Export Transactions and the Role of Export Office

Export Transactions and the Role of Export Office

Introduction

  • Title: Export Practice and Management, Fifth Edition

  • Author: Alan Branch

  • Unit: 3 - Export Transaction and the Role of Export Office

  • Course Code: International Trade Policy & Practice (CRN16910)

  • Instructor: Emily Tebbs-Ogutu

Lecture Outline

  • Modifying Your Product for Export

  • Elements of Product Preparation for Export

  • Export Office Organization and Structure

  • Export Benefits and Risks

  • Role of the Export Office

  • Export Policy and Records

Preparing Your Product for Export

Considerations for Product Modification

  • Companies may need to modify products to meet various requirements including:

    • Government regulations

    • Geographic and climatic conditions

    • Buyer preferences

    • Standards of living

    • Distinct engineering and design standards

Elements of Product Preparation for Export

  • Essential elements for preparing products for export include:

    1. Packaging

    2. Labelling

    3. Installation

    4. Warranty

    5. Service

    6. Shipping

    7. Pricing

Export Benefits and Risks

Developing an Export-Led Company Strategy

  • Discussion of key points regarding benefits and risks of developing an export-led strategy:

    • Benefits: Access to new markets, increased sales, scaling the business.

    • Risks: Market uncertainties, regulatory challenges, currency fluctuations.

  • Solutions to mitigate risks should also be explored.

The Role of the Export Office

Importance of the Export Office

  • An in-depth analysis of the changing functions of the export office, specifically focusing on:

    • Outsourcing of component parts

    • Assembly plants established overseas

    • Development of logistics

    • Globalization aspects

  • Noteworthy examples include:

    • Nike Case Study: Analyzing Nike's export operations and logistics.

Differences Between B2B and B2C Marketing

Relationship Development

  • B2B (Business-to-Business): Focus on building long-term personal relationships.

  • B2C (Business-to-Consumer): Concentration on driving short-term value efficiently.

Branding

  • B2B: Lead generation is prioritized over solid brand formation.

  • B2C: Emphasis on increasing brand recognition for product sales.

Decision-Making Process

  • B2B: Buyers engage in planned and logical processes involving committees for purchasing decisions.

  • B2C: Buyers exhibit emotional responses, making decisions based on desires.

Audience Targeting

  • B2B: Marketing targets groups with multiple decision-makers and managers.

  • B2C: Marketing is directed towards individual end users.

Terminology

  • B2B: Utilizes industry-specific terminology to engage potential business partners.

  • B2C: Employs simpler language connecting with potential customers.

Export Office Organization and Structure

Structure Requirements

  • The export office structure must reflect the company's strategic objectives and required resources.

    • Focus on logistical elements with robust control systems.

    • Continuous liaison with overseas buyers is essential.

    • High priority on marketing and the necessity of an integrated organizational structure emphasizing buyer empathy.

    • Note that the structure varies by company, location, and management culture.

Export Policy and Records

  • Continuous analytics are essential to identify weaknesses in distribution.

  • Importance of recognizing market opportunities, trends, and maintaining control.

  • Accessing desk research for:

    • New markets

    • Market changes

    • Trading regulations including customs, OECD country reports, EIU country reports, and trade associations data.

Export Office Organization Details

Structure Based on Company Size and Scale

  • The form of export organization varies based on the following:

    • Size of the company

    • Product type

    • Scale of export activities

  • Main functions of the export department consist of:

    • Marketing: Responsible for sales, pricing inquiries, product servicing, marketing functions such as promotions and market research.

    • Shipping/Logistics: Responsible for transportation, distribution, documentation, packaging, and labelling.

Table: Export Office Structure

  • Export Sales Manager

  • Export Director

  • Export Marketing Manager

  • Shipping Manager

  • Deputy Shipping Manager

  • Customs Traffic Officer

  • Liaison Officer

  • Air Freight Officer

  • Traffic Officer (ISO containers for areas including Far East, North America, Europe)

  • Logistics Executives (multiple roles based on specialization)

Conclusion

  • For further reading, consult:

    • Books: Export Management and Practice by Alan Branch, Chapter 2

    • Websites: www.imf.org, www.worldbank.org,

    • Guides: Guide to importing and exporting available for download from the HMRC website.