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Step 7: Selecting and researching potential countries/markets abroad

You are here:Step 7: Selecting and researching potential countries/markets abroad > Implementing the research brief > Evaluate the shortlisted countries in more detail > Compiling a shortlist of countries


 

 

Compiling a shortlist of countries

 

Narrowing down the field

The first step in your research process is to identify between two and five potential countries abroad that you can focus and do research on. Because of the distance, complexity and cost involved in undertaking market research in foreign markets, it is essential that you focus on only one or two (maybe three at the most) countries that truly offer your firm the potential for achieving export sales, and not spread yourself and your firm too thin.

Preparing a shortlist

To identify one or two countries as your target countries, you will need to begin with a short list of about five countries. This short-list you will identify through means of an evaluation of environmental factors that you consider to be meaningful to your firm and that are relatively easy to obtain. This is a very general evaluation which you will do in your office using mainly secondary sources (such as the Internet, trade magazines, directories, etc.). It is unlikely that you will use a market(ing) research agency to do this research or evaluation for you! You will probably make use of a broad range of information and statistics on issues such as gross domestic product growth, population size, literacy levels, cultural and language similarity, political concerns, legal issues, etc.

Your objective is to exclude those countries which clearly offer no opportunities for your firm to export to, while, at the same time, trying to identify countries with real potential for your firm. This is an interim evaluation - once you have identified your shortlist of countries, in the next step of the export process, you will evaluate these few countries in more detail in order to narrow down the list even further.

Focus on countries with potential

To achieve this, you will begin by considering all possible countries and, through a process of logic, commonsense and an evaluation of selected environmental factors that would be meaningful in comparing countries with each other, you will narrow your selection down to only a handful of countries to examine more closely. So, what factors are we talking about?

Well, this will depend entirely on your company and its products. Are you interested in countries that are well-off and technologically advanced, or are you more interested in countries that are still developing? Is literacy important to you, or does per capita income have more meaning for your firm? Are you looking for a country with an extensive road system, or one that has a major mining industry? Are you looking for a country with political stability because you require a long-term market to succeed? The answers to these questions will indicate what factors are important for you to look out for.

If you are looking for a well-off nation, then per capita income may be important. If you are interested in a fast growing country, then population growth and population size may be two good measures to use. If you are interested in a country with a significant mining sector, then mining figures will be of interest to you. So where will you find these figures or statistics to use for comparison purposes?

Sources of information to help you select countries

There are many different types of statistics and other figures available that you can use to help you segment the global market into groups of countries that have potential for your country and those that don't. The sort of figures that you may or may not be interested in, include:
  • Population size
  • Population growth
  • Population profile
  • Size of labour force
  • Level of education
  • Gross domestic product (which reflects the size of the economy)
  • GDP per capita
  • Inflation
  • Interest rates
  • Exchange rates
  • Size of exports and growth
  • Size of imports and growth
  • Major trading partners
  • Productivity
  • Political stability
  • Strength of currency
  • Language
  • Cultural diversity
  • Lifestyles
  • Telephones per capita
  • Internet users
  • Availability of electricity
  • Distance from South Africa
  • Size of the industry in question
  • State of development of the industry in question
These are only some of the factors you might want to consider. Which set of factors you choose, as we said, will depend on your company and its products. The sources of this information can be found by clicking here. You might also want to read up on doing desk and secondary research.
 

Once you have gone through this exercise, you will probably end up with three groups of countries. Those that are well suited for your products; those that may have some potential for your products; and finally, those that have very little potential for your products. It is this first group that you are interested in and which you will need to study more closely.

 
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Step 7: more information

Step 7: Selecting and researching potential countries/markets abroad
      Preparing a research brief
      Implementing the research brief
           .Evaluate the shortlisted countries in more detail
      Preparing a research report

 

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More information on Step 7
Learning to export...
The export process in 21 easy steps
Step 1: Considering exporting
Step 2:Current business viability
Step 3:Export readiness
Step 4:Broad mission statement and initial budget
Step 5:Confirming management's commitment to exports
Step 6: Undertaking an initial SWOT analysis of the firm
Step 7:Selecting and researching potential countries abroad
Step 8: Preparing and implementing your export plan
Step 9: Obtaining financing for your exports
Step 10: Managing your export risk
Step 11: Promoting the firm and its products abroad
Step 12: Negotiating and quoting in exports
Step 13: Revising your export costings and price
Step 14: Obtaining the export order
Step 15: Producing the goods
Step 16: Handling the export logistics
Step 17: Export documentation
Step 18: Providing follow-up support
Step 19: Getting paid
Step 20: Reviewing and improving the export process
Step 21: Export Management
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