If you run a small scale export business, chances are that you are likely going to consider upgrading to large scale exportation if you know the reasons why large scale export business is best for you.
Exporting goods has always been a lucrative and profitable business. The demand for quality products remains high, especially in developing and emerging markets. But many businesses have stayed small-scale by exporting goods in small packages to individual buyers.
The big truth is that large scale export is a different ball game altogether.
It involves procuring goods in bulk quantities, storing them at a central warehouse, and subsequently shipping them to wholesalers or distributors who intend to sell it to retailers.
To set up an exporter venture you will need capital, resources, and contacts with potential clients abroad. This process is not that easy but if you have the right information and some planning, you can succeed at it as well.
In this post, we carefully pin-point seven reasons why you should venture into large scale exportation business, but first…
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What is Large Scale Export Business?
Large scale export business is one that deals with exportation of goods in large volume. It may also be any business that exports goods in large quantity to more than 20 countries at a time.
The large scale exporters have a strong financial capacity, higher organization, more experience and succeed in exporting their products and commodities.
On the other hand, the small scale exporters have a small financial capacity, less organizational abilities and lesser experience in exporting their products and commodities in large quantity.
Below are the 12 undeniable reasons why you should consider Large Scale Export Business if you wish to advance your exportation business.
Global economy is growing, so is the demand for international goods
You see, global demand for goods is growing and so is the demand for imports. This is due to a number of reasons.
First, the world’s population is growing and the number of middle-class consumers is increasing as well.
In fact, China alone has over 450 million middle-class consumers. This is a huge number, and these consumers are now buying goods that were previously deemed luxuries.
Consumers in these countries are also becoming more aware of global issues such as climate change, sustainability, and ethical sourcing. They want to know where the products they are buying come from.
In fact, around 65% of consumers are willing to pay more for sustainable products.
Exporting requires a lot of capital
As mentioned above, exporting goods in bulk is a different ball game altogether. You’ll need money for sourcing goods in bulk, setting up a central warehouse, hiring a logistic partner for transportation, and hiring a customs broker for documentation.
You’ll also have to spend money on advertisement, branding, and marketing. As a matter of fact, most small-scale exporters have to deal with financial hardship as they don’t have access to finance.
In order to bridge this gap and scale up your business, you’ll have to put in a lot of capital.
Now, the reason why you’re to bear this in mind is also connected to how much revenue in dollars can be generated from investing a huge capital (in naira of course) into the business.
It comes with huge trading benefits if properly managed.
SEE ALSO: How to Select the Best Logistics Service Provider in Nigeria
Businesses that venture into exportation become more productive and profitable.
Large scale exporting will allow you to produce goods in bulk and sell them to wholesalers and retailers in batches.
As a result, your unit cost per product will be lower as compared to small scale exporting. This means that you’ll be able to sell at a profit while your competitors will be selling at a loss.
Another way in which large scale exporting will boost your profitability is due to economies of scale. As your business grows, your overhead costs will decrease and you’ll be able to purchase goods and services at cheaper rates.
This helps you mitigate the huge investment cost among other initial expenses.
There’s potential to build your brand and increase sales
This one is very important, if not the most. It is the joy of every business to expand.
See it this way, as a large scale exporter, you want to necessarily consider adequate branding. It enables client build trust and consistency patronizing a growing brand.
As your business grows and becomes more profitable, you’ll be able to expand into new markets and open new branches.
This will enable you to establish your brand and sell products at a higher volume.
You’ll also be able to build relationships with other businesses, including wholesalers and retailers and consequently expand your business and increase sales inter-relatedly.
Access to exclusive information about market trends and products.
As your business grows, you’ll meet new people and forge relationships with other businesses.
You’ll also be able to access information about new markets and products that you can export.
For example, large scale exporting enables businesses to access information about new markets.
You’ll be able to find out about the demand for your product in different countries, including their preferences, demands, and spending power.
Increase your global presence and business credibility
As your business scales up and becomes profitable, you’ll be able to partner with large suppliers and wholesalers.
You’ll be able to offer discounts and attractive deals to retailers, which will help you increase your credibility.
You can also use this opportunity to create a joint venture with a foreign partner. You can team up with a business from another country and export goods to their market as well.
Exporting goods also gives you an opportunity to enhance your company’s reputation. You’ll be able to prove to your customers that you’re reliable and can deliver on time.
Establish you as a market leader in your industry
As you provide exports goods to other countries, you’ll be able to become a market leader in your industry.
This will help you become an industry leader in your region as well.
Exporting goods to other countries will also allow you to become an authority in your field.
This will help you create scalable jobs as well as bring international recognition to your company.
Enormous Market
Large-scale export business is a great way to make money, but it also allows you to do something meaningful in the world. With large scale export business, you can help people around the world who need it most.
By helping these people by providing them with products or services that they can’t get anywhere else, you will be doing your part in making sure everyone has access to those things and more!
Read Also: SONCAP Requirement for Exportation
Hardly any Competition
You will be able to sell your products and services at competitive prices. This is because there are hardly any competitors who are competing with you in the same industry.
This means that you can sell your products or services at a lower price than the competition and make more profits than them.
You need not worry about losing money because of competition; all it takes is one sale for you to gain profit margins on every item sold by yourself or through an agent/broker who manages your account(s).
No shortage of customers
Large scale export business is one of the best ways to get your product or service in front of a large number of people. You can sell at an affordable price, which means you will not have to compromise on quality for your customers’ sake.
Low competition from other small businesses in the market place. The main reason why large scale export businesses are so popular among small and medium enterprises (SMEs) is because they provide them with opportunities that are unavailable elsewhere at this time.
No worries in case of currency fluctuation.
The second benefit is that you don’t have to worry about currency fluctuations. In case of a currency fluctuation, your business will not be affected because the entire transaction will be done in US dollars or other currencies which are stable.
Easier to find markets
Large scale export business is for you because it’s easier to find markets. In fact, there are many markets out there that have huge potential for your business, but they aren’t easy to reach.
For example, the US market is one of the most important markets in terms of sales volume and growth potential. However, if you want to sell products or services from here then it will take time and effort before you get any results from this market.
Freighting for a Large Scale Exportation Business
Although it may be your decision to upgrade to a full time large scale exportation business operation in Nigeria to other parts of the world, it is ours at Bowagate Global Ltd to ensure you succeed in your business.
We provide freight shipping services for businesses dealing in exportable products from Nigeria to any other parts of the world. It may involve quite a lot to get on with complete export of local products, we engate our clients in consultations, and render both freight services and customs clearing for Imported goods at the Port in Nigeria.
Our membership with reputable international bodies like the Fédération Internationale des Associations de Transitaires et Assimilés (written in French for FIATA), World Cargo Alliance (WCAworld) amongst others, give us leverage while guaranteeing you safety and delivery assurance covered with maximum security.
Conclusion
If you want to start an export business, then it is the right time. There are many advantages of doing so. All you need is a little bit of courage and determination to start with this venture.
It’s clear that there are numerous benefits associated with large scale exporting business.
However, it’s important to understand that it’s a completely different ball game. You’ll need a lot of capital and access to exclusive information about market trends and products.
You’ll also have to hire a logistic partner for transportation and hire a broker for documentation. However, if you’re willing to go the extra mile, then large scale exporting is definitely worth it. It’ll allow you to produce goods in bulk, become more profitable, and expand your business. Furthermore, it’ll help you become a market leader and provide a wide range of benefits to your company.
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