EXPORT PLANNING WORKSHOP Noel Watson Aaron Parke Govind Seepersad Denise Leander-Watson Instructors Presentation Slides March 22-23,2012
Structure of the Presentation • Learning Objectives • General Introduction • About Export strategy • Export cycle • Getting ready to export • PART 1- Research stage • Market and industry trends • Export audit • Market audit • SWOT Analysis • SWOT Conclusion • Competitor Analysis • Market Assumptions • PART 2- Supply chain management and Business Financial Instruments
LEARNING OBJECTIVES • Participants will be able to make sound, logical and fact-based decisions regarding exports • Participants will be able to follow a sound methodology and use the tools for structuring and systemising their approaches to developing new markets or for expanding efforts in existing markets. • Participants will be able to develop their export strategy and plan as an integrated part, or extension, of their company’s business plan and for fully appropriating opportunities at the lowest possible cost
Several Exercises • Group work • Interactive • Need results as part of planning for Missions • What we do not finish • Homework • Email to firstname.lastname@example.org or email@example.com
Focus of Export Activities will be the FCORs FCORs Trinidad & Tobago Firms EXPORTS Supported by BDC Concepts can be applied to other markets
GENERAL INTRODUCTIONWhy Export? • Exporting can be a profitable way of expanding a business, spreading risks and reducing dependence on the local market. • Exporting exposes the company management to new ideas, management practices, marketing techniques, and ways of competing • Exporting can lead to increased efficiency and productivity of the firm • Global brands can be built from small local companies
Why Export to the FCORs Access to 27 EU countries with market of 0.5 billion people TT Firms FCORs High income market in Caribbean Supported by BDC
GENERAL INTRODUCTION (cont…)Important Ingredients for Export Success? • Exporting consumes time and money, and requires strong management commitment • To have a successful international business, you need a product or service which is in demand in overseas markets, as well as the necessary commitment, resources, skills and information to support sustained exporting activities over the longer term. • To achieve success, you need to have a plan and remain in control of your business, and not let the business control you
Export Cycle • The CBI Export Marketing Planner (A MANUAL ON HOW TO ENTER EUROPEAN MARKETS) identifies the following stages in the export cycle; 1 The Perception and Preparation stage 2 The Research Stage 3 The Strategy Stage 4 The Operational Management Stage We will focus mainly on 1 and 2 and after the Fact Finding Mission we will be in a better position to deal with 3 and 4
EXPORT CYCLE (cont…)GETTING READY TO EXPORT • When preparing for export, the first thing to do is to put things into perspective and to prepare an introduction that includes a short historic track record and a brief statement on your current position and performance Develop a Sense of Location Where are we???
Getting Ready to Export (cont….)Use 7 S’s Model to Develop Sense of Location McKinsey Model
GETTING READY TO EXPORT Cont... • After establishing your sense of location then you include the company’s mission statement, which is like a company charter. • The mission statement should summarise your company goals and your company’s strategy: where you want to go and how you want to get there. Develop a Sense of Direction FCORs Where are we going?? N W E S
Getting Ready to Export (cont….)Use 7 S’s Model to Develop Sense of Direction
Where are we in the process? Sense of Direction Sense of Location
Getting ready to export Cont….Current Market Position Meeting International Standards • Developing, producing & improving in accordance with international standards is essential to success in the international arena. • This will launch a process of continuous performance improvement that will help you make sure your company remains the ‘best performer, first choice’ for any buyer. For example, it may be advisable to embrace the philosophy of Total Quality Management (TQM) and to embed it in your organisation with ISO 9001:2008 certification. You may have to become HACCP compliant
Getting ready to exportCont….Current Market Position in terms of Meeting International Standards • Been there done that! FCORs Our Export Readiness Assessment suggests that most companies are meeting International Standards
Getting Ready to Export (Cont…)Current Market Position in terms of Marketing Mix?
Where are we in the process? Sense of Direction Sense of Location Current Market Position International Standards Marketing Mix (6 P’s)
Export Readiness Some key signs of export readiness • Significant management time and strong management commitment • Strength in the domestic market • The resources to succeed • Business and export planning in place
PART 1 • RESEARCH STAGE
THE RESEARCH STAGE THE RESEARCH STAGE COVERS THE FOLLOWING ASPECTS OF THE EXPORT PLANNING CYCLE; • MARKET AND INDUSTRY TRENDS • EXPORT AUDIT (COMPANY AUDIT; MARKET AUDIT; SWOT ; COMPETITOR ANALYSIS ) • MARKET ASSUMPTIONS
Market and Industry TrendsWhat is a Market? • Before identifying potential markets, we need to understand what a market is. • Simple definition: “A market is a group of people with similar needs, with money to spend and the willingness to spend that money to satisfy these needs”. • Early identification of trend changes in your target markets will enable you to embrace the new trends, adapt your products accordingly and adjust your value chain. • The supplier who acts fastest is most likely to see his market share grow
Market and industry trendsMarket Research • Market research should not be an academic exercise of assembled facts and figures. Good market research entails finding out what actually drives a market – and how to get the best out of it. • Market research involves finding out about things you need to know such as import duties, regulations, distribution channels, market size and growth, competition, demographics and local production – so you can assess market opportunities and the costs of capturing them
Market and industry trends Cont.... • The first step is to gather basic market information ranging from import regulations to exchange rates. This is available from free online sources. • Examine the market size and favourable import growth. • NOTE* • To single out first priority markets from among the 27 EU member states, make use of • the statistical tools of the International Trade Centre (ITC) (www.trademap.org) • the CBI’s Research Action Planner and • the CBI’s market information (www.cbi.eu ).
Market and industry trends Cont...Identify market trends using the 6 Ps • Product: Look for trends that influence the physical properties of your product. • Examples: colour, smell, sensorial properties, health properties, design & customisation, size, volume, weight, function, capacity, usage, convenience and packaging. • For cosmetics what smells do French like? • What size bottles? • How should packaging look? The French often feels that they are at the pinnacle of quality, fashion, style Our fact finding Mission will provide more insights
Market and industry trends Cont….Price • Price: You may notice trends towards the low end of the market or, reversely, the high end of the market etc. • Which end of the market do you want to come in • Do you just want to come in some where in between • Depends on many factors • Where company wants to position itself • Number of substitute products • Income level of target market • Tastes and preference • Costs Price Quantity
Market and industry trends Cont….Place • Place trends may include • The trend towards a shorter or longer distribution chain, or towards a different or completely new distribution chain. • In-chain availability or a certain lead-time if you’re producing on order may also be a trend. • The adjustment of delivery times, upward or downward, may also be a trend. • Other place-related trends include the rise of e-commerce, e-markets.
Market and industry trends Cont….Promotion • Note the shifts in • communication tools • Brands • Images • Target groups • Product branding to company branding
Market and industry trends Cont….People • People: • Ageing societies and the trend towards health & nutrition claims are typical people-related developments • Transparent responsibility & accountability • Corporate social responsibility (CSR) and • The growing market share of fair trade products.
Market and industry trends Cont….Planet • Planet-related trends have to do with issues like • Natural origins & linkage • Energy efficiency & economy • Recyclability • Sponsorships • Environmental management and investment. • Sustainability and accountability are also key trends
Market and industry trends Cont…. • Next you can consider variables like: • Favourable trade relations (EPA) • Historical, cultural or geographic characteristics • Affinity and proximity(much closer than mainland France) • Market characteristics (high income) • Supply chain characteristics (are distributors available) • Economic, political and technological developments • Competitor activity • Fashion • Innovation • Market access regulations (EPA) • Consumer preferences Read and learn as much as possible about these factors in the FCORs
Checklist for market and industry trends • Develop a short list of markets and create a structured search outline. • Search deeper than the basic facts and figures. • Gain a feel for the environment and trends operating in the market of interest to you. • Seek out practical advice at market-specific seminars. • Gather basic information from the Internet. • Develop direct contacts with potential buyers. • Check out online reports that are available from various sources
What Do We Know About The FCORs? • What does FCORs mean? • Where are FCORs? • What are countries in FCORs? • What is the capital of each FCOR? • What language is spoken in the FCORs? • Who is the President of the people of the FCORs? • What is the population of each of the FCORs? • What is the demographic breakdown of the FCORs? • What is the dominant culture of the FCORs? • Do the people consider themselves to be French or Caribbean? • What kind of music do they like in the FCORs?
What Do We Know About The FCORs? • What is the GDP per capita of each FCOR? • What are the main products of the FCORs? • What are main exports of the FCOR? • What are main imports of FCOR? • What shipping lines go to the FCORs from TT? • What are visa requirements for entering FCORs? • What are duties when exporting to FCORs? • Which TT companies are exporting to the FCORs?
Main Exports and Industries Martinique Guadeloupe French Guiana
Distances to FCORs Martinique Guadeloupe French Guiana
TT Companies Exporting to Martinique MARITIME PRESERVATION LIMITED MEILING MESSER TRINIDAD & TOBAGO LTD NAT FLOUR MILLS LTD PCS NITROGEN TRINIDAD LIMITED PEPSI-COLA TRINIDAD BOTTLING PETROLEUM COMPANY OF T & T LTD PHOENIX PARK GAS PROCESSORS PIARCO AIR SERVICES LTD RADICAL DESIGNS LIMITED SOLOMON YUFE & CO LTD STUART BROTHERS (W I) LTD TASTE MAKER MANUF CO LTD TDAD AGGREGATE PRODUCTS LTD THE TEXTILE KING TRINIDAD & TOBAGO TIRES LIMITED WEST INDIAN TOBACCO CO LTD • ABRAHAM SHIPPING CO LTD • AG'S GARMENTS • ANGOSTURA BITTERS LTD • ASSOC BRANDS INDUSTRIES LTD • C G A LIMITED • CARIBBEAN BOTTLERS T & T LTD • CARIBBEAN DEVEL CO LTD • CARIBBEAN ISPAT LTD • CHAI'S EXOTICS • COLLEGE HEALTH FOODS • F A AGOSTINI ESTATES LTD • FORMULA I I I MARINE LIMITED • GENERAL PACKAGING LIMITED • HUMMINGBIRD GRAINS LTD • INDUSTRIAL GASES LTD • K C CONFECTIONERY LTD • KHAN'S ALUMINIUM PRODUCTS LTD
TT Companies Exporting to Guadeloupe PETROLEUM COMPANY OF T & T LTD PHOENIX PARK GAS PROCESSORS PRINT-A-PAK LIMITED PROTECTOR'S SECURITY SERV REGAL PRODUCTS LTD SKYLINE FREIGHT LTD SOLO BEVERAGES LIMITED SOLOMON YUFE & CO LTD TEXACO TDAD LUBE & SERVICE LTD THE TEXTILE KING THREE STAR SPORTSWEAR LTD • CARIB BREWERY LTD • CARIBBEAN DEVEL CO LTD • CARIBBEAN ISPAT LTD • COLLEGE HEALTH FOODS • ECHO MARINE LIMITED • GLOBAL M'KETING ENT CO LTD • INDUSTRIAL GASES LTD • JANOURAS FASHION HEADWEAR LTD • K C CONFECTIONERY LTD • MEILING • NAT FLOUR MILLS LTD • PEAKE INDUSTRIES LTD
TT Companies Exporting to French Guiana METHANOL HOLDINGS (TRINIDAD) LTD PETROLEUM COMPANY OF T & T LTD PHOENIX PARK GAS PROCESSORS ROTO PLASTICS TDAD LTD TASTE MAKER MANUF CO LTD TEXACO TDAD LUBE & SERVICE LTD THE TEXTILE KING • AGOSTINI INDUSTRIES LTD • ANSA MC AL LIMITED • CAMACHO BROS LTD • CARIBBEAN DEVEL CO LTD • D H L DATA FORMS • D S MAHARAJ FURN & APPL LTD • INDUSTRIAL GASES LTD
Where are we in the process? Sense of Direction Sense of Location Current Market Position International Standards Marketing Mix (6 P’s) Market and Industry Trends
EXPORT AUDIT • Following the market trend analysis, the next step involves the company audit
Export AuditWhat are two components? Company Audit In making your company audit, you will visualize & analyze the relevant internal elements that will impact on the outcome of your market research findings. A key characteristic of the company audit is that the elements covered are all controllable by your company management. (Export) Market Audit An external analysis of the Opportunities and Threats in your market. In conducting your market audit, you will visualize and analyze the relevant external elements that will impact on the outcome of all your research findings A key characteristic of the market audit is that the aspects covered are market conditions which are uncontrollable by your company management.
EXPORT AUDIT Contd. To conduct an export audit, we use the SWOT methodology, in which the Strength and Weakness analysis covers your company environment, while the Opportunities and Threats analysis covers your market environment. • In this stage, you are to describe the Strengths and Weaknesses of your company in relation to your expansion strategy. Identify the company strength and weaknesses on the basis of the 5Ms (see format): Men, Means (resources), Methods (management), Machines, and Measurables (marketing impact, customer and employee satisfaction, qualitative certifications).
SWOT Analysis - Diagram Helpful To achieving the Objective Harmful To achieving the Objective Strengths Weaknesses Internal Attributes of the Organisation Opportunities Threats External Attributes of the Environment