Learning About Doing Business Internationally

When you start out as a local business you get to know your community. You get to know customers large and small by their names. You even get to know their families.

You learn all the small quirks and minor hoops you need to jump through to do business locally. You get to know shipping rates, taxes, and everything else. It takes while to really get a grasp of everything that goes into running a successful local shop or service business.

Then, you decide you’re doing so well that it’s time to expand. It may seem like a very logically and easy next step, but there’s a very big part of growth many people overlook: logistics.


Side from all the sales, networking, order processing, legalities, and tax implications you have to adjust too when expanding out of your local area, you also need to figure out how to source more materials and deliver your finished products. It can be and usually is an absolute nightmare.

Airfreight

One option you can use to handle all of you new transportation needs is airfreight. It has one very big pro and one very big con.

The pro is of course it’s very fast. It’s about as fast as you can get. Depending on the size of you shipments and the distances in between them, it can be as fast as 24 hours. You aren’t going to beat that.



The major con though is in almost all circumstances, it’s extremely expensive. Depending on the business you’re in and your margins, it’s probably not a good choice. For us, it was not.

However, if you need to ship overseas, it’s one of the only two options you have.

Ocean Freight

This should be fairly self-explanatory. You skip the pricey airfreight and use large cargo ships that travel back and forth between ports in different countries.

The major pro here is the cost. It’s much cheaper than airfreight. That’s why we used it when we originally expanded our fabric business. We had factories in China and needed to move product direct from there to England and Ireland. Shipping from China to the UK is immensely cheaper than trying to use airfreight.

It is slower, but money you’ll save translates directly to you bottom line.

Ground Transportation

This is the most common option among the three you have. It’s also going to be part of all your logistical needs.

If you use airfreight, you need to get the product from the airport to the final destination. Thus, you will use ground.

If you use ocean freight, you still need to move your product from the port of delivery to the final destination. Thus, again you will use ground.

And, if you are not shipping overseas, you might just choose to use only ground transportation due to the cost. Though, you will want to triple check the time as ground transportation might not always be worth it across long distances, even if it’s cheaper.

Conclusion

If you want to expand your business from a local only business to a regional or international one, you need to take a crash course on logistics. If you don’t get it right, it could cost you any profits you hope to make. Worse, it could put you in the red.

If it’s your first time, do not be scared to reach out and hire a consultant to help you get started. It might be expensive at first, but it will save you money over the long haul.

Trackbacks

Trackback specific URI for this entry

This link is not meant to be clicked. It contains the trackback URI for this entry. You can use this URI to send ping- & trackbacks from your own blog to this entry. To copy the link, right click and select "Copy Shortcut" in Internet Explorer or "Copy Link Location" in Mozilla.

No Trackbacks

Comments

Display comments as Linear | Threaded

Add Comment

Enclosing asterisks marks text as bold (*word*), underscore are made via _word_.
Standard emoticons like :-) and ;-) are converted to images.

To prevent automated Bots from commentspamming, please enter the string you see in the image below in the appropriate input box. Your comment will only be submitted if the strings match. Please ensure that your browser supports and accepts cookies, or your comment cannot be verified correctly.
CAPTCHA