Tapping into New and International Markets: Methods, Documentation, and Recommendations

TAPPING INTO NEW AND INTERNATIONAL
MARKETS
INTRODUCTION
International trade is the exchange for goods and services across the
international borders where the proper services can be exported to the
customers as per their needs and requirements. To expand the market or
exporting the goods and services across the global market requires
adopting and understanding of the areas of the exporting practices from
where an individual organization can grow and trade their goods in
definite manner (Kazungu, 2020). The report will illustrate the
advantages and disadvantages of the types of exporting processes and
also mentioned the essential documentation which is required for the
trading. Along with this, different methods of international markets
including its limitation and benefits and some appropriate
recommendations will be mentioned in regard with achieving the
business requirements.
Advantages and disadvantages of the different types of exporting
processes for exporting merchandising and services
Exporting is the process of selling goods and services to another country
where it is called as exportation process (Alekhina and Yoshino, 2018).
There are different kinds of exporting methods an individual company
or an organization can use from where they can obtain the profitable
outcome and results efficiently. The HSBC organization can use the
different exporting methods where they should firstly grab the
knowledge of the advantages and disadvantages of the exportation and
trading internationally.
Advantages
 From the exporting services, HSBC can significantly
expand their business in new market and do not have to
depend on any particular one.
 Expansion of business will provide the different and
valuable opportunities and support the organization to lead
in larger economies of scale with better margins.
 Exporting will also benefit the company HSBC to mitigate
the risks as it will diversify the products and services
according to the customer and protects their business areas.
Disadvantages
 The company only has to think of exporting and trading
merchandising when they already collected the relevant
information and have their focus on existing markets and
customer.
 Have to manage remote relationships
 Can provide the disruption in supply chain management
and can increase the risk for the business growth and
development.
 Documentation and export licensing is also one of the
major consideration where proper follow-ups of rules and
regulation is essentially required.
The documentation that is required
essentially
Custom document includes the essential
reports which is required to be adopted and
created while exporting the goods and services
which includes:
Letter of credit: It is a written document
which is issued by bank on importer’s behalf
where exporter assures that thee issuing bank
will provide and pay the payment to the
exporter for the global trade performed
between the two parties (Rahmani, Esmailpour
and Naami, 2020). It is important because it
ensure that an individual exporter will receive
the full amount which helps them to plan their
future business.
Packing list: A packing list refers as an
information of all the materials and goods
which has been shipped or export to another
country where it is important to be mentioned
to verify the quantity and packages.
Commercial invoice: It is the legal document
or legal evidence of sale transaction which is
done between the buyer and seller
accordingly. It is used for the clearance reason
which helps in determination and assessment
of duties.
Terms of payment: It brief and detailed how
and when the customers pay for the goods and
services which has been exported by the one
country to another. Terms of payment is kind
of business expectation in regard with
payment and areas of penalties may receive
for missed payments.
Justified recommendations on appropriate methods and countries
to meet specific business requirements
The company HSBC wants to expand their business in global market
where the exporting and trading of goods and services is one the best
business they can do and apply for further growth and development.
However, HSBC company has been recommended to adopt the
partnership exporting method as it will allow them to take the decision
and investment on equal basis and can merge the ideologies of both
partners as common from where the appropriate and beneficial result
and outcome can be received.
An evaluation of the different methods of tapping into new
international markets, including its limitations and benefits
Direct Exporting: Direct exporting is the fastest mode of the exportation
of the goods and services to another overseas market (Asgharkhani and
Mohtaram, 2020). It includes the direct sale the production is done in home
country and affording better control over dispersion.
Advantages
 Can select the foreign representative in the international
market
 Utilize the direct exporting strategy to test and examine the
products in global market area before any greater and huge
investment
 It also helps to protect the trademarks and goodwill’s.
Disadvantages
 Higher start-up cost and provides higher risk as compared to
indirect exporting
 Needs higher investment of time and resources
Essentially required to collect and gather the information
appropriately
Partnership: A partnership method defined as where an individual
organization collaborate with another firm which is located at another
country then partnership method will help them to obtain the outcome at
profitable level (Maes, Dewaelheyns, Fuss and Van Hulle, 2019).
Advantages
 Have a right to take decision partially and required concern
from each partner
 The investment will be divided equally and can obtain the
profit in larger margin area
 The political risk reduces as the presence of local partner have
the knowledge of local market and its business environment.
Disadvantages
 The company can face the culture differences as the both
partners belong from different cultures.
 A legal procedure can be complicated
CONCLUSION
The above mentioned report has concluded the concept
and understanding of the international trade market area
which an individual need to understand. The report has
included the advantages and disadvantages of different
exporting methods which the mentioned company can
utilise and grow. However, it also highlighted the
exporting documentation requirements along with
different expansion methods and its benefits and
limitations. In addition, an appropriate recommendation
has been performed which the company should utilise to
grow and develop themselves accordingly.
REFERENCES
Kazungu, I., 2020. Business Networking and Performance of Tanzanian
Handicrafts Exporting Micro and Small Enterprises: The Moderating
Effect of Home Market Export Incentives. Journal of Co-operative and
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Alekhina, V. and Yoshino, N., 2018. Impact of world oil prices on an energy
exporting economy including monetary policy. (No. 828). ADBI
Working paper.
Rahmani, S., Esmailpour, H. and Naami, A., 2020. Presenting the Model of
Exporting Clusters through International Entrepreneurship
Approach. Journal of Business Administration Researches. 12(23),
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Asgharkhani, T. and Mohtaram, R., 2020. Investigating the Effectiveness of
Characteristics of Exporting Companies, Characteristics of Export
Transactions and Experience in Trade Claims through the Intermediary
Variables of Trade Risk Management on Export Performance. (Case
Study: Pharmaceutical Exporting Companies in Iran). Journal of
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Maes, E., Dewaelheyns, N., Fuss, C. and Van Hulle, C., 2019. The impact of
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