Export businesses are reporting more revenue or profit growth than companies that trade domestically, a survey has found,
Workspace provider Regus said that for the third year running exporters have topped domestic traders, with the former recording an average profit increase of 48 per cent over the past 12 months compared to a 36 per cent increase for domestic traders.
While reaching out to a larger pool of prospects plays a part in exporters’ success, the survey also confirms that having a presence in the same country as your clients carries a number of benefits.
Specifically, 98 per cent of businesses say that they can deal more effectively with customer problems by being physically near them.
Being close to clients also means businesses can increase their understanding of customers and markets (94 per cent of respondents said that) and improve customer satisfaction (90 per cent).
But foreign expansion is a big step for businesses to take and a difficult one if support is lacking.
In particular, businesses say that aside from making customer introductions, their government trade delegations can help them expand abroad by providing advice on legal and regulatory matters, according to 66 per cent of respondents.
Other findings from the survey are:
– Being close to customers means businesses can improve customer retention rates (90 per cent).
– 81 per cent of companies say a location close to their customers can boost sales and improve marketing effectiveness (75 per cent).
– Government introductions to local business organisations and associations (39 per cent) and advice on taxation (66 per cent) would help businesses plan for foreign expansion.
– Almost a third of businesses (28 per cent) would benefit from a directory of places to network.
John Henderson, regional director of Regus Asia Pacific, said: “People always talk about ‘getting close to the customer’, but in export markets that can be literally true.
“Our survey respondents told us that having a physical presence close to their customers brings about a number of benefits. In particular, businesses report that better customer retention, faster problem resolution and greater satisfaction can be achieved by setting up a location in proximity to their customers or clients.”
However Henderson warned that setting up a presence abroad was a challenging task if you didn’t have the right support from your government.
He said businesses globally reported that the best help they could expect from their government trade delegation when expanding – aside from client introductions – is getting legal and regulatory advice, taxation and local custom information and tips on where to network and meet local businesses.
“Where this information is not made available or is incomplete, businesses would do best to partner with firms that understand the world of business and can provide local know-how and connections,” he said.