How to Expand Your Market By Exporting
If you operate in a domestic market that’s already saturated, there is no other option but to grow your sales rapidly through tapping the vast opportunities in the export market. Too few entrepreneurs in the Philippines attempt to bring their products abroad. There are far more importers here than there are exporters.
Knowing the importance of exports to our economy, the rules and procedures in exporting are much easier than importing. Nevertheless, there is much to learn to avoid problems in the process. To introduce you to exporting here are just a few of the important things you must know:
Financing programs and other incentives for exporters. It is important that you tap all the available incentives that could be obtained for operation. Exporters get special privileges like exemptions from certain taxes and special financing assistance.
Products that need permission or illegal to export. Not everything may be exported. There are many items that you must get permission from the appropriate government agency. Examples of items that need permits to export are certain types of seeds. There also items that cannot be exported. An example of this are endangered species.
Incoterms. Knowing about incoterms (International Commercial Terms) is necessary to engage in international trade. These are pre-defined commercial terms published by the International Chamber of Commerce (ICC) that are used worldwide to define the tasks, costs and risks that are in the international transportation of goods.
Costing of exported products. Besides the usual cost of producing the goods, you must also learn how to factor in the foreign exchange rate, tariffs, transportation, insurance and other costs that are significant expenses in foreign trade.
Letter of credit. Although the word “credit” implies that it is some kind of a loan, its primary purpose is to guarantee payment upon fulfilment of agreed-upon conditions. It is a document issued by a bank or financial institution assuring payment to a seller upon satisfactory completion of the requirements as shown in the documents indicated in the letter of credit. Without the use of letters of credit, the risk of non-payment may be too great as both parties are very far away.
How to prepare a commercial invoice. This is the document used in foreign trade that is used as a customs declaration by the person or company who is exporting. Although there is no standard format, there is much information that must be indicated in the invoice for it to be valid. Among the data needed are the parties involved in the transaction, the country of origin, the item being exported, and many other necessary information.
Exporting can be the key to expanding your sales. You will also learn many things to improve your operations by competing in the world market. Now may be the right time to take the plunge and venture into exporting.
To know more about exporting, BusinessCoach, Inc., a leading business seminar provider, conducts a seminar entitled, “How to Export Products.” Contact (02) 727-5628, (02) 727-8860, (0915) 205-0133 or visit www.businesscoachphil.com for details.
Click here to view details of the seminar: How to Export Products »
*Originally published by the Manila Bulletin. C-6, Sunday, September 15, 2013. Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved. May not be reproduced or copied without express written permission of the copyright holders.