PROBLEMS FACING POTENTIAL EXPORTERS 1 In order to be successful,

Man: Good morning, ladies and gentlemen. I’m honoured to have this opportunity to talk to you. My name is Tony Brown, and I’m Chief Executive of the Marketing Research. Many firms fail because when they begin exporting they have not researched the target markets or developed an international marketing plan. To be successful, a firm must clearly define goals, objectives and potential problems. Secondly, it must develop a definitive plan to accomplish its objective, regardless of the problems involved. Unless the firm is fortunate enough to possess a staft with considerable expertise, it may not be able to take this crucial first step without qualified outside guidance.
    Often top management is not committed enough to overcome the initial difficulties and financial requirements of exporting. It can often take more time and effort to establish a firm in a foreign market than in the domestic one. Although the early delays and costs involved in exporting may seem difficult to justify when compared to establish domestic trade, the exporter should take a more objective view of this process and carefully monitor international marketing efforts through these early difficulties. If a good foundation is laid for export businesses, the benefits derived should eventually outweigh the investment.
    Another problem area is in the selection of the foreign distributor. The complications involved in overseas communications and transportation require international distributors to act with greater independence than their domestic counterparts. Also, since a new exporter’s trademarks and reputation are usually unknown in the foreign market, foreign customers may buy on the strength of the distributing agent’s reputation. A firm should therefore conduct a thorough evaluation of the distributor’s facilities, the personnel handling its account, and the management methods employed.
    Another common difficulty for the new exporter is the neglect of the export market once the domestic one booms: too many companies only concentrate on exporting when there is a recession. Others may refuse to modify products to meet the regulations of cultural preferences of other countries. Local safety regulations cannot be ignored by exporters. If necessary modifications are not made at the factory, the distributor must make them, usually at a greater cost and probably not as satisfactorily. It should also be noted that the resulting smaller profit margin makes the account less attractive.
    If exporters expect distributing agents to actively promote their accounts, they must be trained, and their performance continually monitored. This requires a company marketing executive to be located permanently in the distributors’ geographical region. It is therefore advisable for new exporters to concentrate their efforts in a few geographical areas until there is sufficient business to support a company representative. The distributor should also be treated on an equal basis with domestic counterparts. For example, special discount offers, sales incentive programmes and special credit terms should be available.
    Considering a joint-venture or licensing agreement is another option for new exporters. However, many companies still dismiss international marketing as unviable. There are a number of reasons for this. There may be import restrictions in the target market, the company may lack sufficient financial resources, or its product line may be too limited. Yet, many products that can compete on a national basis can be successful in the majority of world markets. In general, all that is needed for success is flexibility in using the proper combinations of marketing techniques.