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Keen to export: know where to start?
accelerateonline • May 1, 2019
Here’s what you need to think about before hitting the (overseas) ground running.
- What’s your value proposition? Having a short statement outlining what is unique about your product is not only a powerful selling tool, it helps you work out whether there’s even an offshore market for it.
- Which markets will return the most profit? Unsure where to export? Ask yourself these questions: Can you enter the market? Is it a good place to do business? Is there a real opportunity for what you offer? Can you reach your customers easily?
- Know your market: Get on a plane, visit trade shows, expos and do some digging on your competitors, their pricing and distribution channels.
- Who will you partner with? Agents and distributors are the most common channel choice for Kiwi exporters but consider an overseas office, selling directly to customers online, licensing or franchising too.
- Can you handle global growth? Don’t commit to exporting until you’re armed with adequate financial resources, a committed management team and proof your product does well in New Zealand.
- Do a compliance checklist: Failing to comply with international requirements is risky. Look into product liability insurance, product safety and standards, packaging and labelling, barcodes and tracking, transport, and online compliance. Set aside a budget for these changes to avoid nasty surprises.
- Will you make a profit? The cost of exporting is different for every business. You’ll need to complete a cash flow forecast and work out your break-even point to see if it’s even viable.
- What’s your pricing strategy? Work out your costs, ensuring a healthy profit in your final prices, then talk to the experts about which pricing strategy is on point for your business and market.
- How will you get your product overseas? Think hard about your product, its customer, and where your goods need to go. Then get advice from a professional freight company or customs broker.
- Can you afford to export? Even established businesses feel the financial strain of exporting. Seek good financial planning advice early on and consider debt funding (loans, leases, overdrafts, terms of trade) or equity funding to finance your offshore activity. Whichever way you go, put some fat in your budget to cover unexpected costs!
To explore the above in more detail, Google: NZTE’s Export Essentials Guide.
Accelerate - December 2023
Accelerate August 2023
Inland Revenue have recently announced this year’s livestock Herd Scheme Values and we think this is a great opportunity to update you on the latest movements. The Herd Scheme Values are the National Average Market Values, determined by a process involving a review of the livestock market as at 30 April.
The values for Dairy this year have seen a fall in values across all female classes, but increases across all male classes. The fall in R1 heifer values can be attributed to the prohibition of live export by sea commencing from 30 April 2023. For the first time the National Average Market Value for R1 Heifers is less than the National Standard Cost of breeding and rearing an R1 Heifer.
In contrast to Dairy values Beef values have increased on average 9% and are almost at record values for all classes.
Sheep values have all fallen from the high of 2022, slipping back an average of 10.2%. Whilst values have fallen, they are still either the second or third highest that they have ever been depending on which class of sheep you are looking at.
Goat values have increased on average 7.8% with almost all classes of fibre and meat producing goats at record highs. The value of milking goats continues to be well down from historic highs, except for breeding bucks which are at their highest value.
Like the rest of the world, New Zealand has reeled from the aftermath of Covid, rising inflation and interest rates, and the cost-of-living crisis. This year we also have a massive storm damage repair bill.
Any tax cuts, or changes to the tax thresholds were vetoed in Budget 2023 as this was viewed as worsening inflation.
Budget 2023 builds on the $889m already provided in response to this year’s storms. A further $6b is allocated for a National Resilience Plan , for rebuilding after weather events. $71b is committed to new and existing infrastructure projects: not only storm damaged communications, power and roading, but schools, hospitals, public housing, rail and road.
