Varying relevance of exports
Is the export business more likely to be managed and operated on an operational level? This can be based on a wide variety of considerations. It is possible that time and budget resources are currently lacking, that your company's overseas offering is difficult to scale, or that the competitive advantage of your offer on international markets does not seem to be secured or that the executive committee’s priorities are currently different.
“Rejecting a risk is the biggest risk for a company.” Reinhard Mohn, German entrepreneur (Bertelsmann)
Export despite limited resources
In such cases it can be worthwhile to develop a traditional direct export model (selective customer processing abroad, sales from Switzerland) and to operate it with manageable effort. As your ambitions for future business abroad increase, the time will come to address the appropriate directions, means and objectives on a strategic level.
The leadership team should be on board
International activities always tie up a certain amount of time and financial resources. Success is helped when the company’s entire management team is familiar with larger projects, supports them and manages them in unison. The corporate culture as well as the attitude and the expectations of individuals in the executive committee decisively influence the procedure and also the company’s expected success abroad.
Experience, corporate culture and chances of success
As a rule, an executive committee experienced in foreign business will be more proactive than an entrepreneur who has so far been strongly focused on Switzerland and who wants to move forward step by step with caution. An SME that recognizes big market opportunities for its products and services on an international scale will be more proactive than a company that has to take the first step into foreign markets under pressure from its main customers. There is no “right” or “wrong” here, but rather entrepreneurial realities that must be taken into account.
Defensive growth model: Play it safe
The medium-term expectations for sales growth abroad are often rather cautious when Swiss SMEs enter the market. Conservative growth expectations are also accompanied by a more defensive willingness to invest. This is partly due to the nature of Swiss business culture, but it can also be based on company-specific considerations. It is possible that the overseas offering is not easily scalable or the time and budgetary resources are currently limited, the competitive advantage of the offering on international markets is not yet secured or there are other uncertainties with regard to the market or partners abroad.
The strategic integration of foreign activities influences investment and earnings
In any case, it is still important that the willingness to invest meets the requirements of the market. Under what circumstances are your international customers prepared to consider suppliers abroad? What are the expectations of your local presence and services? What support does your local business partner need to be successful? What is the minimum annual investment in communication and marketing required to achieve a measurable impact?
Beware of overambitious expectations
In some cases, the company's expectations of new business abroad have rightly been rather ambitious from the outset. There are possibly already-existing customer relations abroad, the offering provides a much sought after added value, a highly suitable partner has been found and the first sales and experiences show that some growth on international soil is still possible. In these cases, more progressive growth planning can be considered. In most cases, a scalable approach with step-by-step development and expansion of activities and experience is advantageous.
Initial recommendations for action
- Ensure that the willingness to invest meets market requirements. Even with a defensive growth strategy, international market development always requires a minimum willingness to invest, usually over several years.
A business plan for your internationalization project is a useful basis for discussing and coordinating the procedure – internally as well as with external partners (e.g. banks).
Derive pilot projects from the business plan with the aim of validating the assumptions made for the foreign market before you make any major necessary decisions.
- Apply agile market development techniques (“testing the water”) by testing and learning directly in the market within the framework of limited pilot projects with manageable effort.
You’ve decided to start exporting, but how will it work with limited resources? Small and medium-sized teams in particular often lack resources. Read here about how you can organize your team in the first few months: Smart resource planning: How must we prepare our team?
Use our compact “Export Compact” handbook to keep track of things when you start exporting. Download it and get useful tips and tricks for getting started with internationalization. To the “Export Compact” handbook