How to harness the power of going global
27 June 2018
Martin Davidian, Managing Director Sales, UK West and Ireland at FedEx Express
The digital economy has created many business opportunities which small and medium-sized enterprises (SMEs) are not yet fully exploiting. This is because they don’t receive the help and support they need to truly benefit from access to new markets and customers. As a result, many are struggling to go global in a rapidly evolving landscape.
As the world’s largest express transportation company, we work with businesses across all sectors, and understand the challenges they face when exporting goods. Consequently, providing an efficient and integrated supply chain is of paramount importance in helping small businesses achieve their international ambitions.
Physical and digital networks are merging and the world is becoming increasingly connected and competitive. Although some small businesses may thrive and profit, others may require additional guidance and support. Tapping into a network of trusted business partners is important, to gather additional support, expertise and guidance. As experts in connecting global marketplaces, this is where FedEx Express can come in – helping SMEs strengthen their international presence by providing a broad portfolio of transportation, e-commerce and business solutions.
Sometimes simply explaining what logistics is and what is involved can spark a new idea or make a small business more productive.
An example of a small company FedEx Express has supported is UK-based chocolatier Lauden Chocolate. Beginning life in the founders’ home kitchen, Lauden Chocolate needed a logistics provider which could deliver its temperature-sensitive products on time, and with the high quality of customer services associated with luxury brands. FedEx Express now transports Lauden Chocolate the world over, including to countries with hot climates.
Supply chain barriers
Even in a digitised, globalised world, supply chain barriers still exist. According to the FedEx SME Export Report 2017, most common business challenges include increased competition in other markets, accounting for (33 per cent*) along with increased production costs rated at 27 per cent**. In addition, a lack of capital and the idea of expansion may seem daunting for SMEs looking to expand their horizons.
Supply chain solutions
Support and expertise is so important when breaking into new markets, especially for first-time exporters navigating a maze of information and customs laws that need to be considered.
We understand practical knowledge is essential when considering global expansion and visibility throughout the supply chain is critical. Our research shows SMEs need convenience, flexibility and customs support to navigate challenges of the global digital economy. To help, we’ve compiled a list of tips for successful international expansion. These include why you should:
- Research your market correctly and consider the best means to ship your products
- Prepare your international orders with care, including relevant documentation
- Consider enabling tracking options to provide customer visibility and services
Thanks to the express transportation sector in connecting businesses worldwide, SMEs now have the ability to grow in ways not possible in the past. With the right guidance, these barriers can be broken down. At FedEx Express, we are committed to making it quicker and easier for SMEs to access markets across the globe.
For more information, please click here.
* “Global Trade in the Digital Economy: Opportunities for Small Businesses”, a commissioned research study conducted by Harris Interactive on behalf of FedEx, September 2016.
** “Global Trade in the Digital Economy: Opportunities for Small Businesses”, a commissioned research study conducted by Harris Interactive on behalf of FedEx, September 2016.
Welcome to Business Reporter supporting SME's campaign. I'm Alastair Greener. Winston Churchill once said, he who fails to plan is planning to fail. However, no matter how much SMEs prepare, errors will occur in the supply chain.
How can SMEs adapt and succeed in this competitive market? The managing director of sales in the UK and Ireland for FedEx Express, Martin Davidian is here to give us some advice.
Now, according to the SME health index, the health of SMEs at the moment in the UK is pretty low. So what can large organisations do to help them?
I think the first thing that larger organisations can do like, FedEx for example, is understand their responsibilities, and to take those responsibilities. As gatekeepers for the global marketplace with the knowledge and the experience they've got, understand and be prepared to share that and provide the access to small businesses to become a trusted network, and to become an advisor for them, and to do that unconditionally.
It's a digitised global markets today. So why are there still barriers in the supply chain?
The global economy superhighways is much bigger and more comprehensive now than it's ever been. But it's not finished. And actually, sort of creates the potential for a maze. It creates a potential for small businesses to get lost. With a great product that they may have, how they take that to market and the direction that they use to take that to market can be quite critical. And to take the wrong path, to use the wrong channel, could very easily take them down a dead end and actually end up with a failure, which it would be a shame when there's some fantastic products.
So again, it loops back to the large companies using the experience that they have to be able to provide that roadmap to these small businesses-- to provide them with the navigation tools to actually find the best channels.
What other examples have you got of the challenges that maybe organisations, SMEs, find as they're trying to work their way through?
We took a position where we wanted to understand the SMEs and the challenges they face. And one of the things we learned from the FedEx small business export server, 2017, was that if you look at the companies, the small business companies, a relatively small number of small businesses actually use or access market through mobile commerce or social commerce. And if you narrow that down to the European marketplace, we can see that 55% and 65% respectively, of small businesses are only using mobile comms or handhelds or social media platforms, Facebook, for example.
Whereas, 80% of them are using that more traditional route of e-commerce and the website [INAUDIBLE]. And the question we have to ask ourselves and be prepared to go to small business with, is that a missed opportunity? Is that a channel that, as a business, you should be looking at, because of the nature of your product or the target market you have? Are you better, are you going to be more accurate, targeting your marketplace through a mobile commerce platform for more social media platform, than you would through simply through a website and hoping that people are going to come onto that web site? Social media gives you a lot more immediate access.
Lets talk a little bit more about FedEx Express and what exactly is it that you do to help them get that clear route? How do you interact with organisations, smaller SMEs and so on, to be able to do that?
Well, the first thing I think I can say is that FedEx has invested significantly over the last few years in understanding that SMEs are the engine of the global economy. They're going to be driving the global economy. And its it's up to us to understand the challenges they face. And therefore, we spend an awful lot of time understanding about SMEs and the fact that these are often time-starved businesses. They're small businesses, they're small teams, they wear multiple hats. They have to undertake multiple tasks to running a business. They don't have huge teams of people.
Therefore, how we take those pressures away from them, how we support them, is quite key. We have a dedicated team for example, of small business advisors where small businesses can actually contact them either through our website, through chat, through telephone, and actually, if they're looking at trying to access a particular marketplace, they can ask advice, they can ask questions about the challenges that they may find-- what are the customs regulations? What are the things that they need to do to export there? We provide that advice.
Now, ideally, we'd like them to use FedEx at the end of that, but the primary role of that team is to provide advice, not to sell. So that's one way FedEx helps the small business to navigate their business journey.
We all know that the customer is king at the end of the day. The customer has to come first. So what is it that you do that enables you to really understand a customer's values?
I'll give you an example of a company that we've worked with and supported. It was a husband and wife team. Their award winning chocolate company in the UK. They started by making chocolates on their kitchen table in their home in Leeds. And now, they basically sell to premium, premier retailers around the world, and Michelin Star retailers around the world a very specialised handmade chocolate.
We started working with them to understand, first of all, the uniqueness of their product, and the very high-end market that they were trying to access, and the demands that that high-end market would put on their business. And then from that, we were able to tailor a solution for them that, A, met their customers' demands through using our international priority service, for example, which is next-day product to most countries in the world.
We link that with our time sensitive and temperature sensitive monitoring capabilities. And then we tie that into our customer services team to provide almost a 24-hour monitoring service to allow them to have the security and the knowledge that their product was going to reach their customer in the condition it left them, and presented to them in the right way. Even to countries where temperature was a problem. We have hot, hot countries where chocolates aren't exactly the best product to send. We were able to help them access those markets very successfully.
We've talked a lot today about the relationship between SMEs and large organisations. If you wanted our viewers to take away maybe three key points of how to make the most of that relationship, what would they be?
Get your trusted network, get your advisors, know which big companies are out there, like FedEx that can provide it. Understand the channels that you want to take your product through, whether it's mobile com, social media, or the traditional e-commerce route. And having got your network of advisors and the information, having chosen your channel, make sure that you then do your research and get the right logistics provider. Get the right carrier person to deliver your product, because the first two are lost if the third one isn't right.
It's clear that for a SME to be really successful that relationship between SMEs and larger organisations is critical. So it's been fascinating finding out how that's possible and how to make the most of it. Martin Davidian from FedEx Express, thank you very much, indeed.