SEMA-Member Manufacturer Survey Provides Insights Into Export Activity
California-based Baja Designs was one of 40 exhibitors at the Custom Show Emirates as part of the 2017 SEMA Middle East program. The program includes exhibiting at the largest show in the Middle East, visiting shops in the United Arab Emirates, selling styling and performance products, and meeting throughout the week with pre-vetted buyers.
SEMA recently conducted a survey regarding the exporting activities of its U.S.-based member manufacturers. The 243 SEMA members that completed the survey represent nearly 11% of SEMA-member manufacturers located throughout the United States.
Companies were asked how actively they are engaged in exporting. Among other information, the members provided insights into how much of their total revenue is derived from their overseas business, their top global markets in terms of revenue, and their short-term business outlook regarding international sales.
A full 84% of SEMA-member manufacturers reported that overseas sales contribute to their bottom lines, and 51% take a hands-on approach, with 124 respondents noting that they actively seek overseas business. Another 33% reported that they know that their products are reaching overseas enthusiasts, though that is largely through their U.S.-based distribution (i.e., warehouse distributors). The remaining 16% reported that they don’t export abroad and/or aren’t aware if their products are being sold overseas.
Of the SEMA members reporting a strategic and hands-on export plan, an average of 20% of their total sales comes from their overseas customers. For those selling products indirectly through a U.S.-based warehouse distributor or other U.S.-based entity, an average of 10% of their sales are generated by overseas purchasers.
In addition to meeting with potential customers, participants in the overseas business-development programs can gain insights into what local enthusiasts are looking for, including the vehicles they drive, the terrain (sand versus dirt), and local regulations affecting allowed products.
Of those members that aren’t currently exporting (16%) and those that aren’t selling directly but rather rely primarily on their U.S. distribution (33%) to get their products to destinations outside the United States, a little more than a third are planning to begin exporting or to do so more strategically and directly.
The vast majority of those actively exporting are optimistic about their global sales opportunities in the short-term, with 83% expecting increased overseas sales over the next three years.
Not surprising, the number-one country SEMA members looked to for foreign sales was our Northern neighbor, Canada. The second most important destination, in terms of sales, for SEMA-member exports among respondents was Australia, followed by Europe. Mexico/Central America and the Middle East tied for fourth place.
Top Markets Expected in the Next Three Years
- Australia/New Zealand (tied for first)
- Canada (tied for first)
- Middle East
- Asia (other than China)
- South America
- Mexico and Central America
Of the SEMA-member manufacturers who are engaged in exporting, 36% said that stepping up their marketing abroad to build brand awareness in key markets was the one thing that would help their companies most. Another top factor identified was the
need to build out their overseas distribution channels beyond their current customer base.
SEMA’s overseas business development trips provide member companies with a low-cost, efficient way to explore three markets that SEMA has identified as promising: the Middle East, Australia and China.
As part of SEMA’s overseas business-development conferences, exhibitors meet with pre-vetted buyers in turnkey booths at top regional customizing shows in the United Arab Emirates, Australia and China.
SEMA Middle East, Abu Dhabi, United Arab Emirates, April 3–8
Participants can learn the potential for their products in the customizing-crazy United Arab Emirates and the surrounding region. Buyers from 11 countries attended the 2017 event, and consumers are eager to get the latest U.S. products for classic-car restoration, off-roading, racing, street performance and aesthetics. A high disposable income coupled with a passion for personalization makes this a very attractive region.
The 2018 program includes hotel, meals, networking events, briefings, tours of specialty-equipment shops, and exhibiting at the Custom Show Emirates in a turnkey booth.
SEMA Australia, Melbourne, Australia, May 24–28
Participants can explore this market of true gearheads and the opportunities for manufacturers of sought-after products for SUVs, pickup trucks, street performance, and racing. Sales of the new Ford Mustang are red hot, and rumor has it that Australia has more hot rodders per capita than anywhere else in the world.
The 2018 program fees include hotel, meals, networking events, briefings, tours of specialty-equipment shops, and exhibiting at the MotorEx show in a turnkey booth.