Professional Documents
Culture Documents
Chapter
5
Export Marketing
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Aseem Kumar
Excel Books
Export Marketing
Export marketing can be defined as identifying willing foreign buyers whose needs could best be met using our products and delivering satisfaction through supply of goods in their countries complying with formalities of international transactions of both countries. The different stages of Export Marketing are: 1. Totally Uninterested firm
2.
3. 4. 5. 6. 7.
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Aseem Kumar
Excel Books
Export Marketing
Common Pitfalls
An exporter must safeguard himself against falling prey to any or many of these: Failure to realistically analyze the proposed export operations Inability to develop a suitable export-marketing plan Half-hearted commitment/lack of full sponsorship by the Top Management Careless/hasty decision-making Chasing orders all over the world
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Aseem Kumar
Excel Books
Export Marketing
Cont.
Copyright 2007, Aseem Kumar
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Aseem Kumar
Excel Books
Export Marketing
Political Environment i. ii. iii. iv. v. System of government Political stability and continuity Ideological orientation Government involvement in business Attitudes toward foreign business (trade restrictions, tariffs, non-tariff barriers, and bilateral trade agreements) vi. National economic and developmental priorities.
Cont.
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Aseem Kumar
Excel Books
Export Marketing
Economic Environment i. ii. iii. iv. v. vi. Overall level of development GNP, industrial sector Role of foreign trade in the economy Currency: Inflation rate, availability, controls, and stability of exchange rate Balance of payments Per capita income and distribution
vii. Disposable income and expenditure patterns. Social/Cultural Environment viii. Literacy rate, educational level
ix.
x. xi.
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Excel Books
Export Marketing
Market Access, Limitations on Trade i. ii. High tariff levels, quotas Documentation and import regulations
iii.
iv. v. vi. i.
Product Potential
ii. Local production, imports, consumption iii. Exposure to and acceptance of product
Excel Books
Export Marketing
Export Marketing
The buyer sourcing: Having completed the basic marketing research to establish particular potential pockets of customers, the next step is to look for
orders.
There are a number of sources available these days that provide useful buyer information in different product/country categories. These are: Government Agencies: A number of government agencies in India are engaged in export promotion activities in their respective fields. Exporters must seek their help in their export marketing pursuits.
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Aseem Kumar
Excel Books
Export Marketing
Buying Houses
Buyer is a proper designation in most foreign companies, who source products from other countries. The buyer does the job of buying products for his company from various sources including those located in other countries.
These buyers are specialists in their own fields and they travel around the
world to source suppliers. Multinational/global companies set up their own buying offices in different countries where they buy huge quantities and regularly. An exporter, thus, needs to find out such persons/companies who represent any foreign company as their buying agents in his line of work. The task to follow is to source orders from such set-ups.
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Aseem Kumar
Excel Books
Export Marketing
The process of initial dealings with a buying house is depicted in the flowchart below: Exporter submits profile with an introductory letter
The buying company reviews it and if satisfied calls the exporter for a meeting
The exporter if found satisfactory during the meeting, is asked to arrange for a factory visit
The buying house representatives inspect the exporters facilities
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Aseem Kumar
Excel Books
Export Marketing
The exporter creates and submits samples with his price quotation The samples are sent to buyers abroad The buyer asks for certain changes The exporter submits revised samples The foreign buyer approves the samples
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Aseem Kumar
Excel Books
Export Marketing
Foreign Visits
An expensive but fruitful way is to visit foreign countries to explore export business opportunities. Business travel abroad can locate and cultivate new customers and improve relationships and communication with current foreign buyers. Use all possible secondary data sources like buyer/importer directories published by various government/private institutions both in India and abroad, trade journals and other such publications that carry import enquiries, internet, etc. to collect potential buyer information in the area of your business. Establish contact with all leads possible to generate maximum response. Use e-mails as
far as possible as they are most cost-effective. Try to obtain the maximum
information about the prospects. Assess the inclination of the buyer. Do not insist on visiting him on your own initiative.
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Aseem Kumar
Excel Books
Export Marketing
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Never send a letter to a foreign buyer when you are angry or in a bad mood. Even when you are collecting from a foreign buyer unpaid accounts that are already due and demandable maintain your tact and diplomacy. If a foreign buyer tells an exporter that he is going to file a case against the latter for one reason or another, do not write back and say: Go to hell. Do not be irritated or offended by a day-to-day follow-up fax message sent to you by different persons working in the office of your foreign buyer. Make it a habit to reply to letter/fax messages of your foreign buyers.
Copyright 2007, Aseem Kumar
Aseem Kumar
Excel Books