How Small Businesses Can Tap into Global Markets with Supply Chain Transparency
Small businesses have something that international companies desperately seek. And that is more visibility and control over their supply chain transparency.
Supply chain operations no longer happen insulated from direct consumer contact. The technology boom and the rapid-fire spread of social media have brought many questionable supply chain decisions to light.
According to the State of Fashion report, 66% of consumers say that they would stop or significantly reduce shopping at a brand if they found it was not treating its employees or suppliers’ employees fairly.
Large companies are just picking up the pace to clean up their key operations and processes. The pressure is on, but it also opens a door for more flexible small businesses to enter the global markets.
Find out exactly what steps to take to tap into the global markets by refining your products and services, updating your technology systems, preparing for long-term investments, and more.
WHY SUPPLY CHAIN TRANSPARENCY IS KEY
Supply chain transparency is part of a new era of information-based consumption where fair trade, fair treatment, and financial deals are fact-checked vigorously.
Businesses that don’t comply are starting to face increased scrutiny. Of course, there is a blatantly simple solution there: just clean up the supply chains in question. But the situation is not that simple. Many companies, while understanding the importance of transparency, may struggle to prioritize their action plan.
They’ll often get lost in never-ending risk assessment processes and legal jurisdiction evaluations. The longer they wait, the higher their chances of getting ousted and discarded by a growing number of conscious consumers.
One of the easiest ways for them to appease their customers is by relying on the help of small businesses with better supplier management practices.
STRATEGIES TO TAP INTO GLOBAL SUPPLY CHAIN AND MARKETS
If you’re a small business with a transparent supply chain, joining global markets could be a logical next step in your journey. Large corporations are seeking to partner with small companies that bring tremendous value to their entire supply chain.
They also bring along valuable niche products, quick turnaround times, and close customer relationships.
Let’s explore the best strategies that will help you catch the attention of international companies and other players in the global markets.
1. Focus on niche products
Large, global companies are hungry for the knowledge and market share of small companies specializing in manufacturing and selling niche products. These niche startups usually produce environmentally-conscious goods and come with clear visibility into their supply chain.
For example, Bee’s Wrap is a small business that created a wrap out of beeswax to replace single-use plastic.
Their supply chain and manufacturing processes are disclosed on their website. Bee’s Wrap is made in Vermont, US with beeswax that’s sourced from sustainably managed hives. The packaging is recyclable and biodegradable. It’s the perfect niche product for green-conscious customers around the world.
Bee’s Wrap predominantly sells to artisan food shops, but they have also expanded to supply large chains like Whole Foods, Nordstrom and Patagonia.
Have a niche product? Review it to see how you can rebrand it or make it more appealing to the global audience. Think about questions like:
- Can you go cruelty-free?
- Can you switch to organic suppliers only?
- What are current consumer trends? (think: Facebook IQ, Think with Google, or Nielsen reports)
- What are your existing customers saying about your product? What would make it better? Also, set up social media monitoring to get alerts and repurpose that content into other channels.
Remember, you don’t need to change your entire product roadmap to fit into the needs of a specialized market like this. Simply adjust and modify your processes where costs and capacity allow.
2. Create strong relationships in your network
The ability to create strong relationships with service partners is an intricate skill. Yet, it’s a must-have if you want to expand into global supply chains.
The most critical factor is trust. This may be hard to attain due to distance, cultural differences, or being a newcomer to the market. The great news is that you can overcome any doubts regarding your professional rapport by applying similar principles as you would in your personal life.
“Maintaining a relationship requires constant care and feeding, a bit like a marriage,” says Sherry Gordon, author of Supplier Evaluation and Performance Excellence in Industry Week, “Like any relationship between people, customer-supplier partnerships take time and effort. Ideally, there should be alignment between firms on the value of the relationship, business ethics, standards of excellence, and commitment to continuous improvement.”
Here are some actionable tips you can put to use:
- Look into cultural differences. Differences can clash on an individual, organizational and national level. Gain an understanding of customs, taboos, and even holidays.
- Be responsive and responsible. Don’t wait days to respond to email inquiries.
- Show you know the business. Suppliers and international partners find industry certifications and financial statements assuring your stability as a small business. Be sure to include these in your communications.
- Set processes that work for everyone. Do you prefer email? Slack? Zoom calls? Check in with your partners to get clarity.
- Go the extra mile. It’s good to set availability for each partner but don’t hesitate to jump in and help when they need something urgently. They will remember and appreciate the gesture.
Pro-tip: an equally important step when entering global supply chains is customer relationship optimization. Establishing smooth relationships will reinforce your spot on both sides of the table.
3. Plan in advance and well
A thorough plan in place shows a small business’ preparedness to enter global markets. It’s a critical element in building a resilient and flexible supply chain.
If you haven’t already, it’s time to invest in project management software and start keeping tabs on the many threads of your company’s services.
Here are a few points to assess:
- Create a new business plan with large companies in mind.
- Compile insights on undertaking high-risk agreements. Can you afford to accept longer payment terms? Are you able to invest money into technology upgrades?
- Set systems in place for emergencies. Disruptions to the supply chain can come in many forms, like pandemics (such as COVID), natural disasters, cyber-attacks, transportation issues, and more. Use a supply chain simulation tool to do an advanced risk assessment.
Pro-tip: copying how others in the industry manage their supply chains is not enough. Rely heavily on your own analytics and make data-driven decisions wherever you can.
4. Update your technology systems
During planning, all of your business’ technology needs will come to the surface. Updating your systems can assist you in more ways than you think. It could elevate your compliance levels, increase your response rates and help build transparency of your inventory.
It’s also a massive boost for your partnerships. B2B supply chain partners want the same easy ecommerce experience as B2C customers. Investing in the right tools is a step in the right direction.
Get inspiration from the following solutions:
- Try smart, integrated B2B ordering that lets global buyers see your inventory can make a huge difference to your revenue.
- Get anti-spyware software to prepare against virtual attacks.
- Use a free checker like OpenVAS to see all your current vulnerabilities.
Tech upgrades that benefit your customers:
- Online store hosting that can handle an influx of traffic is a precursor for competing globally.
- For many ecommerce apps, serverless databases can help streamline user experiences securely. Consult with your developers about switching to a serverless setup.
In any scenario, evaluate your needs and data first before investing in another technology. Prioritize affordable, big-impact tools first to ensure a smooth change of tracks.
5. Seek out reliable domestic exporters
You don’t need to do all the legwork in getting your product to global buyers. Partnering with reliable domestic exporters can save you from more work, yet, you could still provide a turnkey solution to multinational companies. It’s a win-win-win solution.
Exporters themselves can be small businesses. Surbhi Agarwal started her domestic exporting business, The Art Exotica, in Rajasthan, India. Her company is focused on helping women artisans in the region create and sell sustainable, eco-friendly products to global markets. She single-handedly helped revive and popularize a terracotta-like art form native to only a couple of villages.
How do you find a great exporter?
- Seek out members of import/export directories
- Perform a Google search for exporters specialized in your products with the keywords “product name exporters in your country name.” For example, handmade soap exporters in the USA.
- Attend trade shows and network with exporters or business owners with similar products
- Ask around your professional network for referrals
- Join export/import Facebook, LinkedIn, or Slack groups
Platforms like Amazon and eBay use internal figures to track the performance and credibility of their distributors. You can also do regular internal evaluations to check whether your partners are always on time, keep contractual obligations, and meet your expectations.
6. Enlist your bigger customers to help grow
Your final link to the global stage could already be in your circles. It’s time to dust off the CRM software of your choice and review your customer list. The referral or even the publicity of your partnership with a recognized company could set things in motion.
For example, digital payments company Square’s first big partnership came about with Starbucks. After that, Square’s success was set. They landed Whole Foods Market, scored multiple rounds of new investments, began trading on the New York Stock Exchange, and acquired several other services. Less than ten years after its foundation, Square has just banked $9.49 billion in revenue for 2020.
Sometimes, your big customer could come from the referral of a small one, too. Do not underestimate the power of any customer’s network.
Marketing agency, Peppercomm, decided to donate their expertise in publicizing the work of the Iraq and Afghanistan Veterans of America in exchange for referrals. Thanks to the exposure, the agency attracted a major multinational corporation trying to win military contracts.
“The work we produced for the nonprofit also won awards and enabled us to attract other large customers. Doing good will help a small business do very, very well,” said Steve Cody, Co-Founder to Inc.com.
Reach out to your clients and customers with a short, direct letter. Tell them that you’re looking to expand and currently open to help other companies in the field. You can also opt for the less direct route and simply go the extra mile next time you’re collaborating with one of your big clients. A really happy client will be sure to spread the word on your behalf.
7. Protect your interests and seek mentors
From time to time, a customer may be unable to pay. You can’t predict these scenarios, but you can prepare for them.
- Always have your receivables insured. Find an export credit insurance broker who can help you select the most cost-effective solution.
- Use a letter of credit to minimize risk. It is generally issued by the importer’s bank and guarantees that the beneficiary will be paid.
- Get an online legal service firm to review your existing compliance status across your systems.
- Run a full risk assessment on your supply chains
Other steps you can take:
- Arrange your copyrights and trademarks wherever due to combat copycats.
- Never respond to unsolicited email business offers from strangers. They may be fraudulent.
- Do not auto-pay any invoices you receive. Double-check any questionable sources with the Better Business Bureau.
Once your export/import management is in order, it’s time to up your marketing game.
- Create a marketing and branding strategy to position yourself as one of the leaders in your niche.
- Start creating content. Think beyond articles: videos, podcasts, infographics, memes can all help you get recognized.
- Draft up a social media strategy and get active on multiple channels.
- Find a mentor for your marketers to help them nail down your conversion strategy.
8. Invest and innovate in your supply chains and beyond
Warren Buffett was in high school when he and a friend bought a used pinball machine for $25 and installed it in a barbershop. The clientele loved the game, so Warren and his friend bought eight more machines for other barbershops. When they sold their venture, Warren bought stocks and launched more businesses. By the time he was 26, he’d accrued $174,000.
Reinvesting your funds into your company is a must for long-term growth.
Even big companies learn this lesson time and time again. Between 2013 and 2017, Best Buy’s sales were on a steady decline. Finally, by 2017, their reinvestment strategy started paying off. They have held down prices, gave better training to employees, partnered with Apple on repair services, and dove into home fitness tech.
Here are ways you can invest and innovate in your business:
- Review your entire supply chain. Do you see any weak links or bottlenecks? Products that regularly arrive damaged or poor quality? Research for better options and fix vulnerabilities.
- Invest in better inventory management software. Product availability information should always be well-coordinated and optimized.
- Consider expanding supply chain capacities by partnering up with new suppliers or adding a new product to your line.
- Introduce an omnichannel strategy like Walmart. They have recently invested in fulfillment capacity, supply chain management, automation, and technology upgrades to compete with Amazon.
THE GLOBAL STAGE IS WAITING FOR YOU
Small businesses can bring a horde of positive disruption to the big table. Simply hone in on your expertise, optimize your supply chain transparency, and reinvest your gains to catch the eye of the right business partners.
But before you get lost in the deep end of supplier relations, remember to keep your direct customers top of mind. Consumers welcome companies with authentic and transparent supply chain practices, as long as they are consistent about it.
You can rest assured that this trend is not going anywhere. It’s only going to get amplified as more people opt to support ethically sourced goods.
Now it’s your turn to start building a sustainable, future-proof business and permanently claim your spot on the global stage!
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