Confidence, courage and calculated risk: Key ingredients to going global

Being a successful entrepreneur means taking risks. That’s true at every stage of your business, from start-up to making the decision to expand internationally. Entrepreneurs are sometimes characterized as risk crazy. But what we really are is risk friendly. My experience growing my own company and investing in other people’s businesses on Dragon’s Den and through my venture capital fund, is that successful entrepreneurs learn to take calculated timely risks. 

For many small and medium-sized enterprises, the decision to take your business international and start exporting may seem like the biggest risk of all. But it doesn’t have to be. In fact, there has never been a better time for Canadian businesses to shine on the world stage and take advantage of Canada’s excellent reputation for high-quality goods and services.

Over the years, I’ve learned a few lessons about what it means to take a calculated risk. Here is how I would apply those lessons when it comes to getting your business ready to export.

When it comes to exporting you need to know what you’re doing before you jump into international business That starts with learning about the markets you want to enter; specifically, who are your customers and competitors? Your competitors in a new market are likely well entrenched and will be different from here at home. You need to know who they are and what they’re offering that makes their businesses successful in that market. Likewise, your customers in a new market may not be the same as the ones you have here, and their buying decisions may be motivated by different factors.

In addition to customers and competitors, you also need to research all the dynamics of your target market and what impact they will have on your costs and profitability. This can include everything from labelling requirements and how distribution networks function to the regulatory environment for your products and services and taxation. Finding the right local partners to help guide you through these issues should be part of your preparation.

Knowledge and preparation on their own aren’t enough. You’ll need to ensure you have enough working capital to follow through on your export plan. Beyond financial capital, there is also human capital. Do you have the right management team and staff with the skills, expertise and commitment to carry your plan forward? Be honest with yourself about your weaknesses and make improvements.

I’ve been most successful in my own business when I’ve found great partners to rely on. That’s especially true when it comes to doing business internationally. As I said, finding the right local partners is essential to help you navigate all the complexities of a new market. 

A true partner is one that will work alongside you to help grow your business and do more than just provide one-off advice. A great example of that is how EDC helped Chris Emery and Larry Finnson of OMG’s Candy arrange their financing, so they could take advantage of a major opportunity with a big U.S. customer. When Chris and Larry came on Dragon’s Den more than seven years ago, they had no sales, but they did have a $7-million purchase order in hand from Sam’s Club, a division of retail giant Walmart. EDC worked with their traditional lender to extend their line of credit, so they could purchase the raw materials they needed to fill the order. It was a major turning point for OMG’s and it happened because EDC worked as their partner.

I believe there are two things you need to be successful in life: confidence and courage. After you’ve done your market research, secured the working capital you need and found the right partners, you still have to make the “leap across the chasm” into exporting. This is where confidence and courage come in.

When you have confidence in yourself and the courage to try something new, you will do amazing things. You’ll feel empowered, like you can take on the world. 

I go back to when Chris and Larry from OMG’s came on Dragon’s Den. They had no sales at that time, but they had confidence in how good their product was and the courage to try and compete in the very crowded U.S. candy market. Today, they have sales of more than $50 million and they’re one of many Canadian exporters capitalizing on Canada’s good reputation for food safety and traceability around the world. Their goal is to make OMG’s a global brand and their confidence and courage will be key ingredients to making that happen.

Understanding and managing the risks your business faces in a new market is central to your export plan. EDC can help you through the process with expert advice and resources, like the guide to managing risk for exporters. Like the old proverb goes, “You can’t take two leaps to cross a chasm.”