Export Product Selection
Export product selection is an important factor in the export of any country. The selected product must be exported to countries where it is in demand. Some products are sold more than others in international markets. Choosing an export product using different market research tools is not very difficult. Such products will always have more sellers and thus more competition and lower margins. Starting or developing any business by exporting products may help it grow.
Important and Key Factors to Choose the Best Product for Export
1. Our manufactured product must be produced with standard quality or comparable to our competitors. Obtaining an ISO certificate or its equivalent helps to sell the product in international markets.
2. If possible, it is better to avoid products that are monopolized by one or more suppliers. If we are a manufacturer, make sure that we have enough capacity at the source or we can outsource it on time. Timely delivery is a key factor in export success.
3. The price of the export product should not fluctuate much. This issue threatens the profitability of the export business.
4. Let’s examine the government’s policies related to the export of a specific product.
5. Study import regulations in foreign markets, especially tariff and non-tariff barriers.
6. registration or presentation for our products in the importing country; This is important for processed foods and beverages, drugs and chemicals.
7. Consider the seasonal changes of the selected products; For example, some products are sold in summer and others in winter.
8. Consider packaging and labeling for perishable products such as processed foods and dairy products.
Effective Factors in Selecting the Right Export Product
The first step for a manufacturer or distributor to enter the export field is to choose the best product to export to international markets. Because the choice of export product is important for success in international trade and export trade. These factors are:
1. Export Process
We can identify products or product groups with potential in foreign markets by analyzing the export trend in terms of country and commodity over a certain period of time.
2. Production Capacity and Product Availability
To choose the best product for export, the exporter must choose those products for which there is a suitable production capacity and the product can be produced in the desired quantities.
3. Product Compatibility
A product may have great market potential. Physical conditions, functional requirements, cultural factors, diverse tastes, skill levels and levels of technical advancement may vary. And for this reason, it requires making changes in the product to offer in each market. In this way, the product that will be offered for each market, in terms of design, color, size, taste, packaging, etc., will be in accordance with the consumer’s preference and market conditions.
4. Trade Restrictions
One of the factors that should be considered to determine the best goods for export is the discussion of trade restrictions. Any country may impose restrictions on the import of some products from other countries in the form of licenses or other quantitative restrictions.
Most of these restrictions have been aimed at protecting the environment, children, public health and public safety. Countries even resort to non-compensable duties or guarantee duties to protect their domestic industries.
5. Changing Spending Patterns
In addition to the individual’s preference, the amount of consumer purchase of a product will be strongly affected by the price of the product compared to the price of other similar products and the consumer’s income.
If the consumer’s income increases, the demand for most goods will increase. Demand for goods that people consider necessary, such as fuel, tobacco, bread, and meat, decreases, and exporters of these products do not benefit much from rising consumer incomes in other countries, and in such a situation, demand for luxuries such as new cars or expensive food It increases at a faster rate.
Due to the change in cost patterns in response to the increase in income, exporters should place more emphasis on goods that consumers call luxuries. On the contrary, with the decrease in income, the demand for luxury products has decreased, and essential goods have become the priority of people.
6. Attention to Quality and Marketing Selection
Studies of import and export trade show that companies that have consistently increased their sales and overall profits have emphasized quality.
Up To Sum
Selecting the right product to carry out export activities is a decisive factor in the success of export operations. For such a selection, various components can be examined, such as: product compatibility, commercial restrictions, export trends, etc. Therefore, before entering international markets in the form of exports, we must ensure the profitability of exporting our desired products by conducting field research.