Exporting doubles the chances of success than only operating in the domestic market according to a study conducted by IHS Global Insight and DHL Express. Learn about the main reasons to give it a try and start creating your export plan:
Food companies should obtain market intelligence of the countries where they wish to export
- Growth: the increase in size is a natural result of internationalization. The growth in demand leads to an increase in production and sales.
- Diversification of risk: globalization increasingly drives demand for products. If for any reason the local market shrinks, companies that operate internationally will be less affected. By exporting, companies increase the number of clients whereby the decline of orders will not impact their returns.
- Economies of scale: a higher demand can allow companies to increase their production and thus, make them more profitable. If there is a surplus, they have the possibility of placing it abroad, regardless of the season or other factors that affect events at a local level.
- Innovations: when companies compete internationally they must adapt to the latest technologies and obtain certifications. These factors enable their growth and also allow them stand at the forefront in the local market.
- Tax benefits: by operating internationally, companies can reduce the amount of taxes that they have to pay.
- New skills: in order to grow and export, companies must improve their own tools for competing; for example, by training their staff. This will allow them to adjust the production based on the existing demand.
- Image: access to the international market can boost a company’s prestige in the domestic market.
Look at some tips provided by MVD Consulting, from Uruguay:
4 tips for food products
Quinoa, organic products, stevia and chia from Latin America and the Caribbean can find excellent opportunities in accessing international markets. This follows from a research study conducted by Duke University for the Multilateral Investment Fund (MIF) of the Inter-American Development Bank (IDB).
Small and medium-sized producers in the region should consider these tips:
- Follow sanitary rules: food products are subject to a series of sanitary and phytosanitary rules to guarantee their safety and quality, and to prevent the spread of disease. Since these food products have a considerable higher value, they may represent an attractive source of income for small producers.
- Perform market intelligence: before exporting, it is very important for food companies to study the tastes and habits of the countries where they are considering selling their products. It can start with simple inquiries such as looking up restaurant reviews on the web and going into supermarket websites to see if they have similar products.
- Participate in fairs: in order to contact possible distributors and buyers it is essential to attend trade fairs, which are a great opportunity to contact prospective customers, distributors and suppliers. One of them is LAC FLAVORS that will be held in September 2015.
- Contact chambers of commerce and promotion agencies: official representatives from each country can assist with the export process. Logistics and export advisors can also provide very valuable information and speed up international procedures.
Listen to Rachel Olortegui from Ecoinca, Peru talk about her experience: