We would like to present to you a free tool that is useful to do a macro analysis of foreign markets.
The tool is the Comtrade, made by the United Nations. It allows to see import and export for every country in the world, divided by HS code.
So, first of all, you have to find the HS code of your products. It could be one, or more if you sell products from different categories.
WHAT FOREIGN MARKET COULD MORE ATTRACTIVE?
Thanks to Comtrade, it is possible to understand what countries in the world are the largest importer of categories of products.
You can do it in a few steps described below with an example: a producer of chandeliers.
- Enter in Comtrade website: https://comtrade.un.org/data/
- Frequency: for a macro analysis, it is better to analyze the annual data. Monthly data makes the analysis longer are confusing.
- Periods (year): we would suggest to select 3 years of more. In the example, we exported the data of 2019, 2018, 2017.
- Trade flows: select “import”
- HS Code: insert the HS Code. In our example: 940510 Chandeliers & other electric ceiling or wall lighting fittings.
Note: for some countries, the data of the last year are not always available. We suggest that you continue the analysis despite the missing data because it may take months before all data are available.
Then export the results on Excel. We suggest to order and visualize the data as we have done below.
We reported 5 markets because we do not have space in the article, but you should do it for all the countries.
Now it is time to analyze our data, but first we would like to remind you that:
These numbers do not indicate the whole size of one market. They indicate the value of the import.
What is the difference?
If a country produces internally all the chandelier and do not import any chandelier from outside, the import is 0 $, but the internal market of the chandelier is not zero.
However, these data are extremely precious (are free). They help us to understand better the international market of our products. We can start thinking about what are the most interesting international markets for our company.
In our example of chandeliers, where could be interesting to export? We can focus on the largest markets like the USA or Germany. On the other side, we can a smaller market like Poland could have better potential.
Argentina seems riskier because of the negative trend.
On the other side, we can discover small markets that maybe are not explored by our competitors.
In our example, we see that Uzbekistan is a very small market, that decreased in 2018 but jump in 2019. Why? It is impossible to answer with the data that we have: maybe there was a problem with a big local distributor, or maybe a new big producer of chandelier entered the market, or maybe there was a big public tender for supply of chandelier…
A big limit to these data is the HS Code. The HS Code identifies a category of products, but it doesn’t tell us what type of products have been sold.
In our example of chandeliers: we do not know if local customers buy expensive chandeliers or cheap ones; if they prefer floor lamps or wall lamps, etc
Again, it is the first macro analysis, which must be followed up by insights on specific countries that we believe may be interesting.
The good aspects of this market research are:
- It is free
- It can be done easily in a few hours
Are you planning to export abroad? Find international retailers and wholesalers on Globartis Business Platform