Exports

Exports are goods or services produced in one country and sold abroad. The business making them stays at home, but the customer is based in another country. It is the opposite of importing.

Why businesses export

Selling abroad opens up markets far bigger than the business's home country. A firm with a small domestic market may find far more potential customers overseas, so exporting can increase both sales volume and revenue. Each new country is another set of customers who would never have bought from the business otherwise.

Exporting also helps to spread the brand name. Customers abroad get to know the business and its products, which can make it easier to win more orders in those countries later and to build a reputation beyond its home market.

For example, a small Bristol firm making rechargeable bike lights might sell mainly to UK cycle shops. Exporting to bike shops in Norway and Canada reaches customers who cycle in very different conditions, sells many more units and gets the firm's name known among cyclists abroad.

What exporting can cost a business

Exporting is rarely as simple as posting a parcel. Higher costs are common: transport and shipping over long distances, customs paperwork, insurance and sometimes paying an overseas agent to sell on the business's behalf all add to the price of each sale.

Language barriers can cause problems too. Instructions, packaging and contracts may need translating, and misunderstandings with overseas customers or agents can lead to mistakes and lost orders.

There can also be legal restrictions. Different countries set their own rules on product safety, labelling and ingredients, and a business must meet them before it can sell there. A product that is legal to sell at home may need changing, or may not be allowed at all.

Weighing these up matters: exporting can grow sales and revenue, but only if the extra income covers the extra costs and the business can meet each country's rules.