Will the transition period alter the way you select new export markets?
If you're anything like me you will have a system for researching, identifying, prioritising and ultimately selecting new export markets. Mine is called a Gateway system. Whilst bespoke for every company I work with the principle and process is the same. So, as the UK enters the transition period the outcomes from this system may be different but the process remains.
Why is this?
The criteria I look at falls into different categories. For example in one initial category data on issues such as regulation and legislation, import duties and administration burden. Another category would include sector activity, economic activity, political stability, demographics etc. Whilst the significance of these latter criteria will not change, the impact of the issues in the former category will alter change depending on the outcome of the negotiations the UK concludes by the end of the transition period.
For example if we take regulation and legislative criteria, currently the UK is fully aligned to EU legislation. The signals coming out of the UK government at the moment are that they will place more importance on autonomy than alignment to EU standards. It is therefore possible that British firms have to run additional compliance systems for exports to EU markets. As a further example if a tariff free agreement is not struck then import duties may become due when EU customers bring in British made product to their markets. Now, whilst these issues may not necessarily be deal breakers for entering a certain overseas market, it may well impact where EU countries finish in the priority list when selecting your next target export market.
This demonstrates the importance of having a system for researching, prioritising and selecting export markets.
Naturally there are many other considerations to include. Every time Your Export Department undertakes a market identification project for a client, criteria specific to that particular client are used. The important thing to understand is what makes an export market attractive to your particular company and then implement a process to search out the overseas markets that have those attributes.
Leaving the EU may throw up a few surprises in your priority list. Trust your system though - so long as you are using appropriate criteria you will find the most suitable markets for your export growth! Good luck and if you need any help give us a shout!