Tuesday, August 22, 2017

From Local Production To Global Consumption

Nigeria is just emerging out of recession which bedeviled our dear nation because of the challenges of over dependence on Oil. There has been so much noise and some steps towards diversification into other sectors like Agriculture and Solid Minerals, but little or no campaign on the need to add value to the commodities from these other sectors for exportation. We live in a very interesting continent where we produce what we don’t consume and consume what we don’t produce. Nigeria for example is like a man that earns N50,000 a month and spends N70,000 every month with about N500,000 in his savings. Such a man will only survive on this equation for a period of just 25months, this means that in two years, he will go bankrupt. The lesson from this story is that, going global is not just about you, your family or your business; it is about the survival and revival of the economy of this great nation. So even if you were not thinking about it before, please begin to do something about it for the sake of Nigeria.

First of all, I will like to say that going global means that you will need to rise above the low standard of our environment in order to favourably compete on the global scene. However, this has been an herculean task for Nigerians and indeed Africans because of the very low standard that we have accepted to comfortably live with as a people. You buy plantain in traffic and you are very okay with it as it is, but that is not acceptable in the international market. You will need to consider packaging, labeling, constituents, nutritional facts etc. before it can enter the international markets like United Kingdom (UK), European Union (EU) and the United States (US). It is very sad to note that, many people are doing business just because of money for survival, they are therefore comfortable remaining in Nigeria and never think of export because there is no vision beyond comfort and convenience.

Please make no mistake, when we talk about going global through export business, it is not just about tangible products, intangible services can also be exported like consultancy services, training, technology, entertainment etc. So you can export just about any product or service that help the way will live and work as human. When we talk about going Global through export business, I do not mean export of commodities that can only be used by a few that have the technology to convert them into finished goods. It is the people who convert commodities to finished goods that takes the glory of global recognition. If you export cocoa only, you will only be known and rewarded by the very few people in the cocoa industry, but if you export chocolate, you have a global market with many consumers in many countries and hence a global recognition.
It is also important to note that, going global through export business does not mean exporting to only the people of your tribe and tongue in a foreign land. I mean developing a product that other nationals will be interested in. That means it must have overcome the challenge of Acceptability and Adaptability for use in any country.

The possibilities of export are almost limitless. It is going global through export business that made the tax paid by just about 15 Fortune 500 companies to surpass the national budget of over 170 million people in Nigeria. It is going global through export business that made a Nigerian brand Olu Olu foods to make over N250 million turnover a few years ago just selling plantain chips in the U.K. It is the idea of going global through export that makes a company a global brand and hence earns the country of export a goodwill. It is going global through export business that will get us out of the current foreign exchange shortage and financial mess that we have found ourselves In order to go global through export business, a company must strategically and progressively transit from local production to global consumption.

In order to do this, the exporter will need to focus on five areas and these include preparation, product, process, problems and possibilities.
1. Preparation – Be Prepared. As you plan to transit from local production to global consumption:
• Be prepared to learn the ropes and invest in market research
• Be prepared to live by great values and vision
• Be prepared to look for trading partners
• Be prepared for legal documentations and protection
• Be prepared to labour in search for information
• Be prepared to launch new product designs
• Be prepared to leverage on the African taste
• Be prepared for lawsuits – if quality is compromised
• Be prepared to lead the competition or competitors
• Be prepared to leave your comfort zone and visit the export market

2. Product – Upgrade your products- food, apparel, raw materials & finish goods. As you plan to transit from local production to global consumption, you need to upgrade your product to stimulate a positive response from the buyer:
• Upgrade your product through a suitable packaging (details on the pack ...)
• Upgrade your product to serve the new market demands (quality and quantity)
• Upgrade your product to separate it from the competition (unique selling point?
• Upgrade your product to showcase the features and benefits
• Upgrade your product to settle quality issues of African products
If you do not have a product do not just focus on commodities, look for countries where you have competitive advantage by virtue of network of relationships you have there, do a research to identify products in high demand and then look for companies that can do contract production for you or partner with them to be their sole distributor for that product abroad.

3. Process – Understand the process. As you plan to transit from local production to global consumption:
• Understand the process of promotion- (trade fairs, chambers, agent, distributors.)
• Understand the process of obtaining purchase order- (FCO, Incoterms.)
• Understand the processing of paperwork and regulations
• Understand the process of payment and methods- (LC, BC, AP, OA, SBLC, GTE)
• Understand the process of prosecuting piracy

4. Problems – Handle the problem. As you plan to transit from local production to global consumption, learn how to:
• Handle the purchasers/partner problems- (bypassing you to your producer.)
• Handle the pricing problems- {depending on the delivery terms (Incoterms)}
• Handle the product problems- (batch/lot number for isolation)
• Handle the payment problems- payment (using secured payment methods)
• Handle the paperwork problems- (pre and post export documentations)

5. Possibilities – Position for possibilities. As you plan to transit from local production to global consumption, position yourself for the possibility of:
• Repeat business from same buyer
• Referral to other buyers
• Replicating the business model in another country
• Redeeming the country's image
• Recruiting multiple partners
• Rebuild broken bridges between nations
• Raking in more income than your projections

In conclusion, let me state at this point that, a product is not global because it is abroad unless other nationalities are patronizing it. So, if your product is being sold abroad and only Nigerians are buying it, the product is still a local product even though it is sold in countries abroad. If we want to create enduring wealth for our children, if we want to create extensive wealth for the country, if we want to create everlasting wealth for the continent of Africa, transiting from local production to global consumption is the way to go!

From questions and feedbacks kindly send an email to bayemibo@3timpex.com

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