How to kick-start international growth

Following our feature on international growth in the latest issue of Agenda, we speak to one business that has successfully mapped uncharted territory and expanded overseas.

When expanding your business overseas for the first time, choosing which new markets to enter and which distributors to partner with are just two of the important decisions that could make or break your chances of success.

Here, chief executive at Harrogate Spring Water, James Cain, shares his insights from the Yorkshire-based company’s pursuit of international growth.

Tell me a bit about your company. Which markets do you operate in and what is the current scale of the business?

Harrogate Spring Water was started in 2002 with the sole purpose of producing a premium product of naturally sourced water from the British spa town. Harrogate’s mineral spring has a commercial history dating back to the 1500s, so we’re proud to be carrying on that tradition. The company’s roots are firmly based in food and beverage services, and today the sector remains the cornerstone of our business. In the 10 years since I’ve been involved with the company, we’ve gained a good reputation among our clients for quality of product and service. I’m really proud of the relationships we’ve formed and nurtured on our journey.

We’re truly a family-run, independent British business: my father is chairman and my wife is in charge of our marketing. We’ve strategised around different sectors over the years, but today we’re becoming more involved with airlines. We’re currently working with British Airways, EasyJet and Jet2, among others.

How and when did Harrogate Spring Water begin to trade internationally?

Around 10 years ago, in the early days of the business, a distributor from Russia approached the company, telling us the story of a Russian royal family who used to holiday in Harrogate because of the healing properties the town’s water was thought to have. Throughout history, spring water from Harrogate has been used for medicinal purposes and in the upper echelons of Russian society the town is still synonymous with royalty and famous for its water. We entered a supply agreement with that businessman and we’ve never looked back. Russia was our very first export market and we continue to trade very well in the country.

That experience gave us a good understanding of trading internationally. We have maintained complete trust and confidence in our Russian distributor, and that relationship has allowed us to understand what exporting is all about. It’s enabled us to go out and develop relationships in new territories. We’re now in 30 markets across the globe.

How would you describe your long-term international growth strategy?

We’re always getting out there and looking to enter new territories wherever possible. Our products are becoming very popular on trains and airplanes, and a major advantage of this is that our products enter new markets before we’ve even taken our business there. Visibility with airlines, in particular, presents opportunities. For example, one of the global airlines we work with is Cathay Pacific and we’ve managed to get picked up by several Asian customers wanting to distribute our water in Asia, because they found our product on their flight. Similarly, the owner of supermarket chain Lulu – one of the largest grocery retailers in the Middle East – picked up our product on a train in the UK and invited me out to Abu Dhabi to meet with him. Before we knew it we’d entered eight new markets across the region.

What are the challenges of taking a business international?

The challenge is always around choosing the right people to work with. When you enter a new market and you’re finding a distributor to give sole rights to, you have to absolutely ensure you have trust and respect for them, because that’s who’ll be representing your brand and business in that region.

The Department for International Trade (DIT) can make certain introductions and take you on trade missions – which I would recommend to anybody as a way to test the waters – but then it’s your decision to make. Can you trust this person to pay you on time? Will they deliver on their promises? Ultimately, the decision to hire them lies with you. At Harrogate, we haven’t always made the right choices and we have a few battle scars that show it. But now we absolutely ratify the people we work with to ensure they are reputable.

How overseas growth can enhance your business Find out more

What’s been the impact of Brexit on your international strategy? Have you entered new territories since the referendum in 2016?

Yes, we have. Brexit hasn’t hindered us in that way. We put a Brexit plan in place on day one and we’ve ratified our supply base to ensure we’re not going to be disrupted from offering a continual service to our customers. We also put a Brexit committee together, which has taken measures like additional stockholding and additional robust forecasting with suppliers.

What’s been the impact of going global on your business more broadly?

International trade has been good for us because it’s enabled continued development of our business. That has resulted in additional jobs, not just in our business but downstream in our supply chain. Beyond that, we’re driving tourism to Harrogate. Bottles that are handed out on a Cathay Pacific flight, for example, mean there are people in Asia who know about the town. It’s put Harrogate on the map.

What would your advice be to a business that’s about to trade overseas for the first time?

Don’t underestimate the paper work: there’s a massive amount of admin. Also, have absolute confidence in the quality of your product and manufacturing process, because once you’re exporting it’s very difficult to recall your product and make a profit if there’s a problem with it. Finally, choose your distribution partners wisely. Go out and meet, greet and get comfortable with them, because they’ll be representing you on a day-to-day basis.

For more on how overseas growth can enhance your business, read our feature on Going Global, from the Spring issue of Agenda magazine.

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