The majority of small and medium businesses in America are a bit insular in terms of the market they service, and less than 1% of the nation’s 26 million small businesses are exporters. By comparison, over 20% of small and medium enterprises in Britain are exporters.
For small businesses, the internet is a great leveler of the playing field. No longer do you need a local presence for manufacturing and distribution to service a foreign market. Third party logistics allow you to service the customer in India from your small warehouse in Georgia.
The internet has allowed a small San Francisco startup such as Airbnb, a company that provides a platform for short-term renters of apartments, to grow into a global business. Established in 2006, the company started by providing its service across America, but today it has users across 192 countries.
The customer is just a click away and companies can service them one at a time by using logistics to deliver their products across the world. However if your product is a service, then the internet is your distribution network and you’re in touch with your customer 24/7 via smartphone apps.
Start close to home
Small American companies can test the export waters by servicing neighboring countries such as Canada and Mexico. The two countries have well established consumer markets, a good infrastructure to tap into and the North American Free Trade Agreement removes most trade barriers. Once you feel you are ready to spread your wings, what are some of the emerging global markets that your company can tap into? Let’s take a look:
The acronym stands for Middle East and North Africa and is a loose confederation of about 20 countries, stretching from the Persian Gulf to northern Africa. The region has developed, oil producing countries like Kuwait, the UAE and Bahrain, and developing countries like Egypt and Jordan that have a large and growing middle class.
Kuwait and the UAE are real estate hotspots, thanks to investors such as Fahad Al-Rajaan. As chairman of the Wafra Investment board and Al Ahli United Bank, he has been responsible for investing billions of dollars in developing infrastructure and housing in the region. In his current role, he links companies across the globe to opportunities in the region. You can read more about him on his Facebook profile.
It is closer to home than the Asian markets, and countries like Columbia and Brazil continue to show growth. The region is home to a large middle class, 50 million strong, who have worked their way up income and social ladders. These markets are geographically focused and easy to reach.
Brazil, Russia, India, China and South Africa are home to 40% of the world’s population and 25% of the GDP. China and India between them will have a 300 million strong middle class by 2020. The fall in oil prices has slowed the Russian economy, but China and India continue to grow at over 7%, thanks to large domestic markets.
If a company has the time and cash to invest towards growth they should start by looking at the low-hanging fruits in the neighboring markets as they make plans to tap markets further afield. If you’re not already doing this now, just know that your competitors probably are!