To have success on the EU market, you need a product that is either unavailable or difficult to source in the EU (for our company this is clay for high-tech porcelain tile, or porcelain stoneware).
The key parameter for European consumers is not the price, but rather a guaranteed consistent quality of product and on-time delivery of want they want.
How did we find customers, and how do we retain them and find more? We employ a package of marketing events and tools for this. Of course, we analyse the market to see who might need our clay. We participate in all major stoneware industry expos — this is where our customers can be found. We collect information about the status of not only existing stoneware factories, but also where new ones are planned or under construction.
The first contract is crucial for winning your customers and the market. Your reputation in the market depends on performance under this contract. You might need to undertake additional efforts and incur unexpected expenses with your first contract, but it is better to do all it takes to deliver on your promises. If you do, trust in your company grows and you enter into your next transaction, your next customer relationship, with a reputation and a positive track record.
Personal contact is always an advantage, as well as the ability to speak the customer's language. For example, our export sales managers who are hired with fluent English are also sent to learn Italian and Spanish, as Italy and Spain (80% of our sales to the EU) are global leaders in the production of porcelain tiles.
The supplier's reliability is crucial for European countries. This is especially true in our case, because we supply raw materials, and the reputation of our consumers, the factories, depends on the timeliness and quality of our deliveries. All our maritime deliveries to the EU used to pass through the ports in Feodosiya and Mariupol. However, we have regularly considered the potential of other ports and how effective it would be to ship through them. As a result, in spring 2014, after evaluating all the business risks, we promptly shifted our deliveries from Crimea to ports in Illichivsk and Mykolayiv. The situation with Mariupol was similar. Seeing what was happening to the railway, we concluded a contract with Berdyansk Port and managed to restore freight traffic in only three days. In addition, we increased the stock of raw materials at the dealer's warehouses in response to consumers' concerns about the consistency of deliveries.
In addition to practical business decisions, openness is important. Regular communication with the customer enhances trust, and it is reassuring to see a contact in person. The important thing is not to keep silent. Every email you write or call you make builds trust.
The strategy of cooperation in European markets involves transparency. If you suggest a "scheme" in Europe, you lose the contract. Forget about shady or shell companies in your operations, or asking for money to be sent hither and thither. Europeans do not understand this. The customer should know who the producer is, how and when the product will be delivered, and when and to whom the payment should be made. Be honest and transparent.
And, most importantly, you will have to change! Any sales and management system that is not transparent will have to be overhauled. You will have to create an appropriate system of communication both inside the company and with third parties (suppliers, contractors, customers etc.). Only by making your customer relations transparent can you become the reliable partner that Europeans will want to deal with. This will be your first step toward success!
Olga Frusevich, Financial Director at UMG, sharing recipes for success in EU markets.