10 most frequent errors when exporting from Spain

10 most frequent errors when exporting overseas

10 most frequent errors when exporting overseasExport has been boosting the Spanish economy. It has achieved an year-on-year increase of more than 8% within the first months of 2013. Due to the decrease of the internal demand, several Spanish Small Business are starting to expand their business offshore, either selling its products or services. Nevertheless, expanding to foreign countries is a complex process and a huge amount of companies fail in their attempt because they undervalue certain relevant aspects of internationalization.

Many companies have set up some international wealth over time, those belong to the financial, building and food and agriculture sectors. Nonetheless, others sectors have barely started their way to internationalization. It must be born in mind that despite each company has built its own organization in relation to its business rules, Sixto Rodrigo, Deustche Bank Enterprise Segment Director, has found several error patterns which appear repeatedly. Which are as follows:

1. Inefficient intern organization for exports. It is very common that companies make profit in their own country, and due to this, they think they will work offshore. Nothing could be further from the truth, exporting offshore needs investigations and research made by qualified people, i.e., people working in the field of exports. If that person doesn’t work in our company, it’d be better to hire someone.

2. Misidentification of the new market. Research on the specific characteristics of the target market must always be done, as well as research on the social and cultural customs of the new clients we’re trying to sell our products and services.

3. Inability to adapt your business to the foreign market. In many occasions, companies can’t introduce their products in foreign markets. Low demand or luxury products in other countries, can be considered everyday items in Spain. That’s why research on other markets is necessary. It this way, we could understand how to adjust the product name, price, distribution and presentation to the new market.

4. Success is not moved from one market to another. Many times, businesses in foreign countries fail because we try to move the same organization from one country to another. Notwithstanding, never let your guard down. It is very important to keep in mind that the economy and culture of every country is not alike, but mark the difference. These are key aspects when trying to introduce your business in other countries.

5. Logistics and cargo transport. When internationalizing our products, we must look for the most efficient way of transport and take into account certain aspects such as customs, duties, and changes in cargo, which can occur in air or maritime transport. Other fundamental aspect is transport insurance. It ensure us to covered in case of the cargo is damaged or lost.

6. Errors in documentation. Many of the problems when delivering cargo take place at customs. Being rigorous is essential when issuing delivery notes and invoices. To avoid the delay of deliveries, certain decisive aspects must be born in mind (such as adding VAT in exports out of the euro zone, Andorra, Norway, and Switzerland).

7. Licenses and permits. Delays in deliveries can occur if we have not considered customs or export licenses, which some products require. To ensure a successful process, we need to be sure that our distributors, to whom we are associated, have the current permits and licenses to take our product to the target market.

8. Currency exchange. Many companies do not consider this aspect as important, but it is essential, actually. When working with different markets, given that currencies have a variable value, a risk of exchange exists. This risk increases because forex markets are highly volatile, and, according to experts in this field, it will keep on being volatile for a long time. Many companies have options on currency and assurances of the exchange rate to safeguard themselves from this risk. These two products allows us not to loose profit when selling items offshore.

9. Prices poorly established. There exist certain aspects that, if we don’t take them into account, can make the balance sheet of a company to be affected. They are: wrong calculation of shipping costs when assigning the prices to the products in the target country, and implicit costs (distributors, logistics, transport, duties, and so on). To make profit of our projects, we must accomplish price comparisons, research of the target market, as well as we need to take part in the additional costs.

10. Languages. When we are trying to introduce ourselves in other markets, it is fundamental to know their language. We need to make sure that we count on experienced interpreters in each of the steps of our project, from increasing our list of local customers to writing and revising guarantees and contracts.

by Manuel Gallego

Manuel Gallego founded Spainbox in 2009 with the mission of helping other companies to optimize their shipments in Europe. I am developer and have implemented a free proprietary warehouse management software that is completely tailored to Spainbox processes, named Shipeu Fully integrated with most popular Ecommerce platforms and marketplaces like Shopify, Woocommerce, Magento, Prestashop, Amazon, ebay, etc. Include inventory control, tracking orders, label printing with couriers integration. UPS, Fedex, DPD, Correos express etc. Shipeu manage our services of Amazon FBA prep. Another important software we have is Spainbox forwarding that help us to manage to forward all purchases in Europe of our international customers.