Search

Preparing to export

Consultation and bespoke research

A range of information for exporters can be found online, including advice and guidance on how to research overseas markets thoroughly. For more information, visit: https://www.great.gov.uk/.

Researching the Australian market

When you start to sell your products or services in Australia, it is essential that you have a clear plan and carry out extensive market research.

Australia’s states and territories have some regulatory differences, therefore you must make sure you are up-to-date with the regulations that apply to the area you are doing business with. Half of the country’s population resides in four of its major cities; it is advised that you prioritise these areas once you begin your market research for your product or service. You can carry out a combination of desk research and market visits, which will help you to determine whether:

  • there is a market for your product or service

  • your pricing is competitive

  • you need to localise your product

  • you need to adapt your business model

  • you have the resources in place to tackle a market this size

For more information and guidance regarding how to carry out overseas market research, see the DIT’s ‘Understand export market research’ page at: https://www.great.gov.uk/advice/find-an-export-market/understand-export-market-research/

Also see DIT’s events portal page to find upcoming events that are taking place in Australia: https://www.events.great.gov.uk/ehome/index.php?eventid=200183029&.

DIT’s trade specialists can help you commission services from local experts in Australia. This includes:

  • country and sector advice

  • local market research

  • support during overseas visits

  • identification of possible business partners

  • preparation for exhibitions and events

Make regular visits to Australia, and make contact with others in your industry/sector that are already in Australia. This will keep you updated on all advice and information, and can give you a new understanding of the country. At the very least, this can help you form the foundation for further research.

For more information and guidance on how to develop your marketing strategy, competitor and SWOT analyses and customer/market segmentation, visit: https://www.great.gov.uk. The IOE&IT can also help with this: https://www.export.org.uk/

You need to make sure that there is a market for your product/service, if your pricing is competitive, whether you will need to change your product in terms of its packaging or marketing, and whether you need to adapt your business model.

The questions listed here should help to focus your thoughts. Your answers to them will highlight areas for further research and also suggest a way forward that is right for your company. You may then want to use this as a basis for developing a formal strategy, although this may not be necessary or appropriate for all companies:

Your aims:

  • Do you wish to buy from Australia, sell to Australia or both?

  • Do you wish to establish your own company presence in Australia, or consider for example direct sales, licensing or franchising?

  • Do you need to be involved in Australia at all?

  • Do you see Australia as part of a wider plan including e.g. other Oceanian markets, now or in the future?

Your company:

  • Can you carry out a detailed SWOT analysis of your company?

  • Are your competitors already in Australia? If so, what are they doing?

  • Can you carry out a detailed SWOT analysis of your competitors?

  • What are the Unique Selling Points (USPs) of your product or service?

  • Do you know if there is a market for your product or service in Australia?

  • Do you know if you can be competitive in Australia?

  • Do you have the time and resources to handle e.g. the demands of communication, travel, product delivery and after-sales service?

Your knowledge:

  • Do you know how to secure payment for your products or service?

  • Do you know how to locate and screen potential partners, agents or distributors?

  • Have you carried out any Australia-specific customer segmentation, and do you know how to best reach potential customers in-market?

It is unlikely that you will have the answers to all these questions at the outset and these ‘knowledge gaps’ could form the basis for further research and investigation. Some of these questions will require quantitative research in your sector, while others involve more contextual and cultural considerations.

Talking to other people in your industry and regularly visiting Australia will give you access to the most current advice and such experience can often lead to new insights and form the basis for further research.

Export plan

You will need to create an export plan after you have carried out your initial research, which will identify your best route into the Australian market. Guidance on developing an export plan, including marketing strategy, customer segmentation, competitor and SWOT analyses, etc. is available on the: https://www.great.gov.uk/advice/create-an-export-plan/how-to-create-an-export-plan/ site, and also on the Institute of Export’s Open to Export site at: https://opentoexport.com/info/export-action-plan/.

Trade shows held in Australia each year are a way for you to test whether your product/service would be viable in the Australian market. The UK’s Department for International Trade (DIT) provides funding in the form of grants via the Tradeshow Access Programme that allows eligible businesses to attend overseas trade shows.

This funding helps businesses to gain the most out of overseas trade shows, including market knowledge, experience and advice from trade experts. Visit: https://www.gov.uk/guidance/tradeshow-access-programme for more information.

For information on future events and trade missions in Australia, visit the DIT events portal at: https://www.events.great.gov.uk/ehome/index.php?eventid=200183029&

For company launches and events held at British High Commission locations, contact the Department for International Trade (DIT) in Australia at: https://www.gov.uk/world/organisations/department-for-international-trade-australia#contact-us

[Source – DIT, gov.uk]

 

Start-up considerations

Setting up a company or office

In Australia, business enterprises can operate in a number of ways, including as a:

  • company

  • foreign branch

  • trust

  • joint venture

  • partnership

  • sole trader

The formation of a business is mostly carried out through registration as:

Depending on the business structure you decide to choose, the taxation and legal obligations your business will be subject to will differ.

See the Australian Trade and Investment Commission’s ‘Setting up a business in Australia’ webpage at: https://www.austrade.gov.au/International/Invest/Guide-to-investing/Setting-up-a-business.

In order to start out in the Australian market in a way that is best suited to your sector or activity and to help you avoid making any costly mistakes, make sure you consult a local lawyer before you enter the new market.

[Source – DIT: Exporting to Australia]

Distributorship agreement

Rather than export directly, it may be easier to work with an Australian partner or adviser. They will be more familiar with the business environment in Australia and should be able to help with:

  • keeping in contact with customers

  • seeking new business

  • getting information on the latest market trends

Before choosing an agent or distributor, research several potential associates, visit the market numerous times and make sure you are positive you have made the best choice for your company. Make sure you check their reputation, marketing ability and resources. Be aware of those who promote similar or the same products/services as you.

The Department for International Trade (DIT) team in Australia at: https://www.gov.uk/world/organisations/department-for-international-trade-australia#contact-us can assist you in locating and meeting potential agents and distributors for your products in Australia.

[Source – DIT: Exporting to Australia]

Direct exports and sales

When you directly export, you must take care of the logistics of marketing, selling and sending your products or services overseas, and getting paid. If you plan to sell your goods/services online to potential Australian purchasers, or you are responding to enquiries, this may be the most viable option.

Further information on selling directly overseas can be found at: https://www.great.gov.uk/advice/define-route-to-market/direct-sales/.

[Source – DIT: Exporting to Australia]


Selling in Australia through local agents, distributors or wholesalers

It can be more effective to use a local representative due to the distance and time zone issues.

If you need to service customer queries and problems regarding your product or service, a local point of contact can be of particular importance. This point of contact can take the form of an agent, distributor or wholesaler, among other options.

DIT’s trade specialists can help you to identify local representatives that can be your local point of contact regarding your product and services in Australia: https://www.gov.uk/government/organisations/department-for-international-trade/about-our-services#getting-local-market-help-to-sell-overseas.

[Source – DIT: Exporting to Australia]


Online selling

If your business has a digital presence, you will gain new customers due to them being able to access your business 24/7. This is also often at a low cost.

Value added tax (VAT) must not be charged for online sales in Australia. When you ship the products, you must fill out a customs declaration and also keep proof of the exportation of the goods.

DIT can help to find suitable online marketplaces for your product/service. They can also help to access preferential government deals.

The Department for International Trade (DIT) can help you export your goods to Australia through the E-Exporting Programme. Find out more at: https://www.gov.uk/guidance/e-exporting

DIT has also negotiated listings at better-than-commercial rates. See online marketplaces in Australia at: https://www.great.gov.uk/selling-online-overseas/

[Source – DIT: Exporting to Australia]


Licencing and franchising

You can licence your products and services for them to be sold in Australia if they are deemed suitable. This is a cheaper way to enter the Australian market as apart from the cost of any legal agreements, there are no other set-up costs.

In order to make sure that your Intellectual Property (IP) rights are protected, carry out due diligence on licensees.

For more information concerning the licensing of Intellectual Property, see the gov.uk’s website at: https://www.gov.uk/guidance/licensing-intellectual-property.

The Australian Government heavily regulates their franchise industry.

When setting up a franchise in Australia you must comply with the Australian Franchising Code of Conduct: https://www.accc.gov.au/business/industry-codes/franchising-code-of-conduct/buying-a-franchise

You must also be registered at the Australian Franchise Registry: http://www.thefranchiseregistry.com.au/.

For further information on franchising, see the British Franchise Association’s international section at: https://www.thebfa.org/international/.

[Source – DIT: Exporting to Australia]

Consumer protection

You must comply with Australia’s consumer protection law if you are selling to Australian consumers. This law guarantees the rights of consumers when they buy products or services. See the Australian Consumer Law website for more information: https://consumerlaw.gov.au/.

Legislation is set at federal, state and territorial level within Australia, therefore be aware that consumer rights may differ. To confirm whether you are complying with the correct legislation, check with the fair trading offices for the Australian state you are to do business with, on the Australian Government’s Business website: https://www.business.gov.au/Products-and-services/Fair-trading/Fair-trading-laws

The Competition and Consumer Act 2010 outlines the national law for fair trading in Australia. The law regulates how businesses should deal with their customers, competitors and suppliers.

[Source – DIT: Exporting to Australia, Australian Government, Australian Competition & Consumer Commission]

Professional indemnity insurance

You may require professional indemnity insurance if you provide a service and need to protect yourself against negligence claims from clients or third parties in Australia.

See the Association of British Insurers (ABI) website at: https://www.abi.org.uk/products-and-issues/choosing-the-right-insurance/business-insurance/liability-insurance/professional-indemnity-insurance/ for further information, or alternatively, contact the DIT team in Australia at: https://www.gov.uk/world/organisations/department-for-international-trade-australia#contact-us for further advice, and for contacts of local insurers or specialist brokers if appropriate.

[Source – DIT: Exporting to Australia]

 

Financial considerations

Getting finance to fulfil an export contract

Australia ranks 4th out of 190 economies globally for ease of ‘Getting Credit’ according to the World Bank’s Doing Business Report 2020. See: https://www.doingbusiness.org/en/data/exploreeconomies/australia

Schemes are available to UK companies to make it easier for them to fulfil an export contract and grow their business. These schemes are for those who are selling products and services in Australia. For further information and assistance, contact your bank or a specialist financial organisation.

UK Export Finance (UKEF) has significant risk capacity to support exports to Australia: https://www.gov.uk/guidance/country-cover-policy-and-indicators#australia.

Contact one of UKEF’s export finance managers for a free and impartial consultation: https://www.gov.uk/government/publications/find-an-export-finance-manager. They can help check you are getting the appropriate financial support and, if not, explore how to bridge any gaps.

[Source – DIT: Exporting to Australia]

Getting paid in Australia

To get information regarding finance, such as how to get paid, you may want to contact a specialist. Specialists include banks or accountants. Alternatively, you could contact the DIT team in Australia who will be able to help you find a financial adviser: https://www.gov.uk/world/organisations/department-for-international-trade-australia#contact-us.

The terms of payment should be specified in your contract. You will need to secure terms of payment in Australia. This can be through a letter of credit, cash, or a partial payment in advance.

See the Institute of Export & International Trade’s webpage which addresses different methods of payment: https://www.export.org.uk/page/Methods_of_Payment.

Only when you have established a trading relationship should you consider the use of open account payment terms. This means to deliver the goods before payment has been made.

In order for consumers to buy your products and services, they may require credit terms.

When considering prices, payment conditions must be factored in. In terms of business-to-business transactions, these conditions could include immediate payments on receipt of goods (often with a negotiated small discount) to a negotiated 60-day payment.

[Source – DIT: Exporting to Australia]


Payment risks

UKEF can help UK companies to get paid for the products and services they export by insuring against buyer default. 

Before exporting, make sure you are confident you will be paid, as you may face difficulty when accessing foreign exchange. Contact one of UKEF’s export finance advisers at: https://www.gov.uk/government/publications/find-an-export-finance-manager for free and impartial advice on your insurance options, or contact one of UKEF’s approved export insurance brokers at: https://www.gov.uk/government/publications/uk-export-finance-insurance-list-of-approved-brokers/export-insurance-approved-brokers.  

[Source – DIT: Exporting to Australia]


Currency risks when exporting to Australia

In order to fix your price, it is essential to fix your exchange rate. Before signing any contract, you need to consider whether the best option for you is to agree terms in Pounds Sterling (GBP), US Dollars (USD) or Australian Dollars (AUD). It may also be advisable to seek expert financial advice on exchange rates (FX).

[Source – DIT: Exporting to Australia]

Transferring money from Australia

In principle, capital can be moved into and out of Australia without any restrictions.

Currency transfer that amounts to A$10,000 or more must be reported to the Australian Transaction Reports and Analysis Centre (AUSTRAC): https://www.austrac.gov.au/

[Source – DIT: Exporting to Australia]


 

comments powered by Disqus

Contact Form