing to non-natives.

International Call

Follow up in a few days with another fax. Think of the follow-up as a firm but gentle nudge, an opportunity to strengthen your position and demonstrate real interest in importing the merchandise. Remember that part of your task is to convince the potential client that your company is the best one for the job, so you have to supply a reason for this. If you can't claim that you're experienced in interior design (or mulch or whatever) sales in the United States and Europe (or wherever), then come up with something else. Maybe you're only experienced in the United States so far. That's fine! That's where you'll be selling. Maybe you're not experienced yet, but you've done a great deal of research. Fill that in instead. Use your creativity!

Marketing Plan

Whether you're planning on exporting or importing, be prepared to present your prospective client with a marketing plan. If the manufacturer is close to home, you'll naturally present it in person. If she's overseas, you may still have to (make that get to) arrange a personal visit to close the deal. If you feel strongly enough about the product's U.S. potential, the trip will be worth the time and expense.

To prepare your marketing plan, you'll need the information you've already asked for: pricing, product brochures or literature, and samples. If your prospect balks at supplying these materials, tell her that you'll need them to further explore the market potential and develop a presentation for her, outlining the market strategy you plan to pursue.

Once you have the materials in your office, sit down and figure out every possible expense you'll have so you can arrive at your sales price. Then, if you've already been in contact with distributors or representatives, find out if this price will sell in their market. If you don't have any representatives yet, you'll need to locate one and determine if he can work with that price. Assuming the answer is yes, you've got a viable product.

Now write out your marketing plan, which should include the following elements:

  • Target: Which country or countries will you or your representatives sell in? Why are these markets viable? Include positive market research information and be sure to assemble it in a clear, concise, easy-to-digest format. This is where your desktop publishing programs will shine--you can make charts, graphs and tables interspersed with facts, figures and text.
  • Sales: Explain at what price you'll sell the product, give your annual sales forecast, your fee structure and the profits the manufacturer can expect.
  • Marketing: Briefly touch on any special marketing or promotions for the product; for example, foreign or domestic trade shows or any local advertising your reps will do.

How to Start an Import/Export Business

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