Australia is competing in an international market where a company from Germany can easily and quickly transport its products to France or any other neighbouring nation. So finding a niche in the market, or focusing on Australian-made branding can give companies down-under an advantage. But some manufacturers that successfully export products overseas explain that it’s more about improving communication and partnerships with distributors.
“A lot of the success we’ve had overseas is finding good distributors,” said Jehbco Silcones marketing manager Jessica Fernandez. Jehbco Silcones manufactures silicone extrusions and gaskets used on applications such as window seals for aircrafts and tubing for food and beverage manufacturing. While Fernandez said Jehbco Silcones’ products are reliable and have special features such as custom-made dies, solid partnerships with overseas distributors push exports over the line.
“Having marketing campaigns that can target overseas markets, with the help of distributors, helps our success. It makes your job so much easier when someone else knows the market. Finding a good distributor that you can hop on the back of is really great,” said Fernandez.
Jehbco Silcones’ overseas markets include the US, China and New Zealand, where Jehbco Silcones targets large enterprises. “A few years ago we really cut down on staff, we got rid of 80 per cent of our business. We’ve really been focusing on the bigger clients. It’s difficult to grow but all of this growth pain has made us a better company.”
The company invested in more research and development and Internet of Things (IoT) solutions to improve its businesses. Now, Jehbco Silcones is able to focus its business on large companies in the aerospace sector to which it exports products regularly. “We had an increase of about 20 per cent of staff last year. We’ve really been scaling up.
“Getting in the export market is really more about perseverance and persistence. It’s deciding if you want to make that commitment,” said Fernandez.
Other companies such as Redarc Electronics, agree that studying the market and investing in a third-party to help drive growth is a step to successful exports. Redarc managing director Anthony Kittel said when the company first embarked on developing export business, an entry-to-market strategy was critical to creating a global market strategy.
“We spent 18 months studying the North American market and developing our market entry strategy. In Europe, we did likewise to identify the key Redarc products of interest, the right path to market and the right partners. In the case of European market development, we engaged a third party to conduct this market study on our behalf and then Redarc staff in conjunction with the consultant developed the strategy,” he said.
Kittel acknowledges that market studies are not a one-off solution to finding the right gap in the market. “We conducted regular market visits to gauge customer interest and understand the competitive landscape, prepare a competitor analysis, price positioning, distribution network, sales channels, on-line trends, warehousing options, sales representation and more,” said Kittel.
Redarc, which develops and manufactures a range of electronic voltage converters and associated products, inverters, brake controllers and power supplies, exported to more than 35 countries in 2018. But, this hasn’t come without its challenges. Kittel said generating brand and product awareness requires a lot of attention.
“The Redarc brand is strong in Australia, but not as well-known abroad. Large wholesale distributors want to be assured and shown a plan on how you’re going to create the brand and pull the stock through their channel. Simply put, if you don’t have a name overseas, how are you going to create that? We have been prepared to demonstrate our investment in their business as well as our own,” said Kittel.
To further combat these challenges, Redarc has also employed staff in the target market that are familiar with the market and the company’s customers. “They speak the language and can talk confidently about our business and products. We have also developed staff to offer a high level of technical and after sales support in the target market,” he said.
For Australian businesses wanting to enter overseas markets, Kittel suggested finding a point of difference or value proposition. “Consider carefully, if it is strong enough to compete against those already operating in the market.”
Choosing the right sales channels for that market – such as online or wholesale distribution – and patenting and trademarking a brand are also important moves when shifting into an international market, said Kittel.
But just as Fernandez mentioned, hard work is of utmost importance. “Have a relentless passion to build the reputation of your business,” said Kittel. “It doesn’t miraculously just happen.”
Jehbco Silcones and Redarc Electronics were finalists for the Exporter of the Year award at the Endeavour Awards 2018 – with Redarc winning the category. Along with the other finalists, Benbro, Matthews Australasia and CST Composites, these companies have successfully entered international markets. But Benbro CEO Daniel Martinez said bureaucratic and regulatory challenges, long decision-making time and cultural differences are all challenges Benbro has faced when exporting products.
“These challenges were overcome by patience – lead time will take at least two years – and having a well-vetted and trusted partner rep and distributor,” said Martinez.
He suggested implementing a double-layer structure, as having a distributor and a rep can help. “Ordinarily, a traditional distributor will have a variety of products to handle and will not necessarily spend its entire resources on your range. So, we adopted a dual-pronged approach. We appointed a rep with good government and industry connections as well as a conventional distributor in each country, and we have asked each of them to co-ordinate their efforts.”
Benbro exports to New Zealand, China, Micronesia and Papua New Guinea. “We are exporting our range of electronic components and are now developing LED street lighting for the Philippines. We are one of a small group that actually export to China. Most, as you know, import from China,” said Martinez.
The 2019 awards have a new spin on celebrating exports, with the Global Supply Chain Integration of the Year award. Nominees for this award will be evaluated on their unique experience and/or products that allow them to successfully access the global supply chain.
Companies must be able to demonstrate the extent of their international network and reach, as well as showing how they have adapted to succeed in the international market.
As part of the Endeavour Awards 2019, the best in global supply chain integration will be announced on May 16 at the Arts Centre Melbourne, along with a number of other prestigious awards. To be a part of the Endeavour Awards, companies can submit nominations online at www.endeavourawards.com.au.