1) Why export ?

Exporting is an excellent way to expand and grow your business.

1) Small Companies Can Be Successful Exporters:

It's a popular misconception that only large companies can succeed overseas. Indeed, many small
companies have found that their competitive advantage lies in some form of technological or
creative advantage. Many have "unique" or "niche-type" products that are always in demand
overseas!

2) Export Assistance Is Available:

Many firms shy away from exporting because they don't know how or where to get started.
Fortunately, help is available! Food Export-Midwest, Food Export-Northeast, your local state
agricultural promotion agency and other export providers can provide your company with a wide
range of export assistance to help introduce you to the world of exporting.

3) Economic Growth:
Consumer preferences, shaped primarily by incomes, changing lifestyles, and evolving cultural
preferences, largely determine the items available in grocery stores in different markets. In
developing-country markets, higher incomes result in diet upgrades, with increased demand for
meats, dairy products, and other higher value food products.

4) Increase Sales and Profits:

If your firm is succeeding domestically, expanding overseas will likely improve overall
profitability as well. Average orders from international customers are often larger than they are
domestically, since importers overseas stock by the container rather than by the pallet. Furthermore,
increased sales tend to increase productivity by lowering per unit fixed costs.

5) Short-Term Security:
By expanding into international markets and spreading your risk over a wider customer base,
companies become less dependent upon the ups and downs of the domestic economy.

6) Economies of Scale:
Exporting is an excellent way to enjoy pure economies of scale with products that are more
"global" in scope and have a wider range of acceptance around the world. This is in contrast to
products that must be adapted for each market, which is expensive and time consuming and requires
more of an investment. The newer the product, the wider range of acceptance in the world,
especially to younger "customers," often referred to as the "global consumer".

2) Myths of exporting?

1: There is too much risk involved in exports

From start-ups to established companies, business presents challenges at all levels, and the fear of
additional international issues deters companies from expanding business on a global scale.
However, it’s been shown that developing into new, International markets can be beneficial to
organisations, increasing the customer base and subsequently, the bottom line.

2: There is too much to learn about expanding into new markets

There are different cultures, rules and procedures that need to be taken into account when looking to
develop business internationally. However, there is a lot of advice readily available in helping
companies to develop into new global markets.

3: Language will be a barrier to international business

In business, English is seen as a universal language. Most companies and representatives will either
have a working level of the language themselves or will have an interpreter on hand to enable
communication.

4: Smaller companies don’t have the resources to expand internationally

Through utilising the support and resources available, it can actually be easier for smaller companies
to develop their markets globally, than it is for the larger businesses. Operating with more flexibility
and, through a level of ingenuity or the recruitment of experts in the local market, smaller companies
can adapt products and services to meet the needs of the markets in which they are developing.
When looking to expand product reach to global markets, outsourcing to logistics professionals
enables businesses to utilise resources tailored to their specific requirements with little or no upfront
investment.

5: It is impossible to reach customers in foreign markets

Through advances in technology, the barriers to expanding internationally have been greatly reduced.
With the internet, e-mail and the capability of conducting meetings online, the need for global travel
has been greatly reduced.

3) The Motives for protective trade

• Protect sunrise industries

Barriers to trade can be used to protect sunrise industries, also known as infant industries, such as
those involving new technologies. This gives new firms the chance to develop, grow, and become
globally competitive.
• Protect sunset industries
At the other end of scale are sunset industries, also known as declining industries, which might need
some support to enable them to decline slowly, and avoid some of the negative effects of such decline.
• Protect strategic industries
Barriers may also be erected to protect strategic industries, such as energy, water, steel, armaments,
and food. The implicit aim of the EUs Common Agricultural Policy is to create food security for
Europe by protecting its agricultural sector.
• Protect non-renewable resources
Non-renewable resources, including oil, are regarded as a special case where the normal rules of free
trade are often abandoned. For countries aiming to rely on oil exports lasting into the long term, such
as the oil-rich Middle Eastern economies, limiting output in the short term through production quotas
is one method employed to conserve resources.
• Deter unfair competition
Barriers may be erected to deter unfair competition, such as dumping by foreign firms at prices below
cost.
• Save jobs
Protecting an industry may, in the short run, protective job, though in the long run it is unlikely that
jobs can be protected indefinitely.
• Help the environment
Some countries may protect themselves from trade to help limit damage to their environment, such
as that arising from CO2 emissions caused by increased production and transportation

4) Export risks
Doing business internationally brings new risks as well as new opportunities. It's important to be
aware of the additional risks involved with exporting, so you can identify, assess and manage them.

• property ownership rights, including intellectual property protection

• crime and fraud specifically targeting export companies
• financial risks, including non-payment or damage or loss of your goods in transit
• problems of success, shortages of capacity or money to meet international demand
• difficult relationships with contractors, distributors and agents.

5) trade barriers
 1. A barrier to trade is a government-imposed restraint on the flow of international goods or
services. Those restraints are sometimes obvious, but are most often subtle and non-
obvious.

2. embargo– a blockade or political agreement that limits a foreign country’s ability to

export or import. Embargoes still exist, but they are difficult to enforce and are not
common except in situations of war.

3. tariff–a tax on imports. Tariffs raise the price of imported goods relative to domestic goods
(good produced at home).

4. government subsidy to a particular domestic industry. Subsidies make those goods cheaper
to produce than in foreign markets. This results in a lower domestic price. Both tariffs and
subsidies raise the price of foreign goods relative to domestic goods, which reduces
imports.

5. import quota is a type of trade restriction that sets a physical limit on the quantity of a
good that can be imported into a country in a given period of time.Quotas, like other trade
restrictions, are typically used to benefit the producers of a good in that economy.

6) International events and trade agreaments influcing global state.

7) Trade documents.

8) Mode of payment

9) Modern of entry

10) inco terms terminologies

Incoterms - a.k.a. Trade Terms are key elements of international contracts of sale. They tell the parties
what to do with respect to carriage of the goods from buyer to seller, and export & import clearance.
They also explain the division of costs and risks between the parties.

1.CIF (Cost, Insurance and Freight)

CIF means that the seller delivers when the suitably packaged goods, cleared for export, are safely
stowed on board the ship at the selected port of shipment. The seller must prepay the freight contract
and insurance.Despite the seller paying for the freight contract to the selected destination port, once
the goods are safely stowed on board, responsibility for them transfers to the buyer.The seller is only
obliged to procure the minimum level of insurance coverage. This minimum level of coverage is not
usually adequate for manufactured goods. In this event, the buyer and seller are at liberty to negotiate
a higher level of coverage.

2.CIP (Carriage and Insurance Paid to)

CIP means that the seller delivers the goods to a carrier or another approved person (selected by the
seller) at an agreed location.The seller is responsible for paying the freight and insurance charges,
which are required to transport the goods to the selected destination. CIP states that, even though the
seller is responsible for freight and insurance, the risk of damage or loss of the transported goods
transfers from the seller to the buyer the moment the carrier receives the goods.The seller is only
obliged to procure the minimum level of insurance

3.. CFR (Cost and Freight)

CFR means that the seller delivers when the suitably packaged goods, cleared for export, are safely
loaded on the ship at the agreed upon shipping port.The seller is responsible for pre-paying the freight
contract. Once the goods are safely stowed on board, responsibility for them transfers to the buyer,
despite the seller paying for the freight contract to the selected destination port. The buyer must be
informed of the delivery arrangements with enough time to organise insurance.

4.CPT (Carriage paid to)drop down menu

CPT stands for when the seller delivers the goods to a carrier, or a person nominated by the seller, at
a destination jointly agreed upon by the seller and buyer. The seller is responsible for paying the freight
charges to transport the goods to the named location. Responsibility for the goods being transported
transfers from the seller to the buyer the moment the goods are delivered to the carrier.If multiple
carriers are used, risk passes as soon as the goods are delivered to the first carrier. The seller’s only
responsibility is to arrange freight to the destination. They are not responsible for insuring the goods
shipment as it is being transported.The seller should ensure that they make it clear on their quotation
that their responsibility for the goods ends at loading and, from this point forward, the buyer should
arrange appropriate insurance.

5.DAT (Delivered at Terminal)drop down menu

DAT is a term indicating that the seller delivers when the goods are unloaded at the destination
terminal.‘Terminal’ can refer to a container yard, quayside, warehouse or another part of the cargo
terminal. The terminal should be agreed upon accurately in advance to ensure no confusion over the
location.While there is no requirement for insurance, the delivery is not complete until the goods are
unloaded at the agreed destination. Therefore, the seller should be wary of the risks that not securing
insurance could pose.

6. DAP (Delivered at Place)drop down menu

DAP means that the seller delivers the goods when they arrive at the pre-agreed destination, ready for
unloading.It is the buyer’s responsibility to effect any customs clearance and pay any import duties or
taxes. Additionally, while there is no requirement for insurance, the delivery is not complete until the
goods are unloaded at the agreed destination. Therefore, the seller should be wary of the risks of not
securing insurance

7. DDP (Delivery Duty Paid)drop down menu

DDP means that the seller delivers the goods to the buyer, cleared for import and ready for unloading,
at the agreed location or destination. The seller maintains responsibility for all the costs and risks
involved in delivering the goods to the location. Where applicable, this includes pre-shipment
inspection costs and import ‘duty’ for the country of destination. Import duty may involve customs
formalities, the payment of these formalities, customs duties and taxes.DDP holds the maximum
obligation for the seller. While there is no requirement for insurance, the delivery is not complete until
the goods have been unloaded at the destination. Therefore, the seller should be wary of the risks that
not securing insurance could pose.

8. EXW (Ex Works)drop down menu

EXW means that the seller has delivered when they place or deliver suitably packaged goods at the
disposal of the buyer at an agreed-upon place (i.e. the works, factory, warehouse, etc.). The goods are
not cleared for export.The seller is not required to load the goods onto a collecting vehicle and, if they
do, it is at the buyer’s expense. EXW is the only Incoterm where the goods are not required to be
cleared for export, although the seller has the duty to assist the buyer (at the buyer’s expense) with any
needed documentation and export approvals.After collection, the buyer must provide the seller with
proof that they collected the goods. From collection, the buyer is responsible for all risks, costs and
clearances.

9. FAS (Free Alongside Ship)drop down menu

FAS stands for when the seller delivers the goods, packaged suitably and cleared for export, by placing
them beside the vessel at the agreed upon port of shipment. At this point, responsibility for the goods
passes from the seller to the buyer. The buyer maintains responsibility for loading the goods and any
further costs.The seller may procure a freight contract at the buyer’s request or, if the buyer fails to
procure one by the date of a scheduled delivery, the seller may procure one on their own initiative.
The buyer is responsible for the cost and risk associated with the freight contract.

10. FCA (Free Carrier)drop down menu

FCA means that the seller fulfils their obligation to deliver when the goods are handed, suitably
packaged and cleared for export, to the carrier, an approved person selected by the buyer, or the buyer
at a place named by the buyer. Responsibility for the goods passes from seller to buyer at this named
place.The named place may be the seller’s premises. While the seller is responsible for loading the
goods, they have no responsibility for unloading them if the goods are delivered to a named place that
is not the seller’s premises.The seller may procure a freight contract at the buyer’s request or, if the
buyer fails to procure one by the date of a scheduled delivery, the seller may procure one on their own
initiative. The costs and risks of this freight contract fall on the buyer. The buyer must be informed of
delivery arrangements by the seller in time for the buyer to arrange insurance.

11. FOB (Free on Board)drop down menu

FOB means that the seller delivers the goods, suitably packaged and cleared for export, once they are
safely loaded on the ship at the agreed upon shipping port. At this point, responsibility for the goods
transfers to the buyer. The seller may procure a freight contract at the buyer’s request or, if the buyer
has failed to procure one by the date of a scheduled delivery, the seller may procure one on their own
initiative. The buyer is responsible for the cost and risk of this freight contract.The seller must inform
the buyer of delivery arrangements in good time to sort out insurance for the shipment.FOB is a
frequently misused term. If a supplier insists FOB needs to be used for containerised goods, the buyer
should make certain that the selected insurance covers the goods ‘warehouse to warehouse’.