Export potential refers to the likelihood that a company’s product or service is successful in selling abroad. Businesses usually identify the export potential of their products and services by analyzing:
Forecasting models are also used based on information like the export market’s economic outlook as well as current trade volumes and conditions. Analyzing these areas enables businesses to identify the strengths and weaknesses of their targeted overseas markets and to determine whether and why an export has the potential to succeed abroad.
For tools to analyze your export potential, see the United States International Trade Administration’s (U.S. ITA’s) web page on export potential, the United States Small Business Association Export Business Planner, and the Government of Canada’s Step-by-Step Guide to Exporting.
There are two practical ways to assess the export potential of companies’ products and services in overseas markets. First, if you are already selling successfully in your domestic market, finding an overseas market with similar characteristics is a way to target export sales. The second way is to assess the unique features that make your product or service different from those found abroad and therefore desirable in a foreign market. The U.S. ITA has created a useful export resource for small businesses called A Basic Guide to Exporting.
Online trade statistics provide an overview market picture of target countries. They can show if target countries are already importing the products or services that companies are intending to export. They also indicate countries sourcing imports and supply levels in target countries. One resource for identifying target markets is the European Commission’s guide for export of services. Google also offers a Market Finder website, video and FAQs.
The next step after identifying a target market is to find and connect with potential trade partners and business contacts. To do so, businesses can participate in trade fairs where buyers and sellers meet to explore business opportunities across sectors, research online to find potential markets, and use contacts or word of mouth. Attending events hosted by business support organizations that seek to explore export opportunities for domestic companies is another option. One resource from the U.S. ITA is their website on how to find buyers and partners. There is also an increasing number of online platforms that connect buyers and sellers. Beyond the well-known global e-commerce marketplaces like Alibaba and Amazon, a simple Internet search is often enough to identify specialized online marketplaces (see guide on selling abroad online). Google also provides a free course on Localisation Essentials to make services work for buyers around the world.