The Australian Trade Commission (Austrade) won the Award for the Best TPO from a Developed Country.
Austrade applied under the category of "Enhancement of the export capacity and/or performance of local industries". It sought recognition of its “New Exporter Development Program” (NEDP). NEDP was launched in 2002 with the objective of meeting the needs of potential exporters and helping them become successful new exporters.
In 2000, Austrade undertook detailed analysis of official statistics that showed only 4% of Australian businesses export; i.e. around half the level of most advanced economies. In addition, Austrade’s market research indicated that its product offering was not effectively meeting the needs of businesses getting into export and was better suited ro experienced exporters. Further research was carried out on the services offered by other TPOs in similar developed economies around the world. Some elements of these were adapted to suit Australian conditions.
In 2002 Austrade introduced NEPD to encourage new firms to export. Austrade challenged its assumption that general information and advice were all a potential or new exporter required to consider entering exporting, and developed a program specifically developed to meet the needs of new and irregular exporters.
In order to meet the needs of potential exporters the NEDP is built on five key elements:
There were four main stages under NEDP:
NEDP was designed around a network of individual Export Advisers throughout Australia, working during all four stages of the program to assess the export capability of Australian businesses and assisting them, through coaching and advising, to become export ready. The program provided these businesses with international exposure through free access to Austrade’s international network delivering services such as partner and buyer searches, market research and promotional activities.
Prospective companies were found through partner organisations, TradeStart offices, or applicants to Austrade’s Export Development Grants Scheme (EMDG). Approximately 2000 applications were made each year by Australian companies seeking a cash grant to assist them to enter an overseas market. A company must spend a minimum of AUD$15,000 on export promotion over a 2-year period to be able to be eligible to submit a claim under EMDG. Firms applying for a grant and envisaging this level of promotional expenditure were encouraged to apply to NEDP.
Initial services free of charge
Under NEDP, companies received initial information and advice on how to develop an export plan, identify export opportunities and make an initial assessment of which market or markets to tackle. In addition they could have up to 20 hours of services from Austrade's offices abroad, which would normally be charged at AUD$190 per hour: after that, further hours were charged at full rate. These otherwise chargeable services included a market entry strategy for the product or service which the business wished to export, identification of a potential partner in the market, representation to the local regulatory authorities if necessary, or making appointments during a visit by the business to the market. The company could tackle more than one market but they could not, under NEDP, receive assistance from more than two of Austrade’s offices abroad.
Aimed at non-exporting firms
Firms could qualify for NEDP if they had an Australian Business Number (ABN), Australia as their main place of business, not previously benefited from a similar service during the preceding three years, nor earned recurring export revenue during that same period in that same market. A firm was not disqualified if it had made individual one-off sales by responding to overseas enquiries or if they had sold through a third party. There was an obligation on the company, given in writing, that in return for Austrade’s assistance, the company would commit sufficient staff resources to carrying through the agreed activity, and also to formally advise Austrade when export sales were made. Inclusion of a company on NEDP lasted on average 18 months, after which the company was taken off the programme. Austrade believed this was long enough to make the first export sale, if the company was going to succeed in exports. Austrade recognised that, to ensure consistency across its total network of offices and those of its partner organisations within Australia, there needed to be consistent oversight of the programmes. This was the responsibility of its client services director.
Increased number of successful exporters
Firms using NEDP were obliged to notify Austrade of export sales over AUD$5,000 achieved in the first three years; they were then counted as a successful exporter. The objective of the Australian Government was to double the number of firms exporting, from 25,000 in 2000/2001 to 50,000 by 2006. Austrade was the principal body involved in delivering that objective and aimed to find 13,000 of the extra 25,000. By 2002/2003, it had helped to increase the number of exporters by 8,431 to 33,431, as measured by the Australian Bureau of Statistics. In 2003/2004, Austrade assisted around 1,193 exporters to make an initial export sale and helped hundreds more starters on their export journey.
Austrade’s client satisfaction rate in 2003/2004 under the annual export survey was 88%.
This approach could be adapted for most TPOs looking to contribute significantly to the internationalisation of small and medium-sized businesses. TPOs need to understand, however, the essence of supporting and coaching businesses from the moment they enrol in the program and of continuing to offer that support, even after the company had demonstrated export successes. Successful implementation required commitment by all parts of the organisation, especially the network abroad, to treat a firm in the same way. The TPO’s IT systems must, like that of Austrade, be capable of tracking support for a company if there was to be a time limit (e.g. 18 months) or resource limit (20 man days) on the support to be given.