My background is in digital marketing and communications. Creating content that inspires, informs or delivers on results is my passion. View all posts by Nicole Chevrier. Email address:. What information would you like to receive? Contact us at: www. Trending topics:. Entry into new markets may require two or three years of effort before showing a profit They are sensitive to and aware of the cultural differences of doing business in other countries If an organization does not have a solid domestic business plan , is struggling in its existing markets, is producing and selling an ordinary product that is readily available, and has limited financial, human and production resources, it is not in a good position to begin exporting.
Take advantage of support and resources If going global is in your plans, be sure to make full use of the considerable support, services and resources available. Is your business trade ready? Organizations can avoid this difficulty by: Ensuring suppliers can provide the raw materials and components needed to meet commitments Ensuring there is enough spare capacity, or that it can be created quickly, to meet unexpected large foreign demand Being prepared to modify and manufacture versions of products and services to meet the cultural, regulatory and certification standards of a foreign market Logistics Resources Being able to fulfill an order or a contract is only half the job—buyers still have to receive goods or services on time and in the expected condition.
Organizations should ensure: They have, or can acquire, an adequate knowledge of how products or services should be shipped or delivered abroad Their staff is, or can be, trained in export logistics Their staff is, or can be, trained to troubleshoot problems quickly and efficiently Holding quarterly or monthly meetings with foreign-trade experienced guest speakers can help organizations focus their efforts and generate excitement over new international initiatives.
Use Change Readiness Tools While many organizations choose to engage third-party experts to help them prepare for new international ventures, there are change readiness tools that are available. Ensure the success of new international ventures by knowing how to properly analyze your organizational readiness and correctly identifying promising opportunities. About the author. An Export Management Company functions as an "off-site" export sales department, representing company's product along with a variety of non-competitive manufacturers.
The Export Management Company searches for business for company and usually provides the array of services like it performs market research and develops a marketing strategy, locates new and utilizes existing foreign distributors or sales representatives, to put your product into the foreign market, functions as an overseas distribution channel or wholesaler, takes title to the goods and operates on a commission basis.
Another indirect exporting option is through Export Trading Company which is analogous to Export Management Companies. The ETC is more likely to take title to the product and pay directly, but like an EMC, they can also act as an export department.
Usually, there is less responsibility on the part of the ETC towards the supplier and they tend to be demand driven and transaction oriented. Licensing offers a small business the advantages of rapid entry into foreign markets as well as reducing the capital requirements to establish manufacturing facilities overseas.
Other option is Franchise agreements that tend to give the franchiser more control over marketing, since it is the company's reputation and existing market relationship that adds value to the product. Agreements with foreign manufacturers to produce company product, as opposed to exporting to the overseas region is known as contract manufacturing. It is an easy foreign market entry method when your manufacturer is already producing company product for the domestic market.
Main benefit of export is the possession which is specific to the firms' international experience, asset and capacity of the exporter to offer distinct product or low cost product with in the values chain. An assortment of investment risk and market potential is recognized as the site benefit of the particular market combination. Some companies have lower level of ownership advantage therefore they may not enter into the foreign markets.
In case a company's products and company's ownership equipped with the international advantage and ownership advantage, the entry can be made through low risk model. Another benefit is that low investment is needed in exporting of goods than the other modes of international trade and development.
In export of products, the managers perform the various operational control however it does not have the option over the control of marketing activities of the company. The consumer of exported goods is far away from the exporter though the different intermediaries can manage the risk.
Major barriers of export management include language, high risk, government control, difference in laws, difficulty in payment, custom duty, and lack of information. Other problems of export management are evil effects of foreign trade, economic dependence, disadvantage of agriculture country, international rivalry. Researchers said that there is high risk in foreign trade instead of internal business because goods are transported to other countries through sea, air in which there is environmental threat and products may be damaged from poor climate, rocks etc.
Usually international trade is under governmental control and licence is must for doing international trade. In export, management, there are differing law in each country therefore traders have to face many problems in conducting business. Export management become difficult when information flow is not smooth. It is very difficult to assess the financial position of businessman located in other country.
It is observed that developed nations get advantage through export business but developing countries may suffer loss as they cannot manufacture goods at rapid rate and managerial process is also not very smooth. Another problem is dependency on other country for raw material and if imports are stopped due to some reasons, country has to suffer a lot in terms of finance.
Export management is not smooth due to low labour productivity, less technological advancement and laziness. In order to reduce issues of export trade, it is suggested that traders must know various language for good conversation.
Export managers must have knowledge of exchange rates. They must modernize the process of foreign trade and standardize the products.
In addition to this there are some major disadvantages highlighted in the export of goods such as financial management, communication technology improvements, and customer demand and management mistakes. To reduce the risk of transaction process of exporting the goods and exchange rate fluctuation, it is necessary to have more capacity for managing the financials for coping up the efforts. We'll assume you're ok with this, but you can opt-out if you wish.
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