Advance conditions terms with export middlemen are

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Unformatted text preview: rter to one or more markets. 6. After this success, the firm pursues country- or region- focused export marketing based on certain criteria. 7. The firm screens global market potential before selecting the “best” target markets to include in its exporting marketing strategy and plan. Organizing for Exporting • Companies have the choice of handling exporting in- house or through external organizations • In- house exporting can be handled o As a part- time activity performed by domestic employees o Through an export department or international division o For multi- divisional companies; each possibility exists for each division • Or with the support of external export partners Organizing for Exporting in the Target Market Country • Direct market representation o Advantages: control and communications o Company learn about the customers and the market o Can control prices, promotion, distribution etc • Representation by independent intermediaries o Advantages: best for situations with small sales volume o Disadvantage: poor control 8- 3 The export order « contract » • The export « contract » is actually a bundle of agreements and documents dealing with all the aspects of the export order • The basic contract is between an exporter and an importer: who they are must be clearly specified • When exporting is arranged directly, the producer of the goods is the exporter and the final customer is the importer • All terms and conditions for the execution of an export order should best be established in advance • Conditions & terms with export middlemen are handled in separate agreements Establishing the export contact • Initial inquiry and collection of background information • Preparation and sending of formal offer • Negotiations between the parties as to price, terms & conditions agreement • Receipt of purchase order • Confirmation of order & Preparation of pro- forma invoice • These documents (plus all handling, shipping, insurance documents) serve as the contract for the export sale • Execution of the contract Execution of the exporting contract • Exporter must confirm whether the product may be legally exported • Importer must confirm that the product may be legally imported • Disputes—which often arise in export orders—are difficult...
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