Because of your in-experience you might make some very expensive blunders. Make sure you DON’T do these things:
Your main concern is non-payment after you've shipped the goods. You
can largely avoid this by selling on a Letter of Credit (L/C) basis.
L/Cs assure payment because the buyer must deposit the money in advance
at his bank, and a correspondent bank in your country then takes on the
obligation to pay you.
However, many foreign buyers ask for delayed payments within 30-120
days after the goods arrive. You might have to offer this, if all your
competitors are offering these terms! Doing so increases your risk. You
can protect yourself with “export credit insurance”.
If buyers won't pay, it’s usually for one of two reasons:
You must complete the “terms of sale” as specified in
the L/C and the shipping documents. If you don't do this then it
becomes very hard to get paid.
Also, over time you will be able to recognize dishonest buyers. This is something that comes with experience.
Take effort to learn about your export business partners. Beware of
deals that are "too good to be true." Many of these will be scams.
You must understand that India is not the only corrupt country in
the world. In fact, many of the counties in the world are “much
more corrupt”. In many countries, corruption is common. The line
between what's customary and tolerable, and what's excessive or
illegal, is not always clear. Seek advice from a lawyer.
IMPORTANT: Watch out for firms out to copy your technology once they get a product sample or your first shipment.
Take special care to appoint good overseas agents and distributors.
Some may already represent your competitors, or be so busy they can't
do justice for your products. They may not have the qualifications or
capabilities they claimed, such as the ability to stock, install and
service your goods. In some countries, once you sign an
agent/distributor agreement, it's almost impossible to terminate the
agreement. Make sure you do not fall for this trap.
Every country has it's own business laws and regulations. Many may
be similar to our country’s laws or follow international
standards. Some vary widely by country. Failure to comply could trigger
fines or worse. Take the time to do market research and seek legal
advice as needed.
Political instability can cause dramatic changes, including major shifts in economic policy, nationalization, expropriations, loss of personal rights, and physical danger. It can prompt foreign reactions in the form of economic sanctions, boycotts, and embargoes. Be alert to what's happening in the world. Some shifts can favor exporters. For example, ongoing shifts toward privatization and trade liberalization in many previously controlled countries continue to offer opportunities for the world’s exporters.
All the information provided in till here, must have given you a good idea about what exporting is all about. You are now in the position to decide whether your firm has what it takes to export and whether, you want to go in for exports.
If you have decide to go in for exporting, the next step is to....
|Other articles YOU
How to start a company?
How to make money in the stock market?
How to manage your money?
How to manage time?
How to speak English fluently?