A significant hurdle in the import-export business is determining the right market for your product. There are various factors you have got to require into consideration. The correct marketplace for your import export business needs to discover multiple factors such as demand, value, market price, overseas country political and economic situation, tariff barriers, etc. This article answers the core questions of every exporter’s mind.
How should an exporter proceed to find the right market
For selling a product with maximum profits, market research and product analysis are mandatory. An exporter must know where their product is highly valued and is efficient to swipe in loads of benefits. Here are the questions that’ll make you lead a successful import export business.
Where is the demand high?
An exporter has the best knowledge about their product, so this becomes their responsibility to search which country incorporates a high demand for the product. As an example, if you export seafood, you should know that the US is the topmost importer, followed by China. Similarly, Egypt is the world’s biggest importer of wheat. Wondering how to find this data? There are websites run by government organisations providing all the related data.
Is the market stable?
An exporter should research whether the importing country produces the product they export or acquires the ability to manufacture it in future. For an import-export business, you should know whether your product gains demand in seasonal trends or is constant. An exporter should also be responsive to its rivals. You have to be sure that your competitors aren’t threatening your product demand because of any minor or major factor. A firm hold on the market is a crucial factor for any export business to ensure growth.
Is the product price profitable?
Deciding on the right price for the product is a challenge for exporters. If the price is high, it must accompany high product quality, quick delivery, appropriate packaging and additional benefits. Factors affecting the profitability of an export product are:
- Amount buyer is willing to pay for the product
- Additional costs that add to your export product, such as freight, terminal handling, clearance, loading- unloading, packaging, insurance, guarantee/warranty, marketing, etc.
- There are customs and excise duty refunds, export assistance schemes, and export credit facilities that can reduce the price of your export product.
- Price offered by your competitors for the same product.
Are there any trade barriers?
There are situations when exporters face trade barriers while exporting to some countries. These can be tariff restrictions or non-tariff barriers such as bans on specific goods and services, requirements of special licensing, imposition of import quality regulations, labelling, testing, and certification. For instance, Indian mangoes were ban by the European Union in 2015 due to the fruit flies in consignments. However, later the ban was lifted.
To avoid facing trade barriers, you can export to countries with which India acquires a bilateral or multilateral trade agreement offering relaxations and conditions for mutual benefit. There are various countries that provide incentives for imports to overcome their domestic scarcity.
Is the importers’ situation business-friendly?
Exporters must analyse the economic and political situation of the importing country. Search for signs of unpredictable political and economic situations that can be a threat to your prospects.
All these factors require an in-depth analysis and prediction of experienced individuals. For an exporter with high aims, it's advisable to seek the guidance of DGFT experts. DGFT Consultants are waiting eagerly to serve your purpose with their experience and excellent import-export service skills.
A few useful tips
An exporter should have a well-designed business plan before stepping out in search of potential buyers. Be ready to meet up the demands the new market will put forth. Your website must be able to be translated into the language of the country you target. Along with this, be well aware of the customs and cultures of the target country so you can build a personal connection with them. Have a direct one-on-one conversation with your buyer for their satisfaction. You must create a reputed image to maintain a firm base and expand your business.
EPCG Scheme for exporters
The Export Promotion Capital Goods (EPCG) Scheme is a duty-free ( zero customs duty) Import of Capital Goods/ Machinery for manufacturing export products.
Businessmen generally compromised on the quality of the goods because of the heavy customs duties levied on the import of capital machinery for production requirements. The higher the price of machinery used to be, the higher the customs duty. This functionality had an unfavourable impact on the competitiveness and quality of manufacturing industries.
The Government of India (GOI), considering the issues faced by the importers and exporters, issued the EPCG Scheme which allows the import of capital goods at zero customs duty.
The EPCG Scheme purpose is to improvise & enhance Indias competitiveness and presence in the manufacturing sector. Thus, to accumulate EPCG License and utilise it for innumerable benefits exporters can seek guidance from DGFT Consultants who are well trained and experienced in the field.
