PRELIMINARIES FOR EXPORTS

1. Meanings of Exports. 2. Classification of Goods for Exports. 3. Strategy and Preparation for

Exports.

Meaning of Exports
According to Sec2(e) of Foreign Trade(Development & Regulation) Act, 1992 the term Export is defined as: Taking out of India any goods by land sea or air The goods must leave India, or cross the customs frontiers of India to a foreign destination.

Deemed Exports Certain transactions in which the goods supplied do not leave the country and the payment for such supplies is received either in INR or in free foreign exchange are reckoned at par with exports.

Classification of Goods for Exports

Permissibility of import & export of goods is

governed by the nomenclature{goods are arranged as they are in the Harmonised System (HS) but are codified with 10 digit numerical code to identify goods} ITC (HS) classification of import & export goods, published by the Directorate General of Foreign Trade(DGFT).

Classification of goods for exports:

Prohibited Goods Prohibited items are not permitted to be exported. For Example:- wild animals, exotic birds, beef, sea shells, human skeleton, peacock feathers etc. Restricted Goods These type of items can be permitted for export under license.

 The condition wherever specified against the

restricted items may be required to complied with. State Trading Enterprises Export through State Trading Enterprises STE(s) is permitted without an Export License through designated STEs only as mentioned against an item. Restrictions on Countries of Export Export to Iraq is subject to conditions as specified in Para 2.2 of the handbook of procedures 2002-2007.

STRATEGY & PREPARATION FOR EXPORTS

Strategy lays down the clear objectives & means of achieving those objectives. Export marketing strategy defines the selection of a target market & determination of an ideal blend of product, price, promotion & distribution mix. An export marketing strategy of a firm may include the following aspects:

Ps of Exporting Marketing The 4 ps of marketing are commonly known as: Product Price Place Promotion International trade being more complicated, there are additional 9 ps resulting into 13 ps of international marketing. They are:

 Payment Personnel Planning

Paperwork
Practices Partnerships

Policies
Positioning Protection

Export Marketing Plan An export marketing plan is a step-by-step guide for strategy implementation. A typical export marketing plan focuses on:Marketing objectives Market Segmentation Market Research Characteristics of Product Export Pricing Distribution Channels Promotional Strategies

Assessing a Products Export Potential

It means to assess the products success in

domestic markets. It means if a company succeeds at selling in a domestic market, there is a good chance that it will also be successful in markets abroad. If a product is unique which is hard to duplicate abroad, chances are good for finding an export market.

Making Exports Decisions

What does the company want to gain from

exporting? Is exporting consistent with the other goals of the company? Does the company possess adequate key resources, like management, personnel & finance? Are the expected benefits are worth the costs?

Approaches to Exporting
There must be 4 approaches, which may be used alone or in combination: Passively supplying to domestic buyers who then export Seeking out domestic buyers who represent foreign end users or customers Exporting indirectly through intermediaries Exporting directly

Export Pricing
Following factors need to be considered while setting export price:Currency exchange rates Market research & credit checks Receivables/risk insurance Business travel International postage, cable & telephone rates Commissions, training charges & other expenses on foreign staff Consultants and freight forwarders; & Product or services modification & special packaging.

There are several pricing strategies available to an exporter depending upon the nature of the economy. Static Pricing Flexible Pricing Full Cost Pricing Marginal Cost Penetration Pricing Market Skimming

Export Promotion
Advertising Promotional materials Direct mail Media Personal visits Trade shows Internet