Have you considered conducting business internationally by exporting merchandise from the United States? If so, there are many factors you should take under consideration prior to engaging in an export transaction to ensure that the venture is a success rather than a failure.

This is the second in a series of articles that outline the steps that should be taken to successfully establish an export strategy.

Step 2: Gather Market Information

Once you have determined your company’s level of export readiness, you may then progress to the next stage of developing an effective export strategy by doing a little bit of research on your target market.

There are numerous companies of all sizes that have attempted to conduct business across international borders using the same methodologies that they used in the domestic marketplace. They have quickly found out that these same methodologies often do not provide the same level of return in the international marketplace.

In order to develop an effective export strategy, you must do your homework and cover all aspects of your proposed venture; otherwise you could quickly end up as a failure in the international marketplace and potentially damage yourself in the domestic marketplace as a result.

Which sources of information can a company tap into in order to obtain information about their proposed venture? There are many different sources that can provide this information including:

• Industry and trade associations,
• Financial institutions,
• Marketing organizations,
• International accounting and consulting firms,
• International corporate intelligence services,
• Local economic/industrial development agencies, Federal government departments and agencies, and
• State government departments and agencies.

Each of these sources may provide detailed information pertaining to certain aspects of your international business venture. The level of information that may be provided depends on the business venture of your company.

Once you have identified the sources that will provide the best information for your company, you should then consider exactly what information you wish to obtain.

What are some of the topics that a corporation should gather to develop an effective export strategy? There are many topics that should be researched such as the following:

• Are there any business practices that are unique to the target market that could hamper conducting business internationally?
  
• Are there any cultural differences that must be accommodated and, if so, what affect would they have on the corporation?
• Are there any aspects of the political environment of the target market that may hamper the conduct of business internationally?
• Are there unique aspects of the legal environment within the target market that may pose unique challenges for the company to overcome?
• How would the current production cycle be affected by conducting business internationally in the target market?
• How would the supply chain be affected by conducting business internationally in the target market as it would relate to potential regulatory restrictions on certain merchandise/materials?
• How would the distribution channels currently utilized be affected by conducting business internationally in the target market?

Perhaps the most important question of them all relates to risk. What is the risk involved in conducting business internationally and does it outweigh the possible benefits?

My next article will focus on bringing all of the information gathered during the research process into an export strategy that will serve as a blueprint for success in international trade.