5 Questions You Must Answer before Selling Overseas

5 questions you must answer before selling overseas
Globalization has made the world smaller than ever. Even small businesses are looking into exports and international trade to increase their customer base and sales. Technological advances have made it easier to find and serve global customers even for small business owners. This traditionally used to be the purview of large, multinational companies.

While it is easy to set up online shop, deliver orders via UPS and collect money via Paypal there are more nuances to exporting and selling to international customers. You need to answer number of questions before you can embark on that journey. Will your product be subject to special regulation? How will you handle warranty and product returns? Who will collect and pay taxes to foreign countries? Failing to answer these and many other questions can put you in the hot water and impact your business.

Here are 5 questions you can begin with to understand export and international trade:


Does your product meet market needs?

This is the most fundamental question you need to answer. If there is no unmet demand that your product is going to fulfill you don’t even need to begin. A product might sell like hotcakes in the U.S., but it might fail in another country because it just doesn’t fit in that marketplace.

In some cases, your product may work well in part of the country, but not everywhere. For example, if you are selling technology based product that requires electricity, you might do well in urban areas but not so well in rural areas. Why? In some parts of the world – particularly underdeveloped countries – there is no established power grid that reaches out into the country.


Can your product be changed to meet the needs?

If demand doesn’t exist for your product at this time, don’t lose hope. You might be able to make modifications to it so that it will fit what customers are looking for. If, for example, your product requires electricity, and you are selling in an underdeveloped country, can you modify it so that it can run on batteries instead?


Are there foreign regulations that govern your product?

Don’t wait till you have orders backing up to research foreign country’s regulations regarding your product. Also, don’t just assume that regulations in other countries will be the same as in U.S. They most likely will not be. Take time to research applicable laws and regulations before you invest time and money. The last thing you want is to spend hundreds of thousands of dollars on a marketing campaign, and product distribution system, only to discover that you cannot sell your product due to government regulations.


How should the product be packaged?

It is important to also do research on the packaging of your products. Some colors, designs, and even packaging materials and methods that are common in the US may not work in other countries. The best way to figure out a good packaging scheme is to contact your international partners or conduct field research yourself.


How will you handle servicing and warranty?

In the U.S. handling warranty claims is relatively easy. When your customer lives overseas the complexity of handling warranty claim can multiply. Your customer will have to pay international shipping rates to return the product to you. Besides, some countries may have limitations or exclusions concerning warranties.

You don’t want to exclude certain services in your warranty only to find out a foreign country does not allow those exclusions. At the same time, you have to offer a warranty that puts your customers at ease while still being able to make enough money to cover your expenses.


William Lux is a longtime business advisor and teacher. Now retired, he enjoys blogging about what he has learned on the Internet. If you are looking for banding tools, he recommends you to visit the link.

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  1. BizSugar.com says:

    5 Questions You Must Answer before Selling Overseas

    Globalization has made it easier than ever to export products overseas. However, you must answer these 5 questions before jumping in to sell in foreign markets.