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How to grow an international business during a global pandemic
Errol McClelland, founder of TurmeriX.
Tue 31 March 2020 - 7:13 amFeatured | Small Business
Expanding internationally always has risks but developing a business during a global pandemic is not usually a central part of a risk management strategy.
The global nature of the COVID-19 outbreak has given international businesses an unprecedented challenge, one that requires diversification and resilience.
Here are a few ways you can mitigate the pandemic risk if you’re globally exposed.
Secure your supply lines
If you’re importing and/or exporting product, make sure you’re on top of your supply lines, both in terms of securing the inputs you need to create your product and the logistics to move stock around the world.
TurmeriX is a health supplement and we source spices from around the world that we blend and pack in Melbourne before sending it to distributors worldwide – we need to ensure production meets worldwide distribution targets. When we realised there would be a global disruption, we checked in with our ingredient suppliers, who were all still able to meet the quantities we required, and we looked at our global distribution channel.
At the moment we’re not seeing a huge difference in the logistics side of things as goods are still moving around the world. While some ports were initially closed temporarily, which meant some shipments were delayed, some of our partners have decided to import using airfreight instead.
Pivot the sales model
One of the things we looked for when we started offering retail licences in other countries was the nature of the sales channels the distributors could leverage. TurmeriX started at local markets here in Australia and the educated sales we get from direct selling at markets and expos represent a significant portion of our revenue so it’s no surprise that our overseas markets mirror this.
A recent victim of the COVID-19 precautions was the Ideal Home Show in London, which we were to exhibit at. The show is one of the longest running exhibitions of its kind, and it was supposed to have run from 27 March to 13 April 2020. That represents a significant drop in sales volume for our UK/Europe distributor, so we have encouraged him to bolster TurmeriX’s online presence there as this omni-channel approach has worked well for us.
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Similarly, we chose our North American distributor based on the fact they had 35 years’ experience in direct selling. Because of the nature of our product, however, a month ago they hired a business development manager to open up other channels for them, which has worked out well for timing. Events comprised the biggest percentage of sales in the US and Canada, and now they’re looking at a few months of event cancellations. Who knows if the Calgary Stampede – a huge event for TurmeriX – will go ahead later this year? In the meantime, they’ll be strengthening their online sales channel.
Every international market has localisations, so when entering a new market we work with the partner on the ground to ensure our digital profile is properly localised and competitive.
Communicate and educate
The best way to build a good relationship is through honest and open communication, and a global partnership is no different. As the global licensor, I want to know what’s going on with the licensees in each region to get ahead of any potential issues, whether or not it’s related to a pandemic. We can then assess the challenges together and address them.
Some markets may have issues specific to the region, whereas a global event like COVID-19 and the cessation of public gatherings has affected everyone. We are collectively working on various solutions; what works for one distributor may give another the confidence to try something similar in theirs. We saw our ecommerce channel gain traction in response to physical distancing measures so we’ve encouraged our global partners to invest more effort and marketing into that channel for the time being, for example.
In addition to initiating regular contact, I also offer training via videos, which helps licensees attain a sense of what has worked for me. I trust them to bring their knowledge of the local customers to the table and to figure out what aspects of the training apply to their market but in general it’s really about having a willingness to learn and there’s plenty we can learn together as we navigate a new world environment.
No one ever says going global is easy at the best of times but during the uncertainty brought on by a global pandemic you can be forgiven for considering international expansion a future dream rather than a present reality. It’s not impossible, though, if you first secure your supply lines, and then help your global partners find the best solution to meet the changed market paradigm.
Errol McClelland is the founder of TurmeriX.