Selection of Products for Exports for easy marketing
Selectivity is the key to success in all spheres of life including export market. An exporter may wish to deal in all kind of products and to sell them everywhere in the world. However, it is not possible for him to do so due to the wide expanse and demand variations in different markets of the world. Therefore, an exporter has to select proper product(s) and proper market (s) in order to operate at the international level.
3.2 Selection of Export Products:
An exporter has to consider the following factors while selecting product(s) for the export market: (a) Export Trends:
(a) Export Trends: An exporter should analyse trends in export of different items to the overseas market(s) for proper selection of the product. Such information can be gathered from the following sources:
Monthly statistics of foreign trade of India.
Export Promotion Council (EPC) Bulletins.
Export Import Times.
The final selection of the product, however, depends upon one's own ability and experience relating to the product.
(b) Supply Base: Along with demand of product in the international market, it is also necessary to analyse its supply base in the domestic market. Most of the agricultural products defy this criterion as their supply depends upon a number of factors, which are based on nature. Seasonal commodities like onions, fruits or even sugar, wheat or rice have not proved to be good items for sustained export business. Even manufactured products may not have a good supply base due to factors like strike, power shortage, lockouts, transport problems, etc.
(c) Production Capacity and Product Availability: Sky is the limit for selling a product in international markets. Hence, a manufacturer exporter must consider his production capacity and a merchant exporter must take into consideration the availability of the product selected for export before entering into an export contract. If the production capacity or availability is limited, then the exporter should focus on smaller markets. However, if the product can be made available easily, a sustained export drive is worthwhile.
(d) Product Adaptability: Associated with the production capacity and availability is the possibility of adapting the product as per the requirements of the foreign markets. The needs and requirements of buyers differ from market to market and country to country. What sells well in one market may not sell at all in other markets. This calls for product adaptability. Product adaptability is not an easy task, as it requires large amount of investment in adjusting production process as per the needs of the different markets.
(e) Servicing Facilities: If the product selected for export is such that it requires servicing after sales, then the exporter should see to it that he can avail such T facilities to the overseas buyers. It is not always easy and within one's means s to open servicing centres abroad. At the same time, it is difficult to find a h distributor or agent having servicing facilities. If it is not possible for the exporters to provide such servicing facilities then the exporter should not venture to export such products.
(f) Target Markets: Selection of a product also depends upon the markets E which have been identified for sales abroad. All products may not have equally good markets everywhere. Therefore, selection of the product e. depends upon the market requirements. It is always better to concentrate on one or two markets at least to start with. One should study the target markets (E closely, with regard to market requirements in terms of product specification, (t continuity of demand, change in fashion, credit requirement, if any, etc.
(g) Demand Stability: Product(s) selected for selling whether overseas or in the (c domestic market should not only have stable but a rising demand. Seasonal (E products should be avoided unless the exporter has necessary infrastructure (f' for selling them. Products depending upon fashion trends, though comparatively H more profitable, may not always prove to be good for those exporters who T. cannot cope with such trends. Therefore, the exporter should select such products, which provide a large and stable market
(h) Trade Restrictions: While selecting product(s) for exports, it must be ensured that such product(s) should not be subject to the country's export (t Control regulations or import Control regulations of the concerned target (c markets. Although, export restrictions in all the Countries are minimum as (c there is a tendency to promote exports of all products, still there are a iv number of items where Controls do exist. Therefore, the exporter should try to avoid export of such product(s).
(i) Profitability: Last but not the least; Profitability is the prime objective of all marketing activities. The product selected for exports must fetch a fair profit (F to the exporter. Moreover, profitability should as far as Possible be direct, Le" arising from the sale price itself. Though export benefits like duty drawback, excise refund, etc., are necessarily to be taken into consideration while calculating the export price, it is always better if the product sells in the overseas markets even if such assistance is not available.
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