Short Title:
How to do business?
Sector:
Honey and Sweeteners
Reading time:
9
Updated at:
Wednesday, October 28, 2015 - 00:00
Document name:
ten tips for doing business with European Buyers (2015)
Intro:
The European honey market increasingly depends on imports from other regions to meet the local market demand. Buyers therefore need to increase their network of suppliers. This offers good opportunities for honey exporters looking for new customers, especially for those companies which understand the needs of the European buyers and are able to meet their requirements.
Content study:
Title:
Make sure you meet the legal and buyer specific quality requirements
Body:
The biggest difficulty European buyers encounter when sourcing honey from other regions is to identify honey exporters who meet the quality requirements of the European market. Often, the honey does not meet the quality standards buyers are used to. Explanations for that can be technical, such as the climatological circumstances in tropical regions with high humidity levels and temperatures. But often lack of competence is the main reason: a lack of know-how of the honey processor/exporter on adequate harvesting and processing standards, lacking quality and food safety procedures or inadequate product export documentation.
To sell your honey to European buyers means that your honey needs to comply with the specific EU honey legislation Directive (EC) 110/2001 and that it complies with the Maximum Residue Levels (MRL) for residues. In addition, it means that you need to comply with general EU food legislation with respect to food safety and traceability.
Tips:
Tip:
Study the CBI Buyer Requirements for Honey. Invest in internal quality and food safety processes and certifications. Understand the specific quality requirements of your customer. Refer to the website of CBI for more information.
Title:
The quality of your communication is as important as the quality of your honey
Body:
The second biggest complaint of European importers is the quality of communication with some of their honey suppliers. Issues they experience most include lack of communication, late communication, lack of the right type of information and documentation and sometimes a complete lack of understanding the needs of the buyer.
Honey importers depend very much on close cooperation with their suppliers. They often work with a large number of suppliers from different countries and continents. The importers have obligations to their main customers in the food retail and the food processing industry. All this requires excellent planning and communication to make sure that all products come in on time, with the right quality, the right documentation and according to all other conditions negotiated.
Tips:
Tip:
Have a protocol in place for customer communication which defines response time. Other responsibilities will include the customer contacts and specific information that needs to be communicated to the customer, related to things such as harvest forecasts, sample process, product documentation, quality issues and incidents, etc.
Title:
Have a clear pricing and payment policy
Body:
European honey buyers operate in a market where it is not easy to increase their prices or their end customers. Their retail customers as well as their customers in the food and beverage industry operate in a very competitive environment where cost reduction and optimisation is essential. Working with suppliers who provide stable prices and can offer flexible payment conditions is also important.
In order to be well prepared for export you need to have a good internal pricing model which gives you a clear idea on how changes in any of your cost factors in your process affect your final export price. Your customers want predictability in prices and often cannot absorb abrupt changes. Also think about the payment terms you can offer to your customer. Working with buyer credit is attractive for your customer but also has an impact on your financial exposure and cash flow position.
Tips:
Tip:
Try to maintain stable price levels for your customer. Have some margin in your prices to absorb local changes that can affect your cost level. Inform your customer as soon as possible on possible price changes or factors that could cause price changes.
Title:
Understand your customer and his market
Body:
For buyers it is a good sign when potential suppliers they talk to are well informed. Buyers prefer to work with exporters who more or less understand the European market situation and needs in terms of supply. Demonstrating an understanding of your customer’s strategic needs and your role in satisfying these needs is a clear competitive strength.
As a supplier, you need to have an idea of the type of honeys your buyers work with, the companies they supply to and the types of food safety and quality certificates they have or may ask for. It is important to stay informed on which market segments your customer sells to.
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Tips:
Tip:
Do some basic background research on your customers. Visit their website and try to find information about them on the internet. Also understand the market they operate in. You can refer to the website of CBI for market information.
Title:
Create a story behind your product and brand
Body:
Buyers want more than just a good product; they want to have a connection with the company they work with. For your company it is important to sell not only your product but also the story behind your business: the natural environment, the sources where your bees forage their nectar and pollen, the history of your company, your relationship with the local community, and the impact you have on social and environmental conditions.
Honey is a premium natural product, with specific sensorial, nutritional and biochemical characteristics. Understanding the world behind your honey, emphasizing elements like colour, taste, richness in soil and vegetation of your region and the social and environmental aspects of your business, helps your buyers connect to your business and differentiates you from the competition.
Tips:
Tip:
Often, the difference is not in your honey or in the commercial conditions your company offers, but in the story your company sells. The story helps buyers connect to your company and feel good about doing business with you.
Title:
Be professional in your sample shipment process
Body:
Sample shipment is a crucial process in the buying process. Samples allow the buyer to see if your honey meets legal and international technical requirements. It also provides valuable sensorial information which allows the importer to decide on the right application for your honey. Unfortunately, many things can and do go wrong during the sample shipment process.
Of crucial importance is that the pre-shipment samples you send to your customer correspond with the shipped honey. The honey should be accompanied by a laboratory analysis provided by a laboratory specialised in honey and accepted by your customer. Also, make sure that the samples are sent with full test results and documentation and that the courier you use understands the shipping procedure; otherwise your product may not arrive.
Tips:
Tip:
Work with a laboratory specialised in honey such as Intertek Food Services GmbH or Quality Services International GmbH or Minerva Scientific.
Title:
Invest in quality and food safety certification
Body:
Although border control checks and product legislation are much more rigid for honey than for many other products, there is still added value in investing in food safety and quality certification. Investing in these systems and certifications shows you are committed both to an excellent product and to excellent processes in terms of food safety and quality control. This will be often considered as a plus by your buyer.
An important certification in terms of food safety is HACCP, which is a systematic preventive approach to food safety from biological, chemical, and physical hazards in production processes. An import certification in terms of quality management is ISO 9001, which is a standard based on a number of quality management principles including a strong customer focus, the motivation and implication of top management, the process approach and continual improvement. Other relevant certificates are ISO 22001, BRC and IFS, which are more demanding food safety management systems than HACCP.
Tips:
Tip:
Develop an internal plan with respect to food safety and quality management. Discuss with your customers to identify which certificates could be of relevance to him. For more information on certification schemes please refer to CBI Buyer Requirements for honey and for detailed information on specific schemes to ITC Standards Map.
Title:
Create Added Value for your customer
Body:
The value of the commercial proposition you offer to your customer is determined by the value your buyer can generate from buying your product. Your customer, like you, is looking for ways to generate more money from his business. Working closely together can create a win-win relationship.
There are a number of ways you can add value to your business. First of all via your product offering. You can offer different types of honey, based on sensorial characteristics, based on nutritional values or based on floral sources (both polyfloral and monofloral honeys). Another area where you can add value is in certification: offering product with certificates such as organic, fair trade, Kosher/Halal, GMO free, etc. can offer benefits for your business. Another way to add value is by offering excellent service: offering your customers full support and different solutions facilitates their work.
Tips:
Tip:
Regularly check the updates on the CBI website to stay informed on what other honey exporters from your country or other countries offer in terms of added value products, certifications and services. Also see what your buyer is offering to his customers. Refer to CBI Buyer Requirements for honey for general information on organic, Fairtrade and other certification schemes or to ITC Standards Map for specific information on certification schemes which can help you add value to your product.
Title:
Invest in the relationship with your customer
Body:
Buyers increasingly look for long-term sustainable trade relationships. Instead of sourcing from different suppliers every year, they prefer to work with a fixed number of suppliers in order to meet most of the demand. Working with fixed suppliers facilitates the buyer in many ways, it creates stability, reduces test costs, mitigates potential risk and optimises communication in the process.
In order to create lasting supply relationships with your customers, it is important to invest in the personal relationship with them. Make sure that you have yearly opportunities to meet face to face, use this time not only to gain a better understanding of each others’ interests but also invest in the personal relationship. Invite your buyer for drinks or dinner during a trade fair, set up a social programme if your client visits you or visit your buyer at his company.
Tips:
Tip:
Customers are looking for trust, reliability and convenience. The longer and the better your relationship with your customer, the more it will feel like a true partnership.
Title:
Be involved in national and international industry platforms
Body:
Visibility in the sector is extremely important for companies wanting to export their products to the European market. For a buyer, seeing that a (potential) supplier contributes to the development of the sector on a regional and international level is a good sign. It demonstrates that a company is truly committed to taking responsibility and creating a sustainable business environment.
For buyers it is not always easy to see who the best and most professional honey suppliers in a country are. A honey exporter who actively takes part in national and international discussions regarding honey quality and the sustainable development of the sector is usually considered a more attractive supply partner. The honey sector is a dynamic sector where it is important to stay up to date with the latest developments.
Tips:
Tip:
Join the national or regional honey exporters or beekeepers association of your country. Participate in international platforms such as Apimondia.
Last updated:
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Tags Sector:
honey and sweeteners
Tags Type_of_study:
tips for doing business
Tags Country:
europe
Chart:
Chart type:
Line chart