PREPARING FOR

EXPORT
_- Understanding the 5 levels of
International Business
- The Organization & the Export Process

5 Levels of International Business

Accidental Exporting

5 Levels of International Business

Accidental Exporting
Selling product domestically to an international
exporter

5 Levels of International Business

Active Exporting

5 Levels of International Business

Active Exporting
Main activity is to buy product for export market and
distribution
Good knowledge and relationship with customs
brokers and host government regulations

5 Levels of International Business

International Marketing

5 Levels of International Business

International Marketing
Committing money and people to an international
market. Promoting and selling activities in a foreign
land
Either with company personnel or through licensing

5 Levels of International Business

International Production & Distribution in
Foreign Market

5 Levels of International Business

International Production & Distribution in
Foreign Market
Setting up a distribution/warehouse facility in an
international location
Committing money and people to creating a
distribution function in a foreign land
Usually includes warehousing activities.

5 Levels of International Business

Foreign Direct Investment

5 Levels of International Business

Foreign Direct Investment
Creating an MNE
Investing in both production and marketing in a
foreign land
Setting up a foreign division or head office.

The Export Process

* Create organization
* Seek information on export
market: Market Research
* Create marketing plan & Assess
Risk: INCO Terms
* Assess regulations: Barriers to
Trade
* Create export operations:
$ Investment
* Implement

AN ORGANIZATION FOR
EXPORT
Top Management Commitment - A key success
factor required for exporting

AN ORGANIZATION FOR
EXPORT
Top Management Commitment - A key success
factor required for exporting
Corporate objectives
Need to expand
Growth strategies related to Profit

AN ORGANIZATION FOR
EXPORT
Assess Company's Export Potential
Does it have:
Mkt. knowledge and research in the foreign land
Established links to customers/agents/governments

Match strengths
Create Organization to eliminate weaknesses in
Exporting

AN ORGANIZATION FOR
EXPORT
Assess Company's Export Potential
Does it have:
Mkt. knowledge and research in the foreign land
Established links to customers/agents/governments

Match strengths
Create Organization to eliminate weaknesses in
Exporting
Acquire Expertise in Exporting

AN ORGANIZATION FOR
EXPORT
Allocate production resources to export
Budgeting requirements
creating decision-making for export
Assessing risk in exporting

AN ORGANIZATION FOR
EXPORT
Allocate production resources to export
Budgeting requirements
creating decision-making for export
Assessing risk in exporting
Create separate, stand alone
Division/Department for Exporting

DETERMINING
ORGANIZATIONAL POSITIONS
FOR EXPORT
Export Manager - Duties:
overall responsibility
Planning and organizing resources for export
gaining commitment from senior management for
export
develop & execute export marketing plan
determine levels of control

DETERMINING
ORGANIZATIONAL POSITIONS
FOR EXPORT
Export Manager - Duties:
Direct Promotion and sales activities for export
Decide distribution partners
Negotiate distribution contracts
Implement procedures for product re-design and
verification of foreign packaging and labeling
requirements.

DETERMINING
ORGANIZATIONAL POSITIONS
FOR EXPORT
Export Manager - Duties:
Implement documentation and quality checks on
accuracy
Partner with Customs Brokers and government
officials in Home and Host countries.

DETERMINING
ORGANIZATIONAL POSITIONS
FOR EXPORT
Export Manager - Duties:
Staffing resources include:
language
24 service
technical communication
Internet/e-mail skills
automatic reordering skills

ASSESSING EXPORT MARKETS

Things to consider:
Mkt. size
Market ability to pay
Infrastructure
Advertising customs and practices

ASSESSING EXPORT MARKETS

Things to consider:
Trade Barriers
Currency Risks
Customs rules and practices
Transportation modes and costs

ASSESSING EXPORT MARKETS

Things to consider:
Product Suitability
Competition in Host country
Limited purchasing Power
Currency of business.

ASSESSING EXPORT MARKETS

Canada's Trade performance with other countries
help to determine potential market.
Thus assessing surplus/deficit flows will help
identify areas Government will help

Importance of Export to Canada

Import / Export Trade
North America in
percent

90
80
70
60
50

Imports
Exports

40
30
20
10
0
US

Mexico

Other

Recent Negative impacts on

Canadian Trade
EU Debt issues
Weak Chinese
economy
Weakening $Cdn
Plunging Global Oil
prices
Terrorism & US
Homeland Security
US Presidential
election