Sales & Growth
Why some businesses are selling internationally more than domestically
Despite Britain abandoning its target of £1tn in exports by 2020, Be the Business meets three SMEs making more selling internationally than through UK customers.
As It Really Works Vitamins developed over the last three years there were two developments that took founder Fortuna Burke by surprise. The first was the power of Instagram, while the second is the growth in demand from overseas customers.
“We now sell about 80 per cent of our products abroad,” said Burke, who studied law and worked for the Guinness World Records before launching her vitamins and supplements site in June 2015.
Selling internationally was not high on her agenda, but the realisation this strategy could drive the company’s growth has been part of a learning curve. “The first few months were slow, but then I realised that it was really only men who were buying from us and so I targeted male consumers,” she added. “I also did some research and discovered that around two-thirds of Americans take supplements. I realised that this market offered huge potential.”
To satisfy American regulators It Really Works Vitamins supplements, which consist purely of natural herbal and vegetable extracts, are produced in a facility approved by the US Food & Drug Administration (FDA). The factory and its output, which is classed as food, also have all relevant EU certificates – making exporting easier. Now 33 per cent of exports go to the US and 18 per cent India, which is another growing market and the rest to countries around the world.
“We’re proud to be a British company,” emphasised Burke. “I’ve spoken to our customers and the message that came back was that because we’re a British brand people know our products are going to be high quality.”
The company, which employs seven people and whose head office is based in Enfield, North London, uses Instagram to help it with selling internationally. “We started working with our first influencer in November 2015 and business took off literally overnight,” explained Burke. Working with male style bloggers and Instagram influencers such as Tommy Tran, whose @stylebytommy account has over 500,000 followers, has boosted the company’s export markets.
Changing with the times
Vision Engineering is celebrating its 60th anniversary this year but over the last decade or so its business has changed significantly, exports hitting 93 per cent of its output last year. The company, based in Woking, Surrey, employs 220 people worldwide and produces optical equipment used in telecoms, aerospace medical device and other sectors.
It is now selling internationally more than it is domestically because of a change in its customers. “The UK is usually the base for research and development, while high-spec, niche products volume manufacturing is normally carried out elsewhere,” said Mark Curtis, managing director at the business. “It makes sense to manufacture only pieces in the UK with a high margin and perhaps with a greater degree of customisation. Our UK business has morphed from volume to a high tech, specialised product. Our volumes sales are now mainly abroad.”
The company has had to be agile enough to respond to these external factors. “We now export to companies in the US such as Apple, Google and Boston Scientific, which is a medical device manufacturer,” explained Curtis. Although it mainly manufacturers in the UK, Vision Engineering has invested in staff and facilities to supports its international clients – key to selling abroad successfully, it believes.
“We’re focussed on exporting to countries as if they were UK customers,” said Curtis. “We offer our overseas customers the same level of support. In our industry you have to provide great technical support both pre- and post-sale, in the right language and aligned with the culture of wherever those customers happen to be. We employ foreign staff in our offices as we find that this is better off than working with distributors.”
When it comes to selling internationally, one of the company’s most surprising success stories has been the provision of ergonomic microscopes for the hair transplant market in the US, Italy, Brazil and India.
Better fitting customers
The tagline of recently-launched fashion brand STORY mfg is “slow made.” This, it says, “highlights the celebration of the production processes along with the serious level of skill, emotion and time involved.”
Founded by husband and wife team Katy Katazome and Bobbin Threadbare, the London-based brand focusses on natural dyes and selling internationally was not particularly on the agenda when it was launched. However, now around 70 per cent of its production is shipped overseas.
“We discovered that the Japanese really like our oversized styling,” commented Threadbare. The company now has customers throughout Asia and selling to the Japanese means understanding their retail culture. “They’re very well educated about what they wear and they want to know all about the garments you’re selling. They also expect high standards of customer service – in stores you’ll find that as soon as you walk in someone comes over to help you.”
Jacob Thundil was sitting on Ipanema beach in Rio de Janeiro sipping coconut water straight from the nut when he realised that he could bottle it, which he knew well from his childhood in India, and retail it. Cocofina, which Thundil set up in 2005, became the first company to start selling coconut water in large quantities in the UK. But Thundil was keen to explore export markets.
“We realised that during the winter sales for drinks companies in the UK go down dramatically. But the sun always shining somewhere else in the world,” he said. “From the day we decided to export, we started to prepare labels in 12 languages, brochures, export documents and everything required to encourage export buyers. We’re clear on our channel strategy since we understand all products do not fit in all channels. We were expecting customers from Western Europe but we were surprised to export coconut products to Asia and Africa.”
It was the advent of Brexit that prompted a major increase in exports, according to Thundil, with overseas sales now accounting for more than half of the company’s sales. To succeed when selling internationally he advises companies to shortlist the target countries based on demand and earning power. After that it’s about being prepared and doing the right background work to find out what regulations exist for products. “Finally,” he said, “don’t be afraid to say no if the customer does not represent your target demographic.”