Table 1
Management Issues Involved in the Export Decision
Management Objectives
- What are the company's reasons for pursuing export markets? Are they
solid objectives (e.g., increasing sales volume or developing a broader,
more stable customer base) or are they frivolous (e.g., the owner wants
an excuse to travel)?
- How committed is top management to an export effort? Is exporting
viewed as a quick fix for a slump in domestic sales? Will the company
neglect its export customers if domestic sales pick up?
- What are management's expectations for the export effort? How
quickly does management expect export operations to become
self-sustaining? What level of return on investment is expected from the
export program?
Experience
- With what countries has business already been conducted, or from
what countries have inquiries already been received?
- Which product lines are mentioned most often?
- Are any domestic customers buying the product for sale or shipment
overseas? If so, to what countries?
- Is the trend of sales and inquiries up or down?
- Who are the main domestic and foreign competitors?
- What general and specific lessons have been learned from past export
attempts or experiences?
Management and Personnel
- What in-house international expertise does the firm have
(international sales experience, language capabilities, etc.)?
- Who will be responsible for the export department's organization and
staff?
- How much senior management time (a) should be allocated and (b)
could be allocated?
- What organizational structure is required to ensure that export
sales are adequately serviced?
- Who will follow through after the planning is done?
Production Capacity
- How is the present capacity being used?
- Will filling export orders hurt domestic sales?
- What will be the cost of additional production?
- Are there fluctuations in the annual work load? When? Why?
- What minimum order quantity is required?
- What would be required to design and package products specifically
for export?
Financial Capacity
- What amount of capital can be committed to export production and
marketing?
- What level of export department operating costs can be supported?
- How are the initial expenses of export efforts to be allocated?
- What other new development plans are in the works that may compete
with export plans?
- By what date must an export effort pay for itself?
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