In Emerging Markets, Export Success Is About More Than Managing a Portfolio of Countries

Many companies approach emerging markets one country at a time. Those that endure think differently: they manage a portfolio and master a terrain of rare complexity. A look at a discipline that remains underdeveloped, even, paradoxically, among local champions in these markets.

International failure is often blamed on the wrong product or the wrong market. Field observation suggests a more structural cause: the difficulty of managing not one market, but a set of markets. “In a basket of emerging countries, every year a handful outperform, another handful suddenly turn around under the effect of exchange rates, politics, the economic cycle or a change in standards, while the majority remain stable without ever really taking off,” observes Ferreol Tournebize, who has spent nearly twenty years in these markets, from Africa to the Middle East. Growth does not come from one star market: it comes from the discipline with which this dispersion is managed. But managing dispersion is not enough. One must also survive a terrain that discourages most large groups.

A maturity curve

This discipline follows a progression that can be seen everywhere. Small companies approach export opportunistically: a request comes in, a distributor appears, a first foreign customer is won, but without a clear direction or a reading of risk. Mid-sized companies professionalize: an export manager, an international department, then a portfolio of markets built country by country. Large groups, meanwhile, already think in regional hubs and constantly arbitrate between stability, potential and level of investment. The higher one moves along this curve, the less markets are simply endured, and the more they are weighted.

The portfolio rule

The core reasoning lies in a number effect. Across a sufficiently broad basket, the winning countries, which mechanically capture more sales, pull the whole upwards, even when several markets decline. With twenty-five countries, the aggregated result can remain clearly positive even if one fifth of the portfolio falls. With only five or six markets, everything depends on the draw: two bad countries can be enough to sink the year. “Diversification does not remove risk; it makes it manageable.” Each market still has to be weighted by its macroeconomic stability, FX exposure, political risk and real potential.

A portfolio of 25 markets: 5 countries above +10%, 5 down below -10%, 15 stable. Sales-weighted total: +5%.

With 6 countries, the result is highly volatile; with 25, it converges towards the +5% target.

A terrain that large groups fear

If dispersion is so strong, it is because the terrain itself is exceptionally unstable. Over a few years, a portfolio of emerging markets goes through almost everything: currency crises, changes in standards and customs regimes, import duties revised overnight, armed conflicts, logistical crises and corridor closures, storms and climate shocks, social unrest and riots. None of these shocks is exceptional. What would be exceptional is to believe one will escape them.

This instability is compounded by structural fragmentation. The Middle East and Africa alone represent nearly sixty addressable countries, and therefore almost as many bodies of standards, customs regimes and ports, each with its own constraints. In each market, local supply coexists with flows from Europe, Asia and the United States, often for modest unit volumes. Managing such complexity for low volumes is enough to discourage many players.

This is precisely what deterred many large groups from truly investing in these markets, and they were not wrong: risk and complexity form a very real barrier to entry. But this barrier has another face. It leaves the field to those who know how to cross it: local champions and disciplined players, capable of managing both a portfolio of countries and the operational complexity that comes with it. Difficulty is not only a risk; it is also protection.

And the recent context strengthens this advantage. Between climate crises in Europe, US tariff policy, tensions in the Strait of Hormuz and supply disruptions from China, as soon as one crisis closes another opens. Those who know how to work emerging markets are accustomed to rough waters: what is now destabilizing supposedly safe economies has long been familiar to them.

Complexity intimidates some groups and leaves the field to actors capable of managing both portfolio and complexity.

Three entry doors

This portfolio logic is matched by a gradual market-entry strategy. In small markets, the distributor is the natural route; in intermediate markets comes the joint venture; in the largest markets, the company establishes its own structure, a hub able to serve both the domestic market and neighbouring countries. Each model is an arbitration between value captured, control, risk exposure and capital commitment.

The paradox of local champions

Curiously, this discipline is often missing where one would expect it most: among the local champions of emerging markets themselves. Strong, and sometimes dominant in their domestic markets, many struggle as soon as they cross their borders. Three pitfalls recur. The first is an overly heavy implementation model, poorly adapted to the target market, which turns a promising expansion into a cost centre and weighs on foreign profitability. The second is a “cost-plus” export logic that destroys value instead of creating it: selling for the sake of selling, without truly capturing margin. The third is pure opportunism, without direction or allocation, which makes growth unreadable and impossible to replicate. “Being successful at home does not prepare a company to manage a portfolio of countries. It is another business.”

Support that is rarely accessible

The issue is not so much access to capital as access to method. Large groups can afford high-level strategic, financial and transactional advisory. SMEs and mid-sized companies in emerging markets rarely have access to it, because such advisory remains calibrated and priced for large organizations. Yet these are precisely the companies that, when raising funds, selling an equity stake, partnering with a strategic player or accelerating internationally, have the most to gain from rigorous support , while too often entering these discussions late and poorly prepared.

Filling the gap

This observation led Ferreol Tournebize to found IMERGEA, a French M&A advisory firm born in Africa and designed for emerging markets. Its purpose is to make strategic and financial intelligence, long reserved for large groups, accessible to ambitious SMEs and mid-sized companies. The firm provides free tools: an export performance diagnostic, which compares country-by-country sales against economic indices while taking market frictions into account; a sector benchmark, which positions the company within its sector to measure what truly matters, in the spirit of the OKR logic popularized by John Doerr; and a targeting module, Find My Buyer, which identifies investors and acquirers by sector and geography. These tools are complemented by support on valuation, capital raising, equity sale and strategic combinations.

One conviction remains at the heart of the project for Ferreol Tournebize: the still underexploited potential of South-North combinations. Companies in emerging markets need capital, structure and international access; European investors and industrial groups are looking for growth relays and solid local partners. “Between these two worlds, a bridge is almost always missing.” That is the bridge IMERGEA intends to build, where growth is still built on the ground.

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