This is one of a series of articles looking at positive mindsets for a positive future. Over the last few weeks I have been exploring some of the most frequent questions I get asked as a business coach and focus on both the challenges and opportunities each one presents.
No-one starts their own business thinking it will be easy. There will be many challenges along the way. Very often the difference between business success and failure will depend entirely on how you approach those challenges and reframe them into opportunities.
Today my focus is another topic that leads to lots of questions and comments – exporting and import substitution.
We are nearing the end of this series of challenges and opportunities for SMEs. Many SMEs believe that exporting is beyond them – they see themselves as too small and believe that exporting is too complicated and challenging.
The main challenge when considering the possibilities of exporting is our own mindset – there are several Pacific wide organisations that are set up to support Pacific SMEs explore export markets in countries like New Zealand, Australia and China. Your local Chamber of Commerce, or your Export Association if you have one, will have the necessary contact details. Obviously, the decision to export is a big one and must not be made lightly. We need to understand the needs of the market we are planning to export to; be clear about rules and regulations; understand the competitive environment; be clear about issues like packaging, labelling, shipping, storage; understand the local economic and taxation situation. Don’t even consider an export market unless you have good contacts and reliable agents to act on your behalf and, preferably, you have been there and have a good understanding of how business is done.
Obviously at the moment there are many Covid related challenges but, if you are planning to reach out beyond your own country, then now is the time to think it through!
Collaborating with other small businesses might be a very good export strategy so you can combine strengths and opportunities. Most countries have opportunities for you to display your goods such as trade fairs or exhibitions. Ask your Chamber for contacts in the countries you are interested .
In the Pacific the tendency is to focus on exporting to New Zealand or Australia but don’t forget the rest of the Pacific – the markets may be small but they all need products and services that they do not produce themselves.
For many local SMEs there may be more opportunity in import substitution – simply identifying what your local community or economy imports from elsewhere and deciding to produce it yourselves. Look round you, look on the shelves of your local shops and begin to think about what you could make or produce. Why do we buy white rice from overseas when we have many other healthier substitutes grown here? Why do we import tins of coconut milk or coconut water when the South Pacific has many coconuts? Why do we sell eggs from battery chickens in New Zealand when we have perfectly good free-range chickens in our own communities? Why do we sell imitation handicrafts from overseas rather than our own authentic ones? Why do we throw away oversupply of fruit and vegetables in season without thinking about what else we could do in the way of preserving, adding value, drying, freezing?
Yes, it will take effort to establish an import substitution programme, but it will have a long-term economic benefit to the country and its local communities. Technologies exist today to allow for small scale production. Seek information from your Pacific neighbours and explore collaboration.
Get into the habit of asking questions – what else can we grow; what else can we make; what other services could we provide; what skills do we have access to that maybe are underused; what equipment and machinery do we have access to; what natural resources could we make better use of? Do not use Covid as an excuse for not being proactive – the pandemic will pass but, as an entrepreneur, you will need to continue onwards!
Over dependence on imported goods and services is not a good or sustainable economy strategy for any community. As business owners we need to think creatively for economic solutions that will not only benefit ourselves but all the people who are our potential customers.
If you need help with your own exporting or import substitution plans or you want some feedback on your own practices, then please get in touch.
I hope you have enjoyed this article. As always, please contact me if you have an interesting story to tell and are happy for it to be told. Watch out for the last article in this series next week.
Breadfruit Consulting (www.breadfruitconsulting.com) is a Vanuatu-based business providing advice, training, coaching, and mentoring to businesses throughout the Pacific islands. Breadfruit specialises in a range of business development activities including ‘business continuity planning and action’, helping businesses to survive in a crisis, designing and starting new, sustainable businesses. Contact email@example.com or firstname.lastname@example.org
Founding partner at Breadfruit Consulting.