Post by Trade facilitator on Nov 12, 2019 21:18:43 GMT 1
With the expansion of the Internet, many businesses have now started to compete on a global scale. Whenever a business starts growing and expanding, entrepreneurs begin to strive to become more competitive, either by importing or exporting goods. In this article, we shall be considering the benefits of exporting goods to other countries.
Definition of International Trade
International trade is the exchange of capital, goods, and services across international borders or territories. Such trade represents a significant share of gross domestic product in most countries.
A product that is transferred or sold from a party in one country to a party in another country is an export from the originating country, and an import to the country receiving that product.
International trade is typically more costly than domestic trade. This is due to the fact that a border typically imposes additional costs such as tariffs , time costs due to border delays, and costs associated with country differences such as language, the legal system, or culture (non-tariff barriers).
When trade takes place between two or more nations, factors like currency, government policies, economy, judicial system, laws, and markets influence trade.
What are the gains of export?
Every business has its peculiar challenges, which is same with export business. However, the advantages of exporting by far outweigh the challenges or disadvantages. Analysed below are some the benefits of export:
1. Increasing Your Sales Potential
Exporting products increases sales and sales potential in general. Export is especially good for medium and large businesses. Exporting products abroad is a great opportunity for businesses to increase in sales potentials. Also, exporting can be one way of scanning opportunities for overseas franchising or even production. Businesses that focus on exporting expand their vision and markets regionally, internationally or even globally.
2. Profit Increase
Exporting products largely contributes to increase in your profit. This is mainly due to the foreign orders, as they are usually larger than those placed by the local buyers. While local customers buy a few products or a pallet, businesses abroad oftentimes order a container of products which inevitably leads to increased profits. Moreover, if your products are considered unique or innovative abroad, your profits can increase rapidly in no time.
3. Expand Life Cycle of Product
Typically, products go through various cycles namely introduction, growth, maturity and declining stage that is the end of their usefulness in a specific market. Once the product reaches the final stage, maturity in a given market, the same product can be introduced in a different market where the product was never marketed before.
4. Global Market Shares
Exporting companies will have opportunities to participate in the global market and gain a piece of their share from the huge international marketplace.
5. Economic Growth
The economy of exporting country will no doubt be developed. Nations with strong international trade have become prosperous and have the power to control the world economy. The global trade can become one of the major contributors to the reduction of poverty.
6. Promotes Peace and Goodwill
International trade fosters peace, goodwill, and mutual understanding among nations. Economic interdependence of countries often leads to close cultural relationship and thus avoid war between them.
Definition of International Trade
International trade is the exchange of capital, goods, and services across international borders or territories. Such trade represents a significant share of gross domestic product in most countries.
A product that is transferred or sold from a party in one country to a party in another country is an export from the originating country, and an import to the country receiving that product.
International trade is typically more costly than domestic trade. This is due to the fact that a border typically imposes additional costs such as tariffs , time costs due to border delays, and costs associated with country differences such as language, the legal system, or culture (non-tariff barriers).
When trade takes place between two or more nations, factors like currency, government policies, economy, judicial system, laws, and markets influence trade.
What are the gains of export?
Every business has its peculiar challenges, which is same with export business. However, the advantages of exporting by far outweigh the challenges or disadvantages. Analysed below are some the benefits of export:
1. Increasing Your Sales Potential
Exporting products increases sales and sales potential in general. Export is especially good for medium and large businesses. Exporting products abroad is a great opportunity for businesses to increase in sales potentials. Also, exporting can be one way of scanning opportunities for overseas franchising or even production. Businesses that focus on exporting expand their vision and markets regionally, internationally or even globally.
2. Profit Increase
Exporting products largely contributes to increase in your profit. This is mainly due to the foreign orders, as they are usually larger than those placed by the local buyers. While local customers buy a few products or a pallet, businesses abroad oftentimes order a container of products which inevitably leads to increased profits. Moreover, if your products are considered unique or innovative abroad, your profits can increase rapidly in no time.
3. Expand Life Cycle of Product
Typically, products go through various cycles namely introduction, growth, maturity and declining stage that is the end of their usefulness in a specific market. Once the product reaches the final stage, maturity in a given market, the same product can be introduced in a different market where the product was never marketed before.
4. Global Market Shares
Exporting companies will have opportunities to participate in the global market and gain a piece of their share from the huge international marketplace.
5. Economic Growth
The economy of exporting country will no doubt be developed. Nations with strong international trade have become prosperous and have the power to control the world economy. The global trade can become one of the major contributors to the reduction of poverty.
6. Promotes Peace and Goodwill
International trade fosters peace, goodwill, and mutual understanding among nations. Economic interdependence of countries often leads to close cultural relationship and thus avoid war between them.
