The world markets have changed enormously in the past decade. New markets have been opened with the end of cold war. New economic blocks have been formed. New trading alliances are shaping. Inevitably, a new way of thinking and approach to doing business is necessary in order to survive in the fast changing economy.

Exports are key to the economic survival of a nation. A nation that exports more will grow stronger. The stronger a nation is, the more recognition and respect it will earn.

Increased Worldwide Competition

There can be no growth without competition. As the world population grows, which is estimated at a rate of 1.7% annually, more products and services are needed. Business people worldwide are keenly competing to fill these needs. World trade grew in volume at an average of 5% annually over the past 25 years. With the end of cold war, more resources worldwide are geared towards exporting. The export business has become more competitive. Exporting becomes more challenging with continued population growth and the addition of new exporters.

Effects of Social Upheaval and Recession

Any form of instability in a country can ruin its economy and may place its international trade in disarray. With the end of cold war, the earth has become a more peaceful place to live. However, an alarming occurrence is the growing number of permanent lower class in numerous countries, including in developed nations. The adverse effect of social upheaval is paramount. It can undermine the economic progress of a nation. There is an urgent need to stop the growing number of the lower class. The task requires a concerted effort from the government and people. The task is not easily done.

The effect of recession is immense, businesses sink, dreams of a lifetime shatter, and the lower class increases. Vigorous export promotions, increase in exports, and diversification of export markets can help reduce the number of the lower class.

The use of terminology differs from country to country. The term salesperson is easy to decipher as the salesman or saleswoman, but it is a term that is unheard of in some countries. The account manager is the sales representative, the buyer is the purchaser, the accounting assistant is the bookkeeper, the human resources department is the personnel department, the flat is the apartment, the chop is the stamp, the motor carrier is the trucking company, and the letter carrier is the postman.

The first time one hears a person say "I will take the lift to third floor" can be baffling. Some people may misconstrue the lift for the lifting crane, short of suspecting that the lift is the elevator.

When a buyer asks "Excuse me, may I use your restroom please?" in the middle of a business meeting, do not bring the buyer to a room to rest. The buyer wants to use the toilet, not to rest. In certain places, the terms washroom, powderroom and latrine are used, instead of restroom and toilet.

The way certain terms and bland words are used in a language or a country can be offensive in another language or country. "Please give the officer overtime pay" sounds like a plain English parlance, but when it is used in some surroundings it means please give the officer a bribe. The term bribe also comes under the terms grease, grease money, coffee money, influence, under the table, open back door, little bite, and red pouch.

The term nova, which means a star, is commonly used in many countries. However, the word "nova" in Spanish means "no go", which carries a negative message when used in Spanish-speaking countries. It is important to use terms and words cautiously to avoid setbacks in exporting and importing.

Export-traders play a crucial role in international trade. Prior to the 1970's when export product quality was a common problem in many less developed countries, foreign buyers relied on export-traders for product sourcing and pre-shipment inspections. The nature of the order then normally was fewer items and more volume, that is, the number of items was few and the quantity of each item was large. At that time, many manufacturers did not know how to export, thus they relied upon export-traders for exporting, known as indirect exporting.

There were far fewer exporters worldwide before the 1970's. The foreign buyers then did not have many export sources from which to compare an offer. The export business was lucrative due to much less competition. As time progressed, competition built. The manufacturers competed on providing better quality products and lowering prices. The price war made the traditional practice of single source of supply difficult for export-traders to maintain. The export-traders changing the source of supply of similar products from one manufacturer to the other became inevitable. The manufacturers needed to survive and direct exporting was the solution. Many manufacturers started exporting directly in the mid-1970's.

Export product quality in general improved markedly in the late 1970's. However, the problem of quality remains a nightmare to some importers. During the oil crisis of the late 1970's, there was a significant increase in the number of manufacturers who export directly. Many foreign buyers deal directly with the manufacturers to save commission or fees and/or markups of export-traders.

In the early 1980's, the ordering trend became more items and less volume, that is, the number of items was many and the quantity of each item was small. This new trend made direct exporting unprofitable for some manufacturers. The more-item-and-less-volume trend, which enhances the popularity of indirect exporting, is best handled by the export-trader.

For a manufacturer to maintain its own export personnel is not economical in some countries. It is better to work with export-traders. For an importer to source and buy directly from foreign manufacturers can be uneconomical too.

Not all export-traders perform well. Importers may still encounter quality problems because of lack of inspection on the part of the export-trader, despite the fact that the exporter's pre-shipment inspection is required in the order. The inspection is an additional cost to export-traders. Importers must watch out for exporters who promise anything in order to obtain the order.

The telecommunication technology 'explosion' in the past decade has changed the way people interact around the world. With new technology on hand, some of our prime tools of export communication, for example telex (teletype exchange or teleprinter and exchange), have become obsolete.

The telex, like a fax (facsimile) or an e-mail (electronic mail), uses a telephone line in transmitting the messages. Telex was the 'e-mail of yesteryear'. But instead of a computer screen, you have a roll of paper, which may come in duplicate, triplicate or quadruplicate, either carbonless or the much older type having a carbon paper in between the sheets, where the outgoing and incoming messages appeared, that is, where the messages are typed. And instead of saving the typed message in a computer disk or hard drive, each alphanumeric character that was keyed (typed) in a telex, aside from appearing on the paper roll, is simultaneously translated and stored in a paper tape in coded form in a series of punched holes. Keying a wrong character may mean retyping the message from the beginning. The 'final' tape is rerun to send the message out or make additional copies of the message. The advantage of having a 'final' tape is to save the transmission time and cost. Or, you can send the message directly. Each character that was keyed (typed) will instantly appear at the receiver's end. Therefore, as long as the line is 'on', the sender and the receiver can 'talk' over the telex, that is, exchange messages over the telex while the line is 'on'.

Although the e-mail is popular nowadays, the fax remains as an important tool of export communication in many countries.

The letter mail remains important especially in the initial contact with a prospective overseas buyer.

In exporting, it is not a prerequisite for a business to sell to its domestic market before selling abroad. There are many successful export-traders and export-manufacturers, notably in Asia, who have been selling their products entirely to the foreign markets.

Exporting is not for large companies only. Contrary to a belief that only large companies can export, in fact there are more small and medium-sized companies than large companies in the world that are engaged in exporting. The size of a company is not static. Most large companies at one time were small companies. Not to mention, small and medium-sized companies are the leading source of job creation in many countries.

Prior export expertise is not a prerequisite to exporting. The export procedure and routine is easy to learn. There are many forms of export assistance or advice available from the government and the private sectors. The export related skills can be learned. However, prior exposure to international trade is a definite advantage.

• Export Phobia
• Export Mindset
• Types of Export Businesses
• Selecting Business Partners
• Home-Based Export Businesses