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Tips and Tricks in Export Financing

Market Access Requirement

To enter an export market, the stages of export business and Export Market Entry Requirements (PMPE) shall be considered.

The Stages of Export Business:

Stage of Export Business

To be able to determine the Export Destination Country (NTE) which is suitable for product export, analysis is required in advance so that exporters can avoid the losses that may arise from unconformity of export strategy. The followings are the steps to be done in order to determine the Export Destination Country as well as its strategies.

  1. Exporter determine the goods to be exported and the Export Destination Country
  2. Exporters conduct research and market studies, market studies can be performed using the available literature, then the analysis can be performed using SWOT Analysis, which is a method in form of matrix that compares weaknesses, strengths, opportunities and constraints that arise from a combination of export products with export destination country.
  3. After conducting studies, it will result in a combination of product-market which is considered suitable by the Exporter.
  4. Because the market has been identified, the next stage is to determine the export strategy. The export strategy shall consider:
  • Market segment of the NTE
  • Product to be marketed
  • Identity
  • Price
  • Distribution
  • Promotion
  • Trading Partner
  1. Using this export strategy, the Exporter will be easier in determining a business plan, which includes a schedule of activities, the financial plan (cash flow, profit & loss)
  2. After further targeted, the Exporter then can begin to determine the feasible export business procedure, which includes export financing, export procedures and export payments.
  3. If this strategy is deemed less profitable then the Exporters can review where the fault is, thereby determining the export strategy will be further optimized that it will minimize financial loss.

If the Export Destination Country has determined next thing to consider is the Export Market Entry Requirements (PMPE) consisting of:

  • Import duties and quotas
  • Requirements based on NTE laws
  • Requirements outside NTE
  • Specific requirements from the buyer

By performing the prior analysis to product being offered and its export destinations, it is expected to strengthen the exporter planning process in case of financial planning and marketing planning, so that exporters can avoid unnecessary costs.