Also found in: Dictionary, Thesaurus, Idioms, Encyclopedia, Wikipedia.
exportingthe sale in an overseas market of a product which is produced in the firm's home market.
Exports may be viewed by the firm as merely an extension of home sales, serving to provide extra business as a means of allowing the firm to operate its productive capacity to the full. More fundamentally, exports may be regarded as an important profit centre in their own right, providing the firm with opportunities for worldwide sales expansion and long-term profit growth.
Exporting may be undertaken indirectly or directly. Indirect exporting involves the contracting of independent agents to establish wholesale and retail sales contacts, and importers/distributors to handle the physical distribution of the product. Often, however, independent agents/distributors lack the commitment or resources required to maximize the firm's overseas sales potential. For this reason direct exporting may be preferred, requiring the appointment of the company's own overseas sales personnel and the establishment of overseas sales offices, depots and sales subsidiaries to handle local distribution and marketing. Exporting may be conducted on a ‘standalone’ basis or, as in the case of MULTINATIONAL ENTERPRISES as part of a more complex FOREIGN MARKET SERVICING STRATEGY involving also licensing and overseas production.
The physical act of transporting goods to export markets may be done by the supplier's own distribution division or by using the services of independent hauliers, fleet operators and FREIGHT FORWARDERS. Documentation required in connection with export consignments includes a BILL OF LADING, CERTIFICATE OF ORIGIN, WEIGHT NOTE, INSURANCE and (where appropriate) an export licence. Exporting may be undertaken according to a FREE ON BOARD (f.o.b.) contract, a COST, INSURANCE AND FREIGHT (c.i.f.) contract, or a COST AND FREIGHT (c&f) contract.
Export finance is provided by the commercial banks in the form of short-term credits (often underpinned by LETTERS OF CREDIT) and backed in the UK by the government's EXPORT CREDITS GUARANTEE DEPARTMENT (ECGD), FACTORS and FORFAITING HOUSES.
In addition to the ECGD, the Trade Partners organization (which incorporates the trade and overseas divisions of the DEPARTMENT OF TRADE AND INDUSTRY (DTI, and the Foreign Office) provides various facilities to support UK exports including:
- the Export Market Information Centre which provides, amongst other things, access to the British Overseas Trade Information Services worldwide statistical database, market research reports, directories, etc. and an Export Intelligence Service (for subscribers only) providing detailed, up-to-date market and product databases;
- the Export Marketing Research Scheme which provides professional advice and research on overseas markets, and financial grants to cover exploratory missions;
- Technical Help to Exporters which provides information and advice in respect of overseas technical standards, national laws covering safety and environmental protection, etc.;
- the Fairs and Promotions branch which organizes and financially assists exhibitors at overseas trade fairs, sets up contacts with agents and distributors, etc.;
- the Supplier Trade Procedures Board which provides advice and assistance in preparation of export documentation and provides a system for sending documents by electronic data interchange instead of using paper documents;
- the Projects and Export Policy Division which provides contacts with overseas governments and companies, and ongoing support for large overseas projects such as power station, railway networks, pipelines, etc.;
- finally, the Trade Partners provides information and advice on tariffs, local duties and exchange controls, and in the case of certain specific exports is responsible for issuing export licences. See CUSTOMS AND EXCISE, INTERNATIONAL TRADE, INTERNATIONAL MARKETING, CHAMBER OF COMMERCE, SUBSIDY, CONSIGNMENT.