Spanish export is worth $13.8Bn to the UK (OEC 2015). That makes Spain the UK’s 8th largest export market, with over 900 UK businesses operating in the Spanish market.
It’s easy to understand why Spanish export is so popular. 1 million British national residents plus 16 million British visitors annually mean the Spanish market is familiar with and interested in British products and services.
Spanish infrastructure is generally high-quality, efficient and cost-effective. Qualified, cost-effective suppliers are readily available. Cultural and technological barriers are low. And the Spanish export market can offer a gateway into lucrative Latin America.
In many ways, Spanish export is a no-brainer. And yet, small to medium businesses are often slow to capitalise. If you’re in that camp, hopefully this roadmap to Spanish expansion will help.
Research the Spanish market
Spanish export success rests on the assumption there’s an international market for your product or service – so neglect market research at your peril. UK Trade and Investment will cover 50% of the cost to commission market research so there’s really no excuse.
You want to know:
- Will people buy what you’re offering?
- Where is the market need?
- Can people afford your product or service?
- How can people access your offering?
The answers to questions like this determine the how, what and where of exporting. For example, you might decide your last-season unused inventory is great for Spanish export but your newest, premium line is best suited to domestic sales.
Understand your competitors
Business expansion doesn’t happen in a vacuum. Gov.UK report over 900 UK businesses export into Spain, while OEC research shows the Spanish export market was worth $13.8Bn in 2015.
All of which means you’ll be battling competitors, often more established than your business. You’re the new kid on the block.
Don’t let that put you off. The competitive landscape is an advantage because it means you’re not ‘flying blind’. You can enter the market with a wealth of knowledge your earlier competitors mightn’t have had. So, ask questions like:
- Who are your primary and secondary competitors?
- What are their strategic relationships?
- What products or services do they sell?
- Who are their suppliers, employees and buyers?
- What is their route to market?
And, importantly, ask what you can learn from their journey. What pitfalls have they faced, and successes achieved? That depth of insight will help you understand the market you’re entering.
Define your goals
As with any new business venture, you want to start small, prove concept, then scale. If exporting doesn’t prove profitable, you can spot that early, and extract yourself without incurring huge losses.
That’s why clear KPIs are central to lowering business risk. Define your goals and assign a specific, measurable KPI so you can measure progress. Your goals might look something like this, for example:
- To sell £1M of product into Spain over the next 12-months
- To achieve gross profit margin of 25% by year-end
- To expand product range with 3 new profitable products by year-end
Clear goals help ground your overall strategy, which helps ensure your Spanish export business becomes a success. Don’t miss this step out.
Make your strategy tangible with an export implementation plan. Decide how exporting will work for you in practice, in other words.
There’s no proscriptive model here – so much depends on your goals, business and limitations. You might transport UK-made goods to Spain, or set up Spanish manufacturing plants, for example. Maybe your current sales team will cover Spain, or perhaps you’ll build a dedicated overseas team.
You need to define your route to market, source transport and storage solutions, determine your supply chain, negotiate contracts, and so on. Many export businesses find it beneficial to hire a specialist logistics professional to simplify the process.
It’s also important to understand the legal implications of Spanish export. As a Spanish exporter, remember you’re subject to all in-country laws, including safety and product legislation. This might impact your go-to-market strategy considerably.
Build a marketing plan
Exporting your products or services into the Spanish market is only half the battle. You also have to sell them. That’s where a considered marketing plan comes in, raising awareness, creating desire and driving sales.
Think about the practical assets you’ll need:
- Do you need a new website?
- How will you take orders?
- What about local SEO, or local PR?
And the story you’ll tell within them:
- How will you tell your brand story?
- Which messaging will most resonate with your target audience?
- How does Spanish cultural nuance impact your communications?
A one-size-fits-all marketing strategy won’t be effective. Spain can feel very similar to the UK, but it’s still a different market. Prospects have different hopes, dreams, priorities, limitations and assumptions, and those things all impact how you communicate effectively.
Which brings us neatly to the next point…
Hire a native, professional translator
A native, professional Spanish translator is hugely important. You might assume you can skimp here because English is an accepted business language in Spain – which is true. But translation services give you precision and nuance you’d otherwise lack.
That’s why a native speaker is especially important. Even when they’re speaking English, your buying market (and suppliers, and distributors, etc.,) are culturally Spanish. There’s a cultural nuance there – you need someone who truly understands that culture, not just the mechanics of the language.
And that’s why you should seek a professional translator, not just any native speaker. Translating the essence of what you mean – not just the mechanics of what you say – takes a professional with experience interpreting the heart of your story, to translate that in the way that resonates most with the Spanish audience.
Network, network, network
You have a wealth of knowledge about your domestic market you might take for granted – things like supplier reputations, or business etiquette. Those snippets of insight are important to business longevity. Local knowledge – gained through networking – can help you build that insider’s perspective of the Spanish market.
Keep your eyes peeled for networking opportunities, even if they seem a little unconventional. In Spain, you can sometimes build better connections over a relaxed afternoon in a taperia than you do over several boardroom meetings, for instance. Build real connections, and you’ll be on your way to sustainable business.
If you’ve been considering European expansion, hopefully this roadmap will convince you Spanish export really is incredibly accessible.
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