Week 5: Export Planning

Question 1

Common Mistakes Among New Exporters

Answer 1

1. Failure to develop strategic marketing plan before export commencement
2. Insufficient care in selecting overseas sales representatives / distributors
3. Failure to provide readily available servicing for the product
4. Neglect of export business when the domestic market booms
5. Reliance on orders globally rather than concentrating on one / two geographical areas
6. Unwillingness to modify products to meet regulations / cultural preferences of other countries

Question 2

Considerations in Export Planning

Answer 2

• Devise practical / applicable strategy
• Communicate internal commitment / co-op
• Unify efforts with shared reference point for related operations
• Define purposeful goals
• Analyse product / firm readiness
• Show clear evidence of market potential with positive findings through market research
• State clearly your strategy (direct / indirect)
• Solve logistical challenges
• Learn regulatory requirements
• Ensure payment terms and finance
• Measure success / use tangible project milestones

Question 3

Procedures in Export Planning

Answer 3

1. Business Profile – what’s the business / product / current strategy / domestic performance
2. Analyse strategic marketing fundamentals – why do customers by from the business rather than the competitors / what is the competitive advantage
3. Build a competitive SWOT – strengths, weaknesses, opportunities and threats assessment
4. Consider reasons for exporting – strategic / expansion / excess resources / first mover
5. Consider management commitment - senior management leadership and support

Question 4

Export Market Research / Selection

Answer 4

1. Market Research – sales potential / growth trends / demand forecast / easy of entry, competition, culture
2. Intelligence and Data Gathering – primary / secondary research
3. Visiting the Market – confirm suitability of market and distribution channels, review industry standards, meeting prospective distributors
4. Market Segmentation – target segments, demographics and other characteristics
5. Market Positioning – quality, image, appeal

Question 5

Internal Company Assessment

Answer 5

Company Description and Objectives:

• History and status
• Background and industry
• Company objectives and strategies (long/short term)

Products / Services:

• Description and comparison
• Innovative features
• Applications
• Technology
• Product development

Market Strength:

• Market Share
• Reputation

Management Team:

• Founders
• Ownership
• Key staff and staff attributes
• International orientation and experience

Question 6

Internal Assessment: Resources

Answer 6

Facilities

• Production capacity
• Storage ability

Human and financial requirements

• Funds for export
• Income / cash flow
• Sufficient finances for operations
• Sufficient labour to meet demand
• Experience / skills

Logistics
- Supporting operations

Question 7

External Assessment (Target Market)

Answer 7

Country:

• Economy
• Population
• Demand
• Infrastructure

Culture:

• Diversity
• Language
• Psychic Distance
• Religious Sensitivity

Government:
- Regulations / Tariffs

Competitors:

• Market Share
• Strength / Reputation

Risks:

• Political Instability
• Economic Problem
• Limited Legal Protection
• Currency Fluctuation