12 STEPS TO SUCCESSFUL EXPORTING
ZimTrade has prepared this simple Exporting in 12 Steps Guide for the benefit of Zimbabwean exporters and would-be exporters.
Click a step to expand it
ASSESSING YOUR EXPORT READINESS
Prior to embarking on your export journey in a sustainable way, it is important that you understand your state of readiness in respect of your enterprise, your products/services and yourself as an entrepreneur.
We advise you to do a quick self-diagnosis survey by answering a few simple questions.
After you have completed the self-assessment survey, an officer of ZimTrade will contact you to guide you on the way forward.
Check for our export development initiatives which aim at building the capacity of exporters and potential exporters on building and strengthening your export readiness.
NOTE: We wish to assure you that all information provided will be kept confidential and will be used only by ZimTrade.
SELECTING YOUR EXPORT MARKET
You may have a legitimate wish to supply your products/services to the world markets. However, to be present in all or many markets you must first succeed in one market. This can be a neighbouring country of your Regional Economic Community (COMESA/SADC) or an overseas market in the European Union, North America, Middle East, Asia, amongst other markets.
It is advisable to focus your resources in successfully and sustainably penetrating one export market, prior to expanding your market outreach to other countries.
ZimTrade will be present, all the way, to provide you hand-holding assistance in your export journey.
We advise you to select a high potential and low-risk market which is most suitable for your products/services. This can be a small market, a country or a city within a country. In either case, you need to know your targeted market in great detail, through structured market research so as to minimise risks and costs of venturing into the new market.
Caution: Avoid making assumptions
Each market has its own specifications. You will need to adapt your product to suit the requirements of the target market(s).
A GUIDE TO SELECTING A MARKET FOR YOUR PRODUCT/SERVICE
This guide will help you explore all the critical avenues and issues you should know about a market before entering the market. Some of these critical issues that need careful investigation are:
- TRADE POLICIES
You should know the market access conditions that govern trade between Zimbabwe and the target market in terms of existing trade agreements (bilateral, regional or multilateral) and the benefits thereof. These could be trade agreements offering preferential treatment (Preferential Trade Agreement), duty free treatment (Free Trade Agreement), defined benefits under the Generalised System of Preferences (GSP), or Most Favoured Nation (MFN) treatment, under WTO rules. These agreements offer varying degrees of preferential market access to Zimbabwean products/services in terms of duty and quota treatments. Click here for Trade Agreements of Zimbabwe.
- COUNTRY FEATURES
Gather information on the geography of the country, where it is located, how to access it, its main cities and towns, level of urbanisation and vital statistics on the country’s demography, namely population size, make-up, per-capita income, spending power and patterns.
To get updated facts and figures about the target market, visit the website of the country’s National Statistics Office, for example ZimStat.
- BUSINESS ENVIRONMENT
Information on the country’s Political, Economic, Social, Technological, Legal and Environment (PESTLE) framework is critical in deciding your level of engagement in the market. We strongly advise that you conduct research on the above variables and understand possible implications on your proposed export business. There are many sources of information on the business conditions of a country, some of which are: World Bank Publications, IMF Reports, CIA World FactBook, specialized magazines, academic papers and several online search engines.
- BUSINESS CULTURE
It is vital that you understand the target country’s business practices in terms of language, culture, values and business ethics. We advise you to familiarise yourself with these values, ethics and cultural aspects of doing business.
- DEMAND CONDITIONS
To estimate the potential of the target market for your product/service you should understand market size, possible growth. You should also understand how the market is currently serviced, either from the domestic supply or from imports.
- KNOW YOUR COMPETITORS
You should carefully investigate all sources of competition in the target market, be it local or international and their respective markets. Additional information can be obtained from ITC-Trade Map.
- REGULATORY FRAMEWORK
Each country and Regional Economic Community has its own regulations on compliance issues such as health and safety, labour laws, social, environmental and product standards.
- DISTRIBUTION CHANNELS
You must know who the main players in the target market are, what share of market they hold and how the distribution channel is organised. Such knowledge will assist you to plan your market entry.
- TRADE LOGISTICS
You must investigate all the logistics available or required to successfully do business in the target market in terms of air/sea connections, internal transport, freight rates, documentations and travel & visa requirements.
- RISK FACTORS
Apart from knowing the opportunities that the target market offers, you should also explore the risk factors and challenges of doing business in the market.
Caution: All information gathered through your research will assist you to prepare your marketing strategy.
However, it is always advisable to visit the country to confirm your findings prior to signing any contracts or making your first shipment.
ZimTrade has prepared a Market Research Template and a Guide to Market Research to help you conduct your own market research on your target market(s).
DEVELOPING YOUR EXPORT MARKETING PLAN
After completing your analysis of internal factors (assessing your export readiness) and external review (investigation of the target market with regards to opportunities, challenges, competition, logistics and risks) you should be able to establish a Unique Selling Proposition (USP) of your product/service in the target market. Your Plan must cover the following:
- Your USP (price, features, quality, customer service, brand and technology)
- The target market (including sub-market)
- The distribution channel (agents, distributor, retailer, direct to end-user)
- The product pricing
- A competitors’ analysis
- The promotion strategy
- The logistics (freight forwarder, customs broker, shipping lines, airlines)
- The after sales care and support facilities
- The resources required (budget and personnel)
- Risks and mitigating factors
ZimTrade has prepared a template to enable you complete your Export Marketing Business Plan.
ENTERING YOUR SELECTED MARKET
Your market research and your export business marketing plan will help you choose your market entry strategy. Your decision will have a direct bearing on the results. You may choose any of the following Market Entry Strategy:
- Direct Exports (B2B) – selling direct to the retailer or chain stores
- Indirect Exports – selling to a distributor, wholesaler or middleman, who will handle the distribution in the target market
- Franchising, where a Zimbabwean exporter gives an importer the right to use his/her business model and brand for exploitation in a specific market for a prescribed period. A Zimbabwean exporter can thus create a network of independent retailers in different cities/towns in a target market. The exporter will earn a fee or royalty from his/her franchisees.
- Licensing, whereby a Zimbabwean exporter can lease a legally protected entity (his name, logo, trademark, graphic design, slogan or a combination of these elements) to a businessman in the target market to exploit all opportunities
- Setting up your own subsidiaries in the target market.
- This can be either:
1/ Acquiring an existing business (Merger and Acquisition), or
|CAUTION: Before venturing into any new market through this mode, you should understand the investment climate with regard to ownership and control, travel and residency rights, foreign exchange regulations, investment protection, enforcement of contract, and other country risks.|
2/ set-up a new business in the target market
- Joint-venture collaboration, whereby you can join hands with an existing business or a potential entrepreneur to set-up market outlets in the target market.
VISITING THE TARGET MARKET
Whichever mode of market entry you select, it is always advisable to visit the market to see for yourself the opportunities it offers to your products or services, identify the competitors and challenges, and select which client you would wish to do business with, the more so if you have to sign a contract/agreement.
|NOTE: In some cases, the buyer may visit your factory before placing an order to see your facility, your compliance to the buyer’s Standards and Norms, and to select any designs you may offer. Always prepare and plan for such visits. Be careful of unannounced visits.|
PLANNING YOUR BUSINESS TRIP
It is important that you carefully plan your business trip to optimise the benefits in meeting potential buyers, visit the key Trade Support Institutions (TSIs), most importantly the local Chamber of Commerce and Industry, the Trade Promotion Agency, and any Government agencies that can be useful, among other parties.
You should make a check-list of things to do prior to and during your visit.
CAUTION: Always ensure that you undertake appropriate follow-up actions after your visit in terms of ‘thank-you note”, provide any materials/samples or information you have promised, and plan for next meeting)
PARTICIPATING IN A TRADE FAIR/EXHIBITION
Trade fairs or exhibitions are very important meeting points between buyers and sellers. It is always advisable to visit a trade fair to see the products being show-cased and to understand the needs and requirements of the buyers. ZimTrade organises the participation of Zimbabwe in leading trade fairs in selected countries. If your company is invited to participate in any such event in the Zimbabwe Pavilion, you should ensure that you are well prepared to make the best of your participation. This requires careful planning. ZimTrade will provide necessary information and arrange logistics for your samples. Always make your own check list on participation in trade fairs/exhibitions.
You may use our proposed Check-list
|Check-List: Participation in Trade Fairs
☐ Ensure you have made all the necessary arrangements as per check-list: Business Trip
☐ Click here for check-list on participation in Trade Fairs/Exhibitions.
E-Marketing is steadily growing in importance in international trade primarily due to easy accessibility to internet and fast expanding technology, of which mobile application is one that is connecting people in the remotest areas. E-marketing is extremely cost effective and a powerful marketing tool available to SMEs.
CAUTION: Prior to embarking on e-marketing ensure that you have all the relevant information on your product, including photographs and you have a database of potential buyers. You may wish to buy a database to start with. However, the most effective method is to have e-mail sign-up box on your website and through referrals. Observe the confidentiality condition. DO NOT SELL OR PASS ON YOUR SUBCRIBER DETAILS TO ANYONE.
When entering into a new market, you should have appropriate marketing materials in different formats i.e. print and digital versions to make your products/services known to the potential business partners and customers in the target market.
- The printed version could be: brochures, leaflets, banners, posters, press kits, annual reports
- The audio/visual support can be short promotional films or clips
- The digital marketing tools include websites and Social media accounts
|NOTE: In this digital world, every exporter should have a website to promote his/her products, services and company. Consult with Zimtrade to have you organisation listed on the Trade Information Portal.|
Whether you are a small, medium or large company, once you enter into international business it is important that you build a reputation for yourself, your company and your products/services. The reputation or impression you create becomes your brand identity.
Your brand is more than just your logo and tag line. In fact, it is the way customers see your products or services and your company.
As an Exporter you must always deliver on your promise at all times. Your brand tells your target audience why you are better than your competitors.
CAUTION: Always consult a brand-expert before embarking on a large scale branding exercise.
Once you have a brand identity, you must have adequate resources to manage your brand. Make use of the local press, and your social media.
CAUTION: NEVER PROMISE WHAT YOU CANNOT DELIVER!
UNDERSTANDING EXPORT LOGISTICS
Zimbabwe is a land-locked country, and as such all its export cargo must either be air-lifted or shipped through a third-country port.
Exporters must understand the principles of both air and sea cargo. You must know the players engaged in providing the right logistics services and more importantly know the rates for air and sea cargo. For sea cargo, you must also understand multi-modal transport, that is train and road transport to connect to your preferred port. For cross-border trade with the region, you should know the road and rail transport services.
|REMEMBER: Always consult more than one service provider and always negotiate the best rates.|
- SERVICE PROVIDERS
To effectively succeed in doing international business you should know a good licensed customs broker and freight forwarder. These professionals will assist, in selecting the most economical route and price as well as in choosing the most reliable shipping line/agent.
- FINDING A FREIGHT FORWARDER
To obtain a list of customs brokers, cargo agents and freight forwarders in Zimbabwe, contact
You can make an on-line request to find a Freight forwarder and even get a freight quote on:
- cargoyellowpages.com/zimbabwe-freight-forwarders-cargo-agents – Zimbabwe Cargo Agents
- ziffa.org – The Zimbabwe Indigenous Freight Forwarders Association (ZIFFA).
- speciss.co.zw – The Shipping and Forwarding Agent’s Association of Zimbabwe (SFAAZ)
The set of documents used in international business are different from those used in domestic trade. It is important for an exporter to know these documents and their uses so as to avoid unnecessary delays in shipment and payments.
REMEMBER: Importers assume that the exporter knows his/her business and is capable of completing all the formalities of exporting.
All export transactions are based on a contract between the buyer (importer) and the seller (exporter). It is vital that you check every clause of the contract carefully. Any errors or omissions can be costly and even lead to cancellation of orders.
A contract will clearly stipulate the following:
- Detailed specification of the goods
- Quantity being ordered
- Agreed prices
- Packaging and labelling instructions
- Conditions of carriage (air, sea and destination)
- Dates of shipment
- Modes of payments
- Dispute settlement (arbitration, court of jurisdiction)
You should also familiarise yourself with the terms used in international business to avoid misunderstandings. The universally accepted set of International Commerce Terms, commonly known as known as INCOTERMS, governs trade between nations.
Click here for commonly used Incoterms
You should also know the correct description of the products, which are classified into customs tariff item numbers, also known as the Harmonized System Code or more commonly as H.S Code.
Click here for the H.S codes
Commercial Invoice is an important document for international business to happen. It is used as a customs declaration document provided by the exporter for customs control, valuation and determination of duty and taxes.
This document identifies the product being shipped and contains the following information:
- Complete name and address information of both the exporter (shipper) and the importer (consignee), including telephone, fax and e-mail addresses.
- Complete description of the product and its H.S code
- Terms of sales (Incoterms)
- Country of origin (where manufactured)
- Quantity being exported, with unit value and total value
- Number of packages and total weight
- Exporter’s/shipper’s signature and date
NOTE: A nominal or fair market value must be stated for items of no commercial value (samples, gifts) for customs purposes.
Click here for a sample of a Commercial Invoice
BILL OF LADING
The Bill of Lading (B/L) is a document of title issued by or for the shipping company (the carrier) which provides the details of the goods being carried and the terms of shipment, giving title of that shipment to a consignee, who needs to surrender a negotiable copy of the B/L to take possession of the merchandise. Bill of lading is one of the most important documents in the shipping process.
Click here for a sample of a Bill of Lading
NOTE: When a cargo is sent by air, an Airway Bill (AWB) is used.
CERTIFICATE OF ORIGIN
The Certificate of Origin, also known as movement of goods certificate, is an important international trade document attesting the origin of the goods being shipped.
There are two (2) types of Certificates of Origin (COO):
- Preferential Certificate of Origin, which enables products to enjoy privileged market access in term of tariffs reduction or tariffs exemption when exported to countries under preferential agreement (PTA & FTA) provided the Rules of Origin criteria are satisfied, i.e the goods are either wholly obtained or sufficiently processed/transformed in the country claiming the certificate of origin. These can be the E.U.R 1/EPA certificate for exports to the E.U, the COMESA Certificate of Origin, the SADC Certificate of origin.
IMPORTANT NOTE: Exporters must know the trading policies governing trade between Zimbabwe and the target market and more importantly, you must know the Rules of Origin (ROO) criteria. For additional information and guidance, exporters must check with ZIMRA for the official status and conditions
- Please find below samples of different types of Certificate of Origin required for exporting from Zimbabwe. These documents are on sale at ZimTrade at a nominal fee. Non-Preferential Certificate of Origin also known as ordinary Certificate of origin which certify that the country of origin of a particular product does not qualify for any preferential treatment.
Contract ZimTrade or ZIMRA or your freight forwarder for more details about these certificates of origin and the rules of origin.
LETTER OF CREDIT
The Letter of Credit (LC), is a document issued by a bank and represents a guarantee of payment by the person receiving the goods (the importer) to the exporter up to the amount stated on the letter of credit, provided all delivery conditions mentioned on the LC are satisfied. In order to receive payment, the exporter will need to produce the LC together with stipulated documents including the invoice, the bill of lading and insurance policy certificates.
CAUTION: Exporters using LC, for exports must pay attention to the conditions and terms of delivery stated on the LC. Non-compliance to any item thereon can result in the bank refusing to make payment.
An Insurance Policy or Certificate is required for every export sale. However, who provides the insurance cover – the Exporter or the Importer, depends on the terms of the contract (INCOTERMS).
CAUTION: Exporters should be mindful of the costs of insurance in its pricing strategy. Goods can be shipped Free on Board or Costs & Freight when the importer bears the insurance costs, or on a Cost, Insurance and Freight basis where the exporter meets the insurance costs. For more information on export insurance, please contact your insurance agent or your freight forwarder.
Phytosanitary Certificate must accompany all shipment of fresh plants, vegetables and products thereof. This certificate confirms that the products have been inspected by the authorised agency and are free from harmful pests and plant diseases. This certificate is issued by the Ministry of Agriculture.
Financing Your Export Operations
Access to credit and finance is always a challenge, especially when finance international business where the seller and buyer are in different countries. The most common form of credit or finance remains, Banking in term of loans or overdrafts. However, the former is always against collateral and the latter on the company’s track record.
SMEs and first-time exporters have difficulties in accessing bank finance for exports. Most commercial banks do provide trade finance in terms of revolving lines of credit for working capital, or through Factoring and Bill Discounting if the export is against irrevocable Letter of Credit.
All bank services have a cost element in terms of service fees, interest and collateral. Consult your banker on the services they offer for trade finance and the costs thereof.
While the exporter wishes to have quick payment for his/her products/services exported, the importer on the other hand will always wish to delay payment. Due to fierce competition on the export market, unfortunately most exporters offer flexible and longer credit terms to retain their international clients.
Two alternate payment terms are:
- Cash-in-Advance – whereby the importer sends full or partial payment to the exporter on the promise that the product/service will be delivered on time as per specifications.
NOTE: All the risk rests with the buyer/importer
- Selling-on-open account – whereby the exporter ships the product to the importer on a promise to be paid at a specific time or as per the agreement.
NOTE: All the risk rests with the Exporter
EXPORT CREDIT INSURANCE
To protect the exporter from payment defaults by the importer, it is advisable the exporter protects their foreign receivables against non-payment risk. This can be in the form of an Export Credit Insurance Policy.
DEALING WITH THE LEGAL SIDES OF EXPORT
You should be aware of legal issues relating to international trade. These can be:
- Enforcement of Contract
Read and understand every clause of any contract you sign with a buyer from another country. Check the enforcement, dispute resolution clause and which Court has the precedence.
- Trade Policies
Always follow developments on issues governing trade with the target country. These can be bilateral, regional and multilateral. They define the market access conditions for your products and services.
- Intellectual Property Rights
As an exporter you should always protect your intellectual property rights in the territories you are doing business in. Check the IP legislation and consult the IP Office.
- Sanctions and Prohibitions
Most countries have a restricted list of products which are prohibited for health, national security, moral and environmental reasons. Some countrys have travel sanctions to high risk-areas.
Avoided dealing with persons or organisations connected with terrorist activities.
- Fraud and Corruption
Fraud and corruption are crimes punishable by law under defined statutes. Know these laws and avoid getting involved in any such activity.
UNDERSTANDING EXPORT RISKS
Every exporter must be aware of the challenges and risks in selling his/her products and services to other countries. These risks can be:
- Political risk
As an exporter you may face risks of political instability in your export market, which can disrupt and even break your business. This can lead to default on payment, introduction of foreign exchange controls, seizure of property and assets and change in trade policies among others.
- Legal risk
You need to understand the differences in laws and regulations prior to engaging with your export market. Investigate the provisions on enforce-ability, disputes resolution, arbitration, protection of property and Intellectual Property Rights, employment, health and safety laws, as well as the court system.
NOTE: Most of West African countries follow (Code Napoleon) French law.
- Corruption Risk
Be mindful of legislation on corruption in the country you wish to export to.
- Compliance Risk
All countries have some form of restriction on imports of goods and services based on established compliance standards and norms relating to:
- Labour laws – Against exploitation of slavery and child labour
- Health and safety – In support of good and safe working conditions
- For export of fresh produce, you will require a valid phytosanitary certificate
- For export of live animals, you need to know the quarantine laws
- National Security – Some products are prohibited for national security purpose
- Moral Issues – Products which can affect morality and may disturb peace
- Standard Compliance – Most countries have strict standard compliance codes on selected products
- Environment Compliance – More countries and buyers are introducing stringent compliance standards for sustainable development, in terms of environmentaly friendly products.
- Exchange Rate Risk
Exchange rate is a vital component of international business, you should follow the trend on the prevailing exchange rate of the currency in which you are denominating your exports. Any mistake in foreign currency pricing can be detrimental to your business, either eroding your profit margin or causing loss.
You can protect yourself against exchange rate risks by quoting your prices in USD and by hedging against currency fluctuations.
CAUTION: Always contact your bank for advice on currency pricing and how you can protect yourself against foreign exchange risks
- Non-Payment Risk
It is important to select reliable trading partners. However, the risk of non-payment if you are using an Open-account policy is always present. It is advisable to use more secured Payment Terms such as Cash-in-advance or Irrevocable Letter of Credit.
CAUTION: Be careful in offering extended credit terms, especially to new clients. You can protect yourself against non-payment risk by taking appropriate Export Credit Insurance cover.
|Check-list for Managing Export Risks|
ACQUIRE CUSTOMER LOYALTY
Build customer loyalty from your first order. You need to establish long term and sustainable business relationships with your client(s) so that they keep coming back to you.
Tips to building Customer loyalty
1. Always deliver on your promise.
2. Always communicate with your client(s).
3. Provide good customer service and after care. If possible always deal with your key customers personally, or designate someone senior in your company to deal with them.
4. Build and strengthen your company’s capacity through regular training of your personnel.
5. Provide customised incentives to your reliable clients. Which can be extended payment terms, flexible ordering and delivery.
6. Strengthen your brand positioning and allow your clients to use the benefits of your Brand.
7. Monitor customer satisfaction.
8. Make your customers your brand ambassadors.
Common Export Mistakes
Common mistakes that most exporters make include:
1. Considering an export market as an automatic extension of domestic business.
2. Absence of appropriate Market Research and an Export Business Plan.
3. Low management commitment to exporting.
4. Concentrating on too many customers in different markets as opposed to one or a few in selected markets
5. Neglecting export business when the domestic market booms.
6. Failure to build customer loyalty.
7. Rigid policies and practices in terms of payment terms, minimum quantities and delivery schedules.
8. Producing marketing tools and collateral only in one language, mostly in English.
9. Focusing on major brand names rather than targeting growing companies.
10. Not working closely with the National Trade Promotion Agencies.
REMEMBER: Your country’s Brand equity is always greater than your company’s. So always piggy-back on your country’s brand equity.
11. Misinterpreting “accidental export” to a country as a promise of better days ahead. It is important to select a market that holds the greatest opportunities for your products or services with the least amount minimum risk.
12. Not having a Plan B. It is important to closely monitor your export business and to always have a contingency Plan for any risks.