Niche, import, export, e-commerce, etc.. Look up any online forum or article about these terms, and you’ll be presented with a bevy of statistics that measure success by the total revenue of general product categories.
While this is good information for governments and university assignments, it does little to help you evaluate the most profitable product possible for your actual business.
Because unless you plan to launch a giant operation with a broad product base and a budget that will enable you to “out market” the established competitors in the field, a plan to export the overly general product categories of “Textiles” or “Machinery” can get you nowhere.
In addition, you must consider the unique combination of talent and connections that you have in hand.
For instance, a chart might say that your country is currently the world’s largest exporter of electronics. But if you’ve got access to a well-appointed garment factory and renowned clothing designers, then it might make more sense to explore a fashion business instead.
(Source: QuickandDirtyTips)
After all, you’re not looking to corner the entire exporting market for a country. You can still be wildly profitable and make millions by slicing a smaller segment of the pie.
Now this isn’t to say you should ignore all of the world trade reports. It’s just that you should only use those statistics as a basis for – not the final factor in – determining which products to export.
And many business experts agree that starting with a niche at least gives you an edge over the “big guys”, and more importantly, allows you to create a stable and loyal customer base.
While this guide is aiming mostly at the newly established entrepreneur who’s trying to decide which products to export, it’s never too late to find a new niche – even if your business is already up on the run.
So for exporters old and new alike, here it goes!
3 Ways to Find Your Niche
Sell “YouNiche” – or Unique – Products
If you come up with a product idea that solves a real world problem… and so far nobody else is (or very few are) selling it, then you’ve found a golden nugget of a niche. Such was the case for the Latvian company Sidrabe, forced to diversify after the country won its independence from the Soviet Union.
It took a few years of research and development to get it right, but now the company (renamed Groglass) makes “invisible” glass that is exported to more than 45 countries and returns annual profits of EUR 9.96 million (not bad at all for a niche!).
The anti-reflective glass is used in art framing, television screens, supermarket refrigerators and modern architectural and design. What’s impressive is that there are only 4 other companies in the world that manufacture this product (!), and Groglass alone has cornered 70% of most countries in the European market.
But don’t think you have to achieve such major engineering breakthroughs to create a product niche. Others have found modest success with much simpler inventions, such as an elegant multifunctional notebook, a sleek 3-in-1 bicycle, and tasty dried mealworms.
->> Lessons from 3 small-scale e-Commerce success stories
Aim at Uncommon Importers
While your competitors might be focusing on selling products to all the usual importing countries, you might benefit from courting buyers in less common import countries.
Not only will it lower your competition, it could raise your bottom line as well. Some countries will even try to compensate for their lack of attention in the marketplace themselves by lowering trade tariffs, to make it more appealing for exporters. For ideas, take a look at these least expensive import countries.
So even though most statistics suggest that China is a leading import country, you might find a niche buyer in smaller neighboring countries in Southeast Asia like Vietnam, Malaysia or Singapore – those who might not even appear on the charts. Your transport costs will go down and you’ll face fewer competitors as a result.
Elevate your Standards
When you’re selling a product in a market that is oversaturated, you need to find a way to differentiate yourself. And appropriate as it might sound, sometimes creating an entirely new niche product just isn’t the right course.
If you find yourself in this situation, consider differentiating your business by setting niche standards. Things like quality certifications (i.e. Certified Organic, Grade A, etc..) and even the way you do business (i.e. Fair Trade, eco-friendly practices, etc..) can help create demand where there was none before.
For example:
- Kuber Grains & Spices Pvt. Ltd. uses an innovative low-temperature grinding technology (ITG) to preserve the volatile & peculiar oils in its spices – setting it apart from the competition.
- Pro Trade International offers cocoa certified by all four major certifications (UTZ Certified Good Inside Program, Rainforest Alliance, Fairtrade International FLO-CERT, Fair Trade USA), and it is a member of Sedex – the Supplier Ethical Data Exchange.
BONUS CONTENT: Niche DIY Example
Now that you have some ideas on types of niches, let’s put it all together with the research.
The International Trade Centre (ITC) offers many resources to visualize the big picture with data – which can be very useful as a jumping off point. Here’s an example of how you could use their Export Potential Map combined with some creative thinking, to hone in on your niche. Take a look at this table:
As you can see, the potential for exporting sugar products from India to Greece is huge. There is $23.3 million to be made! This is the first breadcrumb in our niche-finding trail.
Now we turn to Google. A little online research reveals that sugar beet is already grown in Greece, and the country has a history of offering aid to farmers with the goal of reaching self-sufficiency. Based on this information, it sounds like exporting sugar products to Greece is not a very good long term business plan after all.
But before you dismiss this sweet crop, let’s get a little creative. Here’s where niche thinking really comes into play. Go back to step 1 and ask, “What problems are associated with beet sugar that I could solve?”
For starters, it is seen as being an unhealthy product by a consumer market that is increasingly concerned about universal issues like genetically modified organisms, food processing and the glycemic index of certain sweeteners. No matter how much beet sugar Greece can produce, it will still have a need to import alternative sweeteners if its consumers demand them. Luckily, India has an agricultural sector that is teeming with potential solutions and niche exports.
(Source: IndianExpress)
Take coconut sugar, for instance. In many consumer publications, it is trending as one of the healthiest sweeteners with a low glycemic index and naturally occurring minerals. In India, one hectare of coconut palms can produce 54 metric tons of coconut sugar, per year!
But that’s just one possible niche. If you don’t have access to a coconut palm farm, you could try exporting agave or stevia, two very popular beet sugar substitutes grow easily in India.
BOTTOM LINE
Try out some of these niche-finding techniques and let us know what worked for you! Are you already exporting a niche product but still experiencing difficulties? Let us help you right now.
->> Tramping down import/export barriers for a smooth business expansion.
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