How to Choose the Right Product for Export, and why it is Important
To develop an effective export strategy, you must identify the product. This is a great idea for anyone who wants to diversify their business.
The product is the key to your export success. If you have a product that foreign buyers love, everything else will follow. Exporting is a difficult and critical decision.
It is vital to know which exports you can export. But it’s equally important to be aware of what exports you cannot export. There are a number of restricted or prohibited items that India cannot export. The Directorate General of Foreign Trade’s (DGFT) website has an up-to-date list of these items. Other than these items, it is your decision to decide which products to export.
These are some of the things you can do to help you choose an export product.
Find Unique Products made in India
What are India’s most recognizable products? What about your state’s most famous products? Which are the most important exports from your state What countries import from us? This will answer every basic question. You can see the trends and patterns of our country’s past exports, as well as that of your state. This information is available in the public databases of DGFT or the Ministry of Commerce. An analysis of India’s Trade Statistics will provide you with an insight into the products that India sells as well as the reputation of those products abroad.
Analyze Demand and Supply on Global Market
You may have some products already in mind when you begin exporting. It is worth getting more details about the product as well as its supply chain. These details include the production process, where it came from, who its producers were, what its components were, whether seasonal demand is high, how to meet it, how to promote it, and if any guarantees or replacements are available. Different questions will be asked depending on what product you are buying. It is essential to know how much demand your product has and how fast it can be fulfilled.
Choose a country where there is a steady market for your product
It is vital to ensure your product is always in demand. The best markets for your product should be identified in those regions. Exporting tea from India into a country that doesn’t like coffee might not be a good idea. Find out about the political, economic, and social climate in your target country to ensure the growth and sustainability of your business.
Potential for Growth
It is vital to assess the growth prospects for your company. One possibility is that you export a product only to one place, but there could be demand in another location. Your product could be manufactured in the country where it originated. Does your product reach a wider audience than the neighboring countries or the country? Stabilizing sales can negatively impact your export business. You must always keep in mind that your business should be sustainable for the future.
Profitability of the product
Your business should only select products that are financially viable. It is essential to find the most economic source of the product, and ensure that the target market is willingly paying fair prices. It’s also worth looking at how the product has performed in the past. Also, you should determine if the product is susceptible to seasonal and periodic trends. By estimating all costs, including logistical and product costs, you can calculate your profitability.
Trade Regulations
Each market has its own regulations and compliances. It is important that you are familiar with the laws of your destination nation. Examine the laws of your destination country to determine if there are restrictions on similar products and if there have been any heavy taxes or duties imposed upon imports. Find out more about India’s trading relations.
Competition
Your product or offer may not be unique and you could face stiff competition from businesses that export similar products from the same area. This is why your product must be unique and it should stand out from the rest. Your product USP could be a better product, a lower price, better after-sales support, or any combination thereof. You should be cautious about lowering your prices. While this might temporarily increase your profit, it could eventually lead to a decrease in it. It is possible that you will need a different USP in the long term.
Once you’ve identified the product you want, narrow down your markets to which it can ship. Consider the many incentives and benefits that might be available for you to trade this product.
Many experts can help save you time, find the right product to sell, and maintain good relationships with your business partners. The best DGFT Consultants can help you concentrate on your primary business. This will allow you to reduce time and increase productivity.
Authors Bio:
Mr. Mehul Goyal is a professional DGFT Consultant with experience of more than 30 years and specialized in the field and is offering DGFT Consulting Services all over India. He is working with many importers and exporters even before DGFT was instigated in the markets.
