Exporting successfully: A ten-point checklist
Exporting is an opportunity and a challenge for Swiss SMEs. The following checklist will help you capture new markets. Step by step you will find out what you need to consider when planning your exports.
1. Set your export objectives
First of all you need to set your export objectives. The following questions may be helpful: Why do you want your SME to export? Do you have the financial and human resources? How much are you willing and able to invest? Becoming an exporter is only recommended if the core company is in good financial health, as exporting costs time and money.
2. Find a suitable country to export to
Once you have set your objectives the next thing is to find a suitable destination country for your exports. This involves gathering basic information about potential countries to export to. The financial, political and legal situation in these countries is particularly important. The State Secretariat for Economic Affairs (SECO) provides an overview of the economic situation and bilateral relationships of Switzerland's key trading partners in free country profiles. Once you have chosen a country, it is worth making a trip there to see whether it lives up to your expectations.
3. Analyze the competition
A common mistake made by SMEs exporting for the first time is to underestimate the competition. An analysis of the competition is therefore essential in order to assess the product's potential in the new market. What national and international companies have a local presence? Is there room for another player? How can you stand out from your rivals?
I recommend drawing up a business plan with clear milestones and truly realistic goals.
Stefan Gerig, Head of Export Finance at Credit Suisse
4. Draw up an export business plan
Prepare a business plan for trading abroad. What is your strategy for capturing the new market? What are the opportunities and risks? What resources are available, and what revenues can be expected? Set out your plan of action, including a timetable. Information as well as templates and forms are available on the Credit Suisse Business Easy platform.
5. Obtain financing for your exports
It may be a while before you see the first revenues from your exports. That's why it's important to ensure you have the financing needed to cover this period. Credit Suisse supports SMEs with bespoke loans and financial products. This enables SMEs to bridge the period until they receive payment for the products exported.
6. Find a suitable partner
Exporting can't be done single-handedly. It's important to have local partners, who can help SMEs network, market products, or set up a branch. Start searching for potential trading partners in good time. Switzerland Global Enterprise (S-GE) will help you do just that. S-GE has an excellent network of contacts in many markets, and brings potential partners together.
7. Check the customs regulations for foreign trade
Customs regulations are crucial when it comes to selling your products abroad. Customs duties, value added tax, and other charges can considerably reduce the profit from the sale of products. Find out whether your products are covered by a free trade agreement, and which documents you need for exporting. Being able to describe their products as "Swiss made" is often crucial for SMEs. The "Swissness" regulations were tightened up in 2017.
8. Find out more about the rules before you start exporting
In addition to customs regulations, many countries have additional rules on products, sales, and taxes. Indeed these trade barriers have recently been increased. SMEs should not be deterred by this, but they do need to be well-informed.
9. Protect yourself against export risks
Exporting always carries some risk, no matter how well thought-out the export strategy. These could be political, economic, logistical, or administrative risks. Hedging can be a good way to protect the company from these risks. For instance, SMEs can protect themselves with the help of the Swiss Confederation's Swiss Export Risk Insurance organization. Those who maintain business relationships with foreign business partners are exposed to the risk of fluctuating exchange rates. Credit Suisse trading teams and specialists based in all regions of Switzerland will be pleased to answer any questions about foreign exchange.
10. Allow plenty of time for exports
Exporting isn't something that happens overnight. You need to allow plenty of time to establish your business and product in a particular country. You should also review your business plan at regular intervals. Is business developing as planned, and is your timetable still on track? If business has developed in a completely different way than expected, think about halting your export plans before you lose a lot of capital.