Move into foreign markets

Strategic advice

Technology advances have come faster than usual in recent years. Ecommerce has experienced 77% year-over-year growth as many businesses have shifted to digital trade.1


These same advances in technology allow businesses to access foreign markets more easily. The exchange of services—construction, business to business (B2B) services, information and communication technology—currently encompasses more than 55% of global trade and is expected to substantially increase through 2025.2


Simpler technology-enabled trade gives you access to the world’s market—in both developed countries and emerging ones. Emerging economies—representing over 80% of the world’s working-age population—are the best long-term prospect for your company’s growth in foreign markets.3 Transitioning to different political and trading environments can be tricky, but you can access the most profitable emerging market for your products or services through careful assessment and collaboration with experienced trading partners.

4 factors to consider before moving into foreign markets

To engage in international trade, you’ll need to identify demand for your product or service in markets overseas. Before targeting specific foreign markets—particularly those still emerging—you’ll need to account for:

Business environment

  • Understand your targeted market's business environment - Emerging markets are nothing like domestic ones. Be mindful of cultural differences, unfamiliar business practices, varying trade regulations, and political unrest.
  • Will Brexit—the United Kingdom’s (U.K.) break from the European Union (E.U.)—affect your exporting strategy? The longstanding practice of using the U.K. as a ‘gateway’ to trade with the rest of Europe could expose your business to tariffs when goods pass through the U.K. and again upon arrival in the E.U. Keep close watch on the ever-evolving U.K and E.U. trading relationship as it could mean renegotiating your existing contracts and intellectual property rights over the coming years.
  • Keep up with your company’s access to credit, investor protection, trade across borders, and contract enforcement - Analyze your targeted market’s export potential and accessibility using information from rankings on 190 countries.

Labor costs

  • How will labor costs affect your business? The labor cost advantage in emerging markets is smaller than it once was but may still be significant to your company. Be sure to consider the indirect costs of supporting labor overseas, like benefits, training, commercial real estate, technology, etc.

Transportation methods

  • What are the implications of domestic vs. offshore/nearshore production for your business? How is your product transported? Is it easy to ship? What’s your optimal shipping method—by air, sea, rail, or some combination? How will that affect the price of your product or service in foreign markets?
  • Can your product be shipped directly to consumers? Ecommerce provides a direct way for you to reach customers in targeted markets. However, many countries are changing how low value shipments are treated. Some—like Australia—are no longer waiving value added taxes. How will changing fee schedules and shipping costs affect your pricing model?

Delivery channels

  • How will your product or service be delivered? Developed vs. emerging markets have vastly different infrastructures. How will infrastructure affect delivery of your product or service to consumers? Will you need a broker for B2B prospects? Can you reach “mom and pop” operations in emerging markets? Does your company deal directly with product specific mega-marts like furniture outlets in China or electronic retailers in Thailand?
  • Do foreign markets have the infrastructure you need? Emerging markets vary greatly in standards for roads, rails, ports, and even power supplies. Make sure your product can be delivered and serviced without adding substantial costs.

Take advantage of available resources.

The resources below will help you assess your product’s marketability within specific markets and target the most promising ones for your company’s exporting initiatives.

Ready to move forward overseas?

Have a team of trade experts by your side. Talk to your Truist relationship manager or global trade specialist today to start capitalizing on foreign trade opportunities.