Now let's take a look at targeting the right market for your product or service. The good news is that you have probably already accumulated sufficient knowledge to create a short list of potentially appropriate markets. It's just a matter of using your experience and business sense to narrow down your choices of potential export markets.

A short list of potential target export markets is simply the sum of your experience, knowledge, and business sense applied to your product or service outside your traditional market area. In today's global economy, you're probably at least somewhat aware of what's happening in your industry in other parts of the world, just by talking to others in your industry and staying abreast of news via trade magazines, the business section of your local newspaper, and the Internet. If not, you should be!

Product knowledge
(What's good about it, and why customers should buy it)
+
Market Knowledge
(What customers are looking for, and what they're buying)
+
Competitive Knowledge
(What they're selling, and how you compare to them)
+
Your Experience and Business Sense
=
Deciding Which Export Markets to Evaluate First

For example, companies who manufacture construction or other weather-dependent products invariably have to contend with a seasonal cycle. So the obvious first places for them to consider in order to flatten their demand cycle, are tropical or southern-hemisphere markets where it's warm when we're cold here in Canada.

Then, in this example, start looking for differences in building practices. In some locations, temperatures never or rarely fall below freezing. In others, block and concrete construction, tile roofs, or repelling (instead of containing) heat are the norm. How do these variable affect you? It often takes a little research to get an initial feel for the market (we'll talk about how to do that next month) but whatever the product or service you're selling, see the list below for some questions to ask yourself as you consider your next export market.

You may have heard the old story about the two shoe salesmen who travelled to a warm-climate developing country in search of new business. One returned disappointed, saying that there was no market because nobody there wore shoes, while the other returned ecstatic – the market was enormous, because nobody wore shoes. Which one was right? One thing is for sure – the first one didn't generate any sales!

A principle I often use when evaluating new international markets is "The Three F's" (and none of them are cuss words!): Force, Failure, Fast.

Is this a defeatist attitude toward business? Not at all. Instead, it suggests that you look for the obstacles and challenges first – they're almost always there, so you might as well find them before they find you. If you discover that you can find a way around, over, or straight through the challenges that stand between you and successful export market penetration, go for it! But if you find instead that you're looking at one or more insurmountable "dealbreakers" (prohibitive cost of freight, complete inapplicability of your product or service, etc.), stop right there, rethink your product, market, or strategy, and avoid wasting time and money on something that has little or no chance of success. Not all international business initiatives are successful. The key is to discern which ones have a good probability of success – and which don't – at the earliest stage possible.

Here are some questions to ask yourself (and make some enquiries on if you don't immediately know the answer) as you consider which export markets are the best targets for your product or service:

• What other locations in the world use similar products or services to yours? Can you carve a niche there?
• Where are your products not used now – but might be soon? Can you anticipate the product life cycle of your product in a "lagging" market?
• Where should potential customers be using your products? Why aren't they?
• Where in the world are your competitors already operating? Can you offer a better, cheaper, or different alternative?
• Why do your existing customers buy from you now? Do new potential customers buy for the same reasons, or are there different buying criteria?
• What limitations are there in your existing market that may not exist in others?
• What global industry trends exist that may affect you? How can you take advantage of them?

As you consider how to grow your business into new markets around the world, pick one to three potential markets that appear to make sense to you based on your experience. In the next article, we'll examine ways of researching those markets to confirm whether or not those markets are appropriate for you.