As a result, there’s never been a better time to look for partners beyond the shores of the EU. In fact, a recent OFX study showed that over a third of small British businesses plan to start or increase international trade in the next year, with the US, Australia and Hong Kong emerging as the top new markets to explore post-Brexit.
Here are some tips on how to enter each market for the first time.
The US: A special relationship
Much has been said about closer trade links between the UK and the US post-Brexit, so it’s no surprise that it emerged as the most popular new market for British SMEs, with 68 per cent naming it as an attractive future partner in the OFX study.
There’s some speculation that we may see a US interest rate hike before the end of the year, which would serve to strengthen the dollar. That should be music to the ears of British exporters, whose goods will become even more competitively-priced across the pond.
Build a currency strategy
When it comes to international trade, our top tip for any UK business is to have a strong currency strategy in place. By working with a currency partner, it’s possible to lock in an advantageous exchange rate – like a strong US dollar – for up to 12 months with a tool called a forward contract. It’s a great way to dodge uncertainty and know how much revenue you’ll be bringing home.
Find the right partner for your business
When planning for international payments, it’s best to seek out an expert provider to design a tailored currency strategy that flexes to the needs of your business. Look for one available 24/7 to answer questions and help you with your payments, no matter where you are in the world.
Australia: Opportunities down under
British exporters have a unique advantage in Australia, where the consumer market lags four to five years behind the UK, especially when it comes to e-commerce. It leaves a fantastic opportunity to be first-to-market or get a head-start on domestic competitors.
The long-awaited launch of Amazon in Australia is also paving the way for online sellers to easily enter the market. Fulfilment by Amazon will soon launch in Australia, allowing UK businesses to keep prices down for consumers by storing goods on the ground for cost-effective distribution.
Be a legal eagle
Like the US, Australia has a federal system, so some regulations vary by state. As a result, it’s worth double-checking local laws and regulations associated with your products or services. Do you need to update your product labels, amend Ts & Cs, or obtain additional certifications beforehand?
Seek out the experts
If these questions leave you stumped, it’s best to seek the help of a legal expert who can help you navigate local regulations. Before you do so, take a look at the latest guidance from the Department for International Trade – it’s a great place to start.
Hong Kong: A springboard to China
Hong Kong is an attractive destination for international trade in its own right. With an affluent, brand-conscious population and large expat communities, there is constant demand for luxury exports from “Brand Britain”. It’s also a stepping stone into China, thanks to the Closer Economic Partnership Agreement, which gives preferential access to the Chinese market.
Research your customers
While British goods are in hot demand, it’s important to note that consumer behaviours are vastly different to those in the UK. Before selling to Hong Kong, research your customers. Who are they, and what do they value? The results may be surprising, and could have a huge impact on your sales strategy.
How will you be noticed?
Once you know who you’re targeting, you need to work out how to sell to them. WeChat, a social media mobile application used widely in Asia, is an obvious place to start, and along with online marketplace Alibaba.
Jake Trask is FX research director at OFX, an international payments company with offices worldwide, including Sydney, San Francisco and Hong Kong.[rb_inline_related]