All of countries around the world seek to expand trade relations with each other and they export and import goods directly and indirectly. Some countries’ economies depend on these trade relations. In this article we will discuss export of goods especially indirect exportation of goods.
How has been exportation of goods in recent years?
Due to the competitive environment between countries in trade and commerce, this field is constantly growing and developing. International trade has been growing in astonishing rate in recent years, making it even more exciting than ever before. Among the series of factors that have contributed to the growth of countries in this field are the establishment of the World Trade Organization, trade successes between countries, trade integration in Europe, the growth of emerging markets such as China, India, Turkey, etc.
Everything mentioned in this paragraph are of the reasons why commercial markets are becoming more exciting in the current era. Trade relations were limited to countries, and international trade was limited to a limited number of multinational corporations before. But today, thanks to the Internet and low-cost advances in business technology and easier access to information, significant changes have taken place in international trade in addition to large and multinational corporations, small and start-up companies can operate in this field too.
What is Exportation?
Exportation means sending and selling goods abroad. This method is done with minimal capital and without high risk since there will be no need for huge financial resources to set up a store in other countries to offer your products. Exportation is generally done in two ways, direct and indirect, which we will explain in following paragraphs.
In the direct exportation method, which is done between an importer and an exporter, there is no third party and the importer and exporter are related. This method is very suitable for manufacturers who are looking for development and progress.
In indirect exportation method, there are several intermediaries for selling goods and products in other countries. Based on the definition of this type of exportation, it can be said that the simplest method in trade is indirect exportation method. Because in this method, there will be no need for such expertise and costs. The indirect export method is more suitable for new companies in this field. Indirect exportation is done in two ways: exclusive and dependent methods, which we will explain in the following.
Exclusive Indirect Exportation
A private company that is established in one country and operates as the export department of several manufacturing companies and is commissioned by manufacturers to receive orders and carry out export transactions. These companies typically own the goods and take business risks Our advice to you dear ones is to get help from the company in export management as long as you are not familiar with the rules and regulations of importation and exportation and you are considered a novice.
Dependent Indirect Exportation
Exportation means the distribution of goods abroad. In this way, your products and those of other manufacturers are sold together. Manufacturers and companies whose products are related and complementary to each other but are not competitors can use this method to sell their products. For example, you are a manufacturer of nail polish, but you have not yet started exporting your goods, in order to export and sell without risk, you ask a company that produces and exports cosmetics to other countries for cooperation in exporting your products with the products of that company. Usually these companies will be interested in working with you to improve and complete their export package to other countries because it will be without capital or with the least capital. In this way, the cosmetics company will benefit from this by receiving a fee from you or increasing the price of the nail polish.