Companies we partner with are highly aware of the fact that international markets can provide their food brands with steady growth potential. However, the challenge is, how do companies unlock that growth potential without experiencing problems that can cost a lot of time and money? Often times we see food businesses begin exporting by accident. Exciting opportunities will present themselves through inbound website leads or at large domestic trade shows, and naturally sales staff and owners alike become energized about the opportunity to make it big overseas! Within weeks, sales staff start responding to every international order and your operations team begins the cycle of chaotically trying to keep up.
Sound familiar? If so, you are not alone – numerous food businesses have walked that same painful path of going global. The good news is your company can begin to unlock new market growth potential and avoid such international woes by developing and implementing an International Strategic Plan. Below is Athena Marketing International’s 5 step process to developing just that:
- Step 1: Find Your HS Code & Begin Active Research
Conducting thorough market research is the foundation of your international strategic plan. Start off by researching your food product’s 6 or 10 digit (if available) HS number. The HS number, known as the Harmonized System classification, is a six-digit standard that uniformly classifies traded products across the globe. Once your product HS code has been identified, you can then begin to search for annual exports to specific countries under that product heading category.
- Step 2: Choose 2 or 3 Priority International Markets (go ahead, pick the low hanging fruit)
After you have researched numerous markets by your HS product category, pick out the top markets that indicate the largest volume potential for your products. Analyze each market and determine the competitive landscape, product demand, market size, growth rates, consumer demographics, and barriers to entry. Through this search and learn process, you will discover that some markets will have fewer barriers to entry. These will be the markets you’ll want to focus on and prioritize as they will provide large, quick sales opportunities without spending large amounts of resources or time on. Keep in mind too that your priority markets will possess a good infrastructure for distribution.
- Step 3: Develop Profile of Ideal Customer in Priority Markets
Now that you have your top two or three markets to focus on, it is important to understand the type of importer and/or distributor you want to work with. Prior to choosing the right one to work with, you’ll want to ask such questions as- What sales channels are they strongest in? Who are their main customers? How many sales representatives do they have? What other food products do they sell? All of these questions and many more should be asked prior to choosing a master importer/distributor.
- Step 4: Establish Pricing for Product(s)
Just like your domestic business, pricing is a critical component of your strategic plan. Export pricing should be the same or slightly lower than the discounted price available domestically. The reason for this is to avoid situations where international customers can bypass your importer and buy from a U.S. distributor at pricing that is lower than your pricing. Pricing should be developed in a systematic way so that your importer will have no difficulty in selling.
- Step 5: Develop a Platinum Product Launch Plan
When launching a new product overseas, it is important to approach with the same strategic care as you would in the domestic market. Plan and budget for tasting samples, trade shows, point of sales materials for importer and other sound marketing activities that are both a good fit for your brand and the new market.
Now that you have gone through all 5 steps of the International Strategic Plan, it is imperative that your management team and key employees possess a clear understanding of the plan and their role in it. Revisit the plan every time a new international inquiry presents itself and be sure to review it before attending any domestic trade show, such as Fancy Food or Natural Products Expo West.
Athena Marketing International is passionate about seeing agricultural products thrive in foreign markets. If you want to implement a strategic plan for your business and would like more hands on strategic assistance, please be sure to reach out.