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The Prospects of Exporting: Looking beyond the Eritrea Investment Conference

Much to the expectations of all of the conference participants, the Eritrea Investment Conference, which took place on 27-28 August 2012, at the Asmara Palace concluded exultantly. Among the papers presented and some of the constructive ideas put forward by the participants, there was the urge to draw the attention of the prospective investors in the business of Exporting.

Economic statistics reveal that Eritrea is more of an import oriented. There is a negligible activity in export trading. It will be high time if much focus is exerted on export trading. Export led economic growth is much sought to boost the rise in the standard of living.

At this moment in time it is hoped that attempts of sharing some of the modes ideas on the essentials of exporting would shed some interest on the prospective investor.

In principle Exporting could be a highly specialized strategic planning that would trigger and encourage the business person to look beyond the domestic market. Exporting would enable the business person to enlarge the scope of the business person’s trade. If it is managed professionally the opportunities for growth would be remarkable. On the other hand, however, exporting is not easy. In fact, it is more complicated, more risky and more expensive than operating on the domestic market.

Export management job is even more difficult when it comes to selling to customers abroad. In theory international business follows the same methods as used domestically, but in practice it differs – simply because the customers are different from what the business person is used to. It is an overseas trade, thus it requires the need to know the requirements of customers different from those who are already known to the business person in the domestic market. 

In the overseas market the needs of your would-be customers are different, the methods to promote your products or services differ, and the methods to get your goods to the customer differ. Since your success is measured by the customer’s satisfaction, you will find yourself changing your company, the products, your workers – and in the end, yourself

The problem in developing countries however, is that business people basically fail to sustain the activities of exporting. Subsequent to their one time attempt they are obliged to suspend for there will be no more demand to their product or services. The defensive excuses they would give for their inability to keep on exporting would simply be for technical reasons. In most cases it could be because they would simply rush in without adequate preparation and lack of know-how on the intricacies of exporting. Therefore most of the business people would resort into the comfort zone of importing when involved in international trade. They would try to avoid the complexities of being involved in exporting.  
The business of importing is easy as far as the importer is concerned. It would be as simple as placing an order for a specific consignment and wait for the arrival of the consignment. Looking at the other end the business of exporting is tough. The exporter would have to undergo through many legal and financial procedures to ensure that the goods are delivered in apparent good condition. In between there are many players involved in the contract of sales.

The importer would hardly realize the complexities that are encountered by his Exporter/shipper/supplier. Moreover in developing countries importers rarely are knowledgeable of the powers they have over the exporter/shipper. The importers feel as if they are at the mercy of the exporter at the other end. The reality, however, is to the contrary. By virtue of the legality of the international contract of sales, importers are powerful and have the control over the exporter/shipper. Yet such powers are rarely exercised in developing countries. They consider it as simple routine matters. Looked at it seriously the importers have to expect the agreed quantity and quality of their goods to be delivered in time for whatever amount of money they have outlaid in foreign currency. They have even the right to reject the goods if the quantity and quality does not meet the terms in the contract agreed upon.

If the importer or any new entrant in the business of international trade would is determined  to hold the reins of exporting he/she ought to realize the need of having a good knowledge of a) International strategic Marketing, b) the international sales contract c) banking system d) contract of affreightment e) Marine insurance f) surveillance of quantity and quality g) packing h) Export pricing I) Terminal handling charges j) International Commercial terms k) Sharing responsibility in P&I matters l) Maritime law m) bulk shipment and chartering n)ISO standard. This is to indicate that it all requires multi-faceted activities and thus a concerted effort is the order of the business game. 

An organization can deal directly with the importer if it has highly trained and experienced staff. Alternatively it would be advantageous to seek the services of other organizations which have the professionals in the field.

What could be discernible here is that the inability to sustain on the business of exporting emanates literally from the incomprehensible activity of the importer in realizing the powers that one could have over the Exporter. In a similar trend when one would attempt to export primary or manufactured goods to an overseas importer, the exporter would take it for granted that his products would simply be accepted without any complaint whatsoever. In the event of rejection or lack of subsequent orders by the importer, the exporter would be taken by surprise. The exporter will even fall short of conducting any further research as to why his product is not demanded further.

The prospective exporter has to realize that he/she has to go to great lengths to satisfy the needs of the overseas importer. As there are tough competitions domestically there are even more tough challenges in the overseas market. Basically it is not even so easy to penetrate a rather saturated market, if any. Exporting to highly industrialized countries requires more caution as there are strict regulations that imported goods have to abide by the given the standard set by the importing country.

If the exportable items are perishable, (as is common in developing countries for mostly primary products are exported), utmost care has to be taken in having the convergence of the timing of collecting from the farmland, and having them shipped with the fastest mode of transport. In the intervening time, however, bookings and all the paper works should be finalized.  The end result is to satisfy the importer that his goods are received in convenient time to remarket them domestically. It is therefore apparent that the exporter will have almost sleepless nights until his consignment is delivered in time. It would be the best services for the importers money expenditures. Whatever quality products an exporter is in a position to offer to the overseas market unless it is coupled with efficient services the demand for his product will be short lived.

While on the subject another category in the export sector that can be highly strengthened is tourism or the invisible export. Concerted efforts in this sector would capitalize in the collective benefits that can be reaped in a relatively shorter period. In saying this it should not be taken for granted that this invisible export could run with out flaws. The performance of a single person matters in this regard. If the visiting tourists could be considered as imported ones they will observe what services the host individual and the organization has offered them during their stay. When returning back to their origin of destination they will be the export one. They will take with them the export paraphernalia that an individual, an organization and in general the country has in store. Apparently they will disseminate all of their evaluations to many of their acquaintances. Some would even post it in their website. If one is sensitized about the fragility of this invisible export one should realize the after effects depends solely on the unreserved excellence of services one is prepared to demonstrate.

Like any export commodity, tourism, or the invisible export, has many actors in the pipeline. It is the concerted efforts of all the players that can render the country a very attractive export commodity that will make any visitor to return again. The news will spread like a forest fire and many who are yet to visit the country would long to see, at least once in their life time, such a highly acclaimed country worth visiting.

Carefully considered, an expert and skillful handling of the business of exporting, whether it is tangible or intangible, will give rise to a reasonable return of benefits.

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