A go-to guide on exporting in Latin America
While the concept of coming from humble beginnings and then achieving success has come to constitute the “American Dream,” it’s actually a goal shared by many around the world. It’s a goal for many business owners around the world – from large companies planning to embark into exporting to mom-and-pop shops looking to sell their family’s cigars from local to overseas markets.
Entrepreneurs ask themselves, “Where do I begin?” “Can I make the jump to exporting?” “What are other companies doing that I’m not?” From questions like these stems the ambition to expand abroad and the curiosity to find the best ways to do so. If you can learn from those that have made the leap, then you gain a competitive advantage.
The UPS Business Monitor™ Export Index Latin America (BMEI) surveyed executives from some of Latin America and the Caribbean’s leading small- and medium-sized enterprises (SMEs) to analyze their best practices in exporting.
Some of the insights shared by executives surveyed include:
Develop a dedicated export team. Creating an in-house department or designating an area within the organization dedicated to exports facilitates export operations. A dedicated department can develop new customer leads and coordinate market planning, research, products and promotions – all leading to international sales.
Be flexible — offer a range of transportation modes. Carrying out timely delivery of orders was noted by survey respondents as one of the most important elements to meet customers’ needs in foreign countries. Understanding that on-time delivery of export merchandise is key to the development of sales, a large majority of survey respondents indicated using multimodal options to send their shipments (land, air and sea).
For non-urgent, high-volume and low-value shipments, for example, slower modes of delivery such as ocean freight are recommended. Conversely, for high-value, low-volume and more urgent merchandise, it’s recommended to ship via international air and/or ground couriers.
Research, experiment and learn from it. Ongoing training and education can help staff stay current on export industry trends, best practices, products and processes. Export markets demand that companies have specialized personnel to generate more export activity.
Do your homework. Researching markets before trying to do business there can save time and money in the long run. Partnering with universities, research centers and chambers provides increased development of knowledge and technologies. This permits an interchange of new ideas, individualization of new products and processes and the application of technological innovations.
The survey also found that many executives evaluate product availability and consumption habits of consumers in their target markets to determine their export strategies.
Find the right logistics partner. Relying on a logistics partner to help navigate export requirements.
Respondents said it is important to choose a logistics partner with an international presence and proven track record. The logistics partner should be responsible for planning and implementing a logistics infrastructure necessary for ensuring export deliveries.
In addition, partnering with a multi-service logistics partner can offer SMEs solutions such as customs requirements and export tax structures, which were mentioned by surveyed executives as major export barriers.
Hashtag, Like, Tweet. Using multiple online communications, including social media vehicles to maintain contact with customers in foreign countries. Today, there are voice and video applications that make it possible to use an Internet connection as an alternative to conducting business by phone. Even social networks have started to become relevant for business.
Online advertising is another promotional strategy used by a majority of survey respondents to introduce their companies and products to customers abroad. Additionally, respondents utilize social media and online business directories as a way to communicate information.
With SMEs representing 90 percent of all companies in Latin America and generating 50 percent of jobs in the region*, the outlook for businesses reaching their own version of the “American Dream” looks promising.
The UPS Business Monitor™ Export Index Latin America is designed to serve as a guide for entrepreneurs looking to expand into international markets and as a reference tool that provides check points for currents SMEs in the export business.
Click here to download the complete report or for more information regarding the study and its insights.
*Latin Trade Business Chronicle April 2014