How can we choose the best product to import?
In this article of Sindbad we are trying to show different steps of finding the best product to import and how to be successful in this field.
Ways to choose the best product to import
To be a successful importer, you should be aware of the buyers’ characteristics and the strengths and weaknesses of your competitors. You need to collect the data that are relate to your competitors’ product and alternative marketing strategies that they use to meet the needs of their customers. Of course, you can start the import process without research; but research reduces ambiguity and provides information that can be used to make decisions at the beginning of the work.
After identifying the product that you want to import, you should know how this product is offered in the country. You have to identify the target market and try to understand whether the other businesses sell similar product to the target market or not. Through searching determine what your competitors are selling, how they are selling, which pricing programs they are using, how their product advertising is, and what distribution routes they are using. The aim of this chapter is to show how to select imported products and use available tools for research in order to better understanding of the customers and the competitors in the market. We will demonstrate how to identify your imports’ target market, how to look for a trade show with commodity business centers in your area, and collect what kind of data to become a successful importer.
Identifying the characteristics of potential buyers
Having a correct understanding of the features of target market is the most significant issue that helps you to choose the best product of the market to import. Market searching starts with identifying the market. Target market is a part of whole market that includes particular group of people that you will focus on them. Market is made up of the people or organizations with some needs to be met that have the authority, desire and satisfaction to enjoy the products you sell. There are two type of markets: customer market and commercial market.
Customer market includes the people who buy the commodities for their personal uses. Commercial market includes the organizations that buy the commodities in order to produce another products, to resell them to other businesses or the customers or using commodities in their commercial activities. All the customers in customer business or commercial business have these three characteristics.
- They have special needs. People have a variety of needs, including basic needs for survival (food and shelter), rational needs (reliability and durability), emotional needs for security, friendship and acceptance.
- They have enough money to buy what you sell. Just because someone needs something doesn’t mean that he has enough money to buy it.
- They have the power of decision making for what they buy. Search for the people have the real authority to choose and buy your products.
According to these characteristics, the duty of the person as an importer is answering to following questions.
- What needs are met by my product or service?
- Who needs what I offer and is able to buy it?
- Who has the authority to accept my product or service?
To answer these question you should do researches on market. When you understand that what your target market is, you can get more information about customers’ specific characteristics paying attention to their favorites, ages, traditions, degrees of education, genders, family statues, and careers.
Undoubtedly, a very important part of market research and identifying the best product to import is knowing your competitors. Being aware of the strengths and weaknesses of specific competitors can help you in recognizing problems and opportunities that you should consider in your commercial. Being aware of the right and wrong consequences of competition, and the cost that your competitors charge for their product or service can greatly enhance your commercial. In the following part, we refer to type of your required information, lead you to some journals and explain how to behave as a detective in trade show and commodity markets.
The other issue that should be considered in choosing the best product and market to import is achieving the best information. Markets should be examined in terms of a variety of competitive factors. In the following part we are going to have a brief explanation of these factors.
The number of competitors in imports
If you find lots of competitors in a market, you may change your focus and try to look for other products.
Competitors' market share in the imports
It means the share of all of the one product’s sales in a special period in a particular market and by a specific corporation. Market share tells you if the market is dominated by a major player or not. If there are some corporations who have major share in market, you may decide to focus your efforts on another product or market. Or you may realize that the costumers are searching for other choices because they are not satisfied with the corporations that are controlling the market.
If you realize that the market is dominated by many corporations or a few big corporations, focus on a proper and specific part of market that may not be as big as your target market but it may be more beneficial. For example instead of focusing on ladieswear, try to import Sari, traditional women's clothing in India, Pakistan, Bangladesh, Nepal and Sri Lanka.
Identifying competitors' marketing strategies
Your competitors in a market may have been working in the target market for a long time comparing with you and surely they have more effective information than you about the market; therefore, they can identifying competitors' marketing strategies better than you. Identify product, pricing, advertising, and distribution strategies.
Reviewing competitors’ advertising
Advertising is what a company uses to inform, persuade, and influence the offering product. Without advertising no corporation can compete in today's competitive world. At first, identify you’re your successful competitor, then try to examine and analyze their advertising strategies in target market and the advertising efficiency.
Quality of competitors' products
The quality of the products and the commodity that you are going to offer to the market is the other factor that should be reviewed. To this aim, try to have a comprehensive review of the quality of your competitors' products in advance and compare it with the quality of your products. Try to answer these kind of questions: how your products are being compared? Is the quality important? If yes, can you set a higher price for a better product? If the quality of your product is lower, is it cheaper?
Do they use the influential price slippage strategy? Price slippage means entering market with high price and emphasizing on the profit. To enter a competitive market you should have accurate and complete information from the price of your competitors’ products. Improper pricing, according to the market and the customers and also the quality of the products can disrupt your profitability anyway.
Competitors’ distribution policy
What kind of distribution do your competitors use? Do they interact directly with customers and business buyers or do they use intermediaries (wholesalers, retailers or industrial distributors)? Do your competitors give discounts? Do they ship, charge shipping, or accept long-term payments?
The scope of market coverage by competitors
The other factor that you should consider about your competitors in market is the scope of influence and work. This consideration may show what they have missed and it can be an opportunity for you.
How can we analyze our competitors in import part?
One of the most important steps to enter a competitive market is analyzing the competitors. If the analysis have been done correctly, you will get very helpful information about your advertisement, price, quality and customers. To do a proper analysis you can do following steps:
- Make a list of your main competitors
- Classify competitors based on their abilities
- Determining your weakest competitors
- Make a list of the competitive changes you expect in the future
- Specify the following for each competitor in step one
- Competitive ability
- General marketing strategy
- Its offered products and their strengths and weaknesses
- The way it try to sell its products. if it uses its sales force or uses the services of manufacturers' representatives
- The parts of the market that it sells its commodity to them
- Type and amount of advertisement or the other means it uses to increase selling
- Pricing strategy
- Any reason for buyers’ preference to the products of a particular corporation
- Whether the competitor make an opportunity or limitations or not
Research in the trade shows and trade centers
Whether you are a corporation looking for a way to expand your business or an entrepreneur trying to start importing, your corporation is in a precarious position. The market is constantly changing,companies are always introducing new products or using new marketing strategies. To be successful, you need to know what is happening in that part of your industry.
If you are importer, you can do many things by participating in trade shows, visiting trade centers of domestic commodities, and having conversations with potential customers. In these places, corporations try to sell the commodities that are similar to what you want. There is no place better than here for you to achieve needed informations. These kind of researches are not time consuming, complicated and expensive.
Trade show is an exhibition organized so that companies operating in a specific industry can exhibit their products and services. A trade center is a permanent center or marketplace that hosts trade fairs for manufacturers with regional wholesalers; main purpose of them is to have connections between the buyers and producers and wholesalers.
It is not recommended to invest in these exhibitions with renting a place and setting up a booth for selling your products. Rather, our goal is more to visit trade shows as a guest and gather information like a detective. There is nothing illegal, immoral or unfair about visiting a company booth that sells the product you want to import.
Commodity trade center is a kind of permanent exhibition. A specific trade show that is held once or twice a year. While commodity trade show is open all over the year, it is likely to be on schedule. If you lose a trade show due to time interference, the trade center is a good choice for you. What you should do there? During visiting trade show and trade center you should gather as more information as you can about the product that you want import.
Remember that you are not in a trade show to offer commodity but you are there to gather information about the product that you want to import and get to know the way that these products are being offered and distributed in country. Identify distributors of the products that are similar to your products and do following activities while visiting:
- Identify their marketing strategy. What is their product composition? How do they price their commodity? What is their advertising program? And how are the commodities distributed?
- Check the quality level of competing products. How are products presented in the exhibition or commodity market? Is quality an important factor in customers' decision making to buy?
Write down any differences between the products that you want to import and existing product in the market. You may have some opportunities in market (for example less prices, better quality, product unique specifications). Try to be keen speaking with people in trade show or trade center. You shouldn't go there saying “hi, I am going to import the products similar to your products”. You should act like a detective. In some cases you can get the most information by saying that you are interested in buying the offered product. In following part there are some questions that you may ask:
- What are the specifications or features of this product?
- Where is this product made?
- What is the latest product offered?
- Where are your products distributed?
- What is your pricing policy?
- Do you sell by credit, give discounts or have promotional motivators?
Ask for brochures and price lists. After initial conversations, if you feel comfortable with the people you talked to, you may ask more detailed questions such as the following:
- Who are your suppliers and are you satisfied with them?
- do you think about change your suppliers? “I have a similar product and want to import it from some country, I like to have an introduction session in your office, if possible” You can also state.
- Which factors do you consider deciding to buy a product? Try not to take people's time too much. Be a keen audience and pay attention to people's body language and tone of voice. The aim is gathering information not bothering others.
The last word
Importing a product, like exporting it, can be full of tortuous paths and make you unable to achieve your goals. To avoid such problems, it is better to do a thorough research on the target market, competitors, customers, product and its future. In this article, our efforts is to show you how it is possible to choose the best product to import.
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