There is also the thrill of knowing that your business can compete against the best in the world – and succeed.
Advantages of exporting
Advantages to your business from becoming an exporter include:
Additional sales
Exporting can help increase sales by extending your market base to overseas countries where you can find new customers and niche markets.
Increased profits
Despite the added costs of exporting, you can save costs by producing on a scale that makes better use of resources (economies of scale), leading to higher profit margins.
Faster growth
Selling in an overseas markets can help your business grow at a faster rate than if you were confined to New Zealand markets.
Reduced local market dependence
Selling in different countries diversifies risks such as exposure to New Zealand’s economic conditions or seasonal factors. During a local economic downturn your overseas customers may be unaffected.
Improved innovation
Exposure to new ideas, technology and processes can help you company develop innovative products and services.
Greater competitiveness
Trading in the global marketplace increases your exposure to international best practice, ideas and alternative ways of doing business – improving your chances of competing at home and overseas.
Challenges associated with exporting
Exporting also brings its own set of challenges and risks. These may include:
- increased costs
- complex regulations
- legal risks, which may arise from operating under laws that differ from New Zealand law
- political risk if trading in a politically unstable country.
For information on addressing such risk read the OECD’s Risk Awareness Tool for Multinational Enterprises in Weak Governance Zones.
Expert advice and planning including an export plan and risk management plan can help minimise risk.
