EXPORT MANAGEMENT

UNIT-1
SYLLABUS:

INTRODUCTION-COMPOSITION OF EXPORTS-TRADITIONAL
AND NON-TRADITIONAL-PRINCIPLE OF PRODUCTS OF
EXPORT,DIRECTION OF EXPORT TRADE-EXPORT POTENTINAL ANALYSIS
IN AGRICULTURE PRODUCTS,MARINE
PRODUCTS,TEXTILES,ENGINERING GOODS-SOFTWARE AND
INFORMATION TECHNOLOGY.
INTRODUCTION:

Export management is basically planning, organizing, coordinating and

controlling all activities relating to export of goods and services to other counties. It
involves various activities such as production of exportable good, collection of
orders from foreign buyers and their execution, publicity in abroad, adoption of
sales promotion techniques, price fixation and looking after various procedures and
formalities relating to exporting of goods. It is rightly said that export management
involves functions and activities undertaken by the department/ division of a large
manufacturing enterprise. The scope of export management is vast as everything
concerned with exporting comes within the scope of export management.

DEFINITIONS OF THE EXPORT MANAGEMENT:

The term export of management is rather difficult to define

precisely as it is dynamic in scope. Secondly, standard definition of the term export
management is not available as it is an applied subject. Here, the principles of
management are applied to the management of export trade/ marketing activities.
However, it is possible to note some simple definition of export management . Such
definitions are as noted below:
1. Export management means managing export marketing activity efficiently,
smoothly and in an orderly manner.

2. Export management means finding opportunities for marketing goods &

services in foreign markets and exporting such opportunists for the benefit of
an exporting firm, subject to existing export rules and regulations.

3. Export management is one specific area of business management and it is

concerned exclusively with exporting goods abroad. It is concerned with
international marketing activities and operations.

4. Export Management means planning, organizing, coordinating and control

export efforts or activities to achieve desired export objectives smoothly and
with continuance.

5. According to B.S.Bathor , “Export Marketing includes the management of

marketing activities for products across the national boundary or a country”
Composition of India’s Imports:

The top eight import items of India during April–

February of FY22 were:

• Petroleum crude & products (25.7 percent of total imports)

• Electronic goods (11.8 percent)
• Gold (8.2 percent)
• Electrical & non-electrical equipment (6.6 per cent)
• Pearls, semi-precious & precious stones (5 percent)
• Inorganic & organic chemicals (5 percent)
• Coal, coke, etc. (4.9 percent)
• Plastic materials, artificial resins, etc. (3.3 percent)

The composition of India’s imports is classified into three

categories as follows:

1.Raw materials
2.Capital goods, and
3. Consumer products.
Raw Materials:
Petroleum oil, edible oil, lubricants, iron and steel, non-ferrous
metals, fertilizers, precious stones, pearls, and other commodities are
contained in this category. 

Capital Goods:
This category contains non-electrical and electrical machinery,
locomotives, metals, other transport equipment, etc. These items help
in the industrial development of a country.
Consumer Products:

This category is made up of electrical items, medications, food grains,

paper, etc. India used to import enormous amounts of food grains until
its third five-year plan. Presently, India is self-reliant in food production.

India’s export composition can be divided into two categories:

* Traditional Product Exports
* Non-traditional Product Exports
Traditional Products:

Traditional items include the export of tea, coffee, jute goods, animal
skin, iron ore, cotton, minerals, fish and fish products, etc. These products
accounted for nearly 80 percent of our overall exports at the outsets of the
planning era. However, non-traditional items’ contribution is increasing more
rapidly since then.

Non-Traditional Products:

Engineering goods, chemicals, sugar, electrical goods, iron and steel,

gems and jewelry, and leather goods, fall under non-traditional items that are
exported by India.
Principle of export:
What Is an Export?
Exports are goods and services that are produced in one country and sold to
buyers in another. Exports, along with imports, make up international trade.
Instead of confining itself within its geographical borders, countries often
intentionally seek external markets around the world for commerce, allowing
greater revenue and transactional opportunities.

Understanding Exports:
Exports are incredibly important to modern economies because they
offer people and firms many more markets for their goods. One of the core
functions of diplomacy and foreign policy between governments is to foster
economic trade, encouraging exports and imports for the benefit of all
trading parties.
Export agreements are often heavily strategic, with countries exchanging
agreements to ensure their own country can not only receive the goods they
need via export but can distribute goods for more domestic revenue via imports.
Also, consider how governments may use exports as leverage over political
situations. In response to the war in Ukraine, the White House issued an
executive order prohibiting both the importation and exportation of certain
goods from Russia.
Companies often measure their net exports which is their total
exports minus their total imports. Net exports is a component of
measuring a country's gross domestic product (GDP), so exports
play a factor in determining a country's financial and economic well-
being.

Good may be sent via direct exporting or indirect exporting. Direct

exporting entails working directly with the importer. The exporting
company will handle all of the client communication; as a result,
they do not pay a middleman fee. Because the direct export method
may require teams with specialized knowledge, many companies
opt to contract out a middle party to facilitate an indirect export.

In 2021, the world exported almost $28 trillion worth of goods. $3.5
trillion of this activity came from China, the world's largest
exporter.1The World Bank. "Exports of Goods and Services."
The Export Process:

In many cases, a country will partner with another country to

understand the demand needs for certain products. Instead of
blindly manufacturing goods and hoping for an international
buyer, the export process often starts with the manufacturing
country receiving an order. The exporting country must often
receive proper clearance from their home country to export
goods; this is often done by obtaining an export license or
meeting other country-specific requirements.

The export process usually entails settling several financial

matters upfront. First, the exporter may seek out a letter of credit
from the importer if applicable. This ensures the exporter can
have greater faith in the transaction and will receive
compensation for the goods once exported. 
The exporter and importer also fix the exchange rate at which the
exported goods will be exchanged at from the foreign currency to the
home currency. At this point, an invoice is most often issued and paid
for, finalizing the sale.

As the order is prepared, formal documents are gathered including a

permit issued by the customers department, financial document such
as a bill of lading and shipping documents are prepared, and and
shipment advance information. These documents are remit to the
seller; of primary importance is the shipment advance which notifies
the importer how goods will be transmitted.
Pros:
1.Often allows for greater economic activity leading to
higher revenue
2.May result in production efficiencies due to scaling
manufacturing
3.May result in greater innovation and R&D through
working with foreign partners
4.May reduce operational risk in some areas as revenue
streams become more diversified
Cons:
1.May result in high transportation charges
2.May not be achievable by smaller entities due to lack of
knowledge and resources
3.May result in currency exchange risk due to devaluating
currencies
4.May increase operational risk in some areas due to
unknown political or geographical risks
What is Export Trade?

Exports are explained as the goods and services

manufactured in one country and acquired by citizens of another
country. The export of good or service can be anything. This trade
can be done through shipping, e-mail, transmitted in private
luggage on a plane. Basically, if the product is manufactured
domestically and traded in a foreign country, it is known as an
export.
In International trade, exports are one of the components.
The other component is imported which means the goods and
services purchased by a country’s citizens that are manufactured in
a foreign country. Both the export and import combined contribute
to the country’s trade balance. Whenever the country’s export is
more than the import, it is called a trade surplus. However, when
the import is more than the export, it is known as a trade deficit.
Objectives of Export Trade:

(1) Sale of Surplus Production:-

A country may produce more than it requires.
Then, in that case, the surplus may be sold to foreign countries.
(2) Optimum Utilization of Domestic Resources:-
Every country has some natural resources in plenty.
These resources can be utilized to increase the production and sell to
those countries where these are in shortage.
(3) Employment Opportunities:-
International business helps the business enterprises to focus on more
production which requires more manpower that means more employment
opportunities.
(4) Earning of Foreign Exchange:-
A country with surplus production may earn foreign exchange by selling
goods and services to other countries.
(5) Increase the National Income:-
Earning of foreign exchange due to exports add to the national income of
a country.
This help in improving the standard of living of people.
 The procedure of Export Trade

(1) Trade Enquiry and Sending Quotations •The international buyer who wishes to buy the goods
from the other country sends an inquiry relating to price,
desired quality, terms, and conditions for the export of
goods which is known as Trade inquiry.
•The exporter sends a reply to the inquiry in the form of
‘Quotation’.
•The quotation is also known as ‘Proforma
Invoice’ which contains information about the selling
price, quantity, quality, mode of delivery, etc.

(2) Receipt of Order or Indent •After the receipt of the ‘Quotation’, if the prospective
buyer finds the information suitable to him, he places the
‘Order/Indent’ for the import of goods.

(3) Assessing the Creditworthiness •Before proceeding further, the exporter wants to satisfy
him regarding the payment of goods.
•For this, he demands a Letter of Credit (L/C) from the
importer.
•This L/C is issued by importer’s bank in favour of the
exporter’s bank.
•Through the (L/C), the bank gives assurance to the
exporter of accepting the bill of exchange of a certain
amount.
•If required, the exporter can ask for advance payment
also from the importer
(4) Obtaining Export Licence & Apply •After satisfying himself about the payment, the exporter
Preshipment Finance and has to get an export license.
•For receiving the export license, he has to apply to the
office of the controller of imports and exports.
•Along with the application, he has to deposit a certain
fee also.
•The Controller of Imports and Exports checks the
application thoroughly and after having satisfied himself,
issues an export license to the exporter.
•The exporter can apply for a Pre Shipment Finance on
the basis of Confirmed Indent, Letter of Credit and Export
License.
(5) Procurement or Production of Goods •Exporting firm has to either procure ready-made goods
from the market or procure raw materials and start
producing the goods according to the specification of the
importer.
(6) Obtain Inspection Certificate and Excise •An exporter must approach a Govt. Authorized Agency
Clearance for Quality Check and Inspection of Goods meant for
Exports and obtains an Inspection Certificate.
•After Inspection, The exporter has to apply to the Excise
Commissioner to obtain the excise clearance from the
excise duty. The exporter needs to check if he is covered
under the duty drawback scheme.

(7) Obtaining Certificate of Origin •This certificate certifies about the origin of the
country in which the goods are produced and
exported.
(8) Packaging, Forwarding, and Insurance •The products are correctly prepared and labelled with necessary
details (Prepare PACKING List) such as:
• Title and address of the importer
• Net and Gross weight
• Port of destination and cargo
• Country of origin
• Road / Railway Receipt
• The exporter must ensure the Goods meant for
Exports and obtain a valid Insurance Policy (in case of
sea Transport – Marine Insurance Policy is required)

(9) Custom Clearance •The goods can be loaded on the ship after the customs
duty has been paid.

(10) Obtaining Mate’s Receipt •Then the products are boarded on the ship. The captain
or the mate of the ship delivers the mate’s receipt to the
port superintendent.
11) Payment of Freight and Issuance of Bill of Lading
( •After the freight receipt, the freight company delivers a bill of
lading.
•Bill of lading is a document which works as proof that the sailing
company has received the products for shipping to the assigned
destination.

(12) Preparation of Invoice •After shipping the goods, the exporter prepares a receipt of the
transmitted goods.
•The invoice is mentioned with the number of goods shipped and
the expense to be cleared by the importer.
Agricultural products for export:
Agri-Exports :-
India’s agri-exports can be divided into three broad categories, i.e. export of
a) raw products,
b) semi raw products
c) processed and ready-to-eat products.
Raw products exported are essentially of low value high volume nature, while
semi processed products are of intermediate value and limited volume and
processed ready-to-eat products are of high value but low volume nature. The
major agriexports of India are cereals (mostly rice - Basmati and non-Basmati),
spices, cashew, oilcake/meals,tobacco, tea,coffee and marine products. Value of
agri-exports to total exports of the country has been ranging between 15 to 20
per cent. Whereas marine products export has exhibited some uptrend, this
advantage was more than offset by sharp decline in export prices of soya meal
which of late has been a major export item.
•India’s agri-exports face certain constraints that arise from
conflicting domestic policies relating to production, storage,
distribution, food security, pricing concerns etc.
•Unwillingness to decide on basic minimum quantities for export
makes Indian supply sources unreliable. Higher domestic prices in
comparison to international prices of products of bulk exports like
sugar,wheat, rice etc.
•make our exports commercially less competitive.
•Market intelligence and creating awareness in international market
about quality of products need to be strengthened to boost
agricultural exports.
Marine products:
1. Registration of infrastructural facilities for seafood export trade.
2. Collection and dissemination of trade information.
3. Promotion of Indian marine products in overseas markets.
4. Implementation of schemes vital to the industry by extending
assistance for infrastructure development for better preservation
and modernized processing following quality regime.
5. Promotion of aquaculture for augmenting export production
through hatchery development, new farm development,
diversification of species and up gradation of technology
6. Promotion of deep-sea fishing projects through test fishing, joint
ventures and up gradation & installation of equipments to
increase the efficiency of fishing.
7. Market promotional activities and publicity.
8.To carry out inspection of marine products, its raw material,
fixing standards and specifications, training, regulating as well as to
take all necessary steps for maintaining the quality of seafood that
are marketed overseas.
9.Impart trainings to fishermen, fish processing workers,
aquaculture farmers and other stake holders in the respective
fields related to fisheries; promotion of modernization of fishing
harbours.
10.Conduct research and development for the aquaculture of
aquatic species having export potential through Rajiv Gandhi
Centre for Aquaculture (RGCA).
11.Conduct extension and awareness activities, trainings etc
through Network for Fish Quality Management and Sustainable
Fishing (NETFISH) & National Centre for Sustainable Aquaculture
(NaCSA).
12.To prescribe for itself any matters required for protecting and
augmenting the seafood exports from the country in the future.
Textile:-
Textile management is an interdisciplinary research subject where 
management issues in the textile and fashion industry (i.e. the value chain
 of textile products from concept to customer) are studied.[1]
[2]
 Textile management can be described as studies of practices related to
the textile and fashion industry, including studies of the organization and 
management of textile and fashion-related supply and demand chains,
including  design and product design, product development, production
 and manufacturing processes, procurement, distribution and logistics, 
marketing, market communication and merchandising, retailing, consumer
analyses, consumer behaviour, sustainability etc
.[3] The reverse flow is also addressed, the aim of which is to recreate lost
value, such as returns management, organization of recycling and reuse, etc.
[4]Researchers within Textile management have different
backgrounds and the diversity mirrors the wide range of
perspectives. Thus, Textile management is a multi- and 
interdisciplinary research area, i.e. a cluster of fields, which
borrows different theoretical lenses and uses them in an applied
setting. Researchers study different phenomenon, from 
entrepreneurship and innovation to integration of sustainability
 within the industry and local production of fashion.[5] The diversity
is also mirrored in used research methods and views of knowledge. 
Qualitative methods (e.g. to understand ethics and moral within
supply chains[6] and local, slow production[7]) as well as 
quantitative methods (e.g. to develop traceability systems[8]).
Engineering Goods:
The Engineering sector is the largest segment of the
overall Indian industrial sector. India has a strong engineering and
capital goods base.
• The engineering sector employs over 4 million skilled and semi-
skilled workers (direct and indirect).Engineering goods include
metal products, industrial machinery and equipment, auto and its
components, and transport equipment.
Export Performance:
India's engineering exports registered the highest ever growth of
about 85 per cent to USD 60.1 billion in 2010-11.During 2009-10,
the exports were USD 32.5 billion, according to EEPC data.• The US
accounts for 30 per cent of the country's total engineering exports.
India's total exports in 2010-11 stood at USD 245.9 billion, the
highest ever since Independence. Out of which engineering goods
exports accounts for $60.1 billion i.e. almost 40% of total India's
exports
Engineering Export Promotion Council (EEPC)

EEPC was set up in 1955 under the sponsorship of Ministry of

Commerce, Govt. of India, for export promotion of engineering
goods, projects and services from India.• Initially started with a
few hundreds of engineering units as an small outfit, with a
passage of time it has grown to be the largest Export Promotion
Council having membership of nearly 12,000 from amongst large
Corporate Houses, Star Trading Houses, SME, etc.⚫ Out of the
total membership of the Council, 60% constitutes the SMEs.
Engineering exports from India has been steadily growing and the
performance has probably exceeded all expectations ever since
the birth of the Council. Apart from being one of the largest
stakeholders in the total exports out of India, - the engineering
exporters are the foremost net foreign exchange earner in the
country.
Exporting Technology and Software:-
Technical Data (aka technology) is defined as information which
is required for the design, development, production,
manufacture, assembly, operation, repair, testing, maintenance
or modification of an item. This includes information in the form
of blueprints, drawings, photographs, plans, instructions or
documentation (as well as many other forms).
Providing controlled technology (or software source code) to a
foreign national in the United States or abroad is deemed to
be an export of that technology to the country of citizenship or
residence of said foreign national. For example, sharing design
information on night vision goggles with a foreign national is an
act which is subject to the same export restrictions and
requirements as physically shipping those night vision goggles to
the foreign national's home country.
An export occurs when there is a “release” of controlled technology (or software
source code) to a foreign national.  “Release” is defined as:
1..Visual or other inspection by foreign persons of an item that reveals technology or
software source code to a foreign person
2.Oral or written exchanges with foreign persons of technology or software source
code in the United States or abroad
A “release” to a foreign national that takes place within the U.S. is known as
a “Deemed Export”. As mentioned above, deemed exports are activities that are
regulated in the same way that physical exports of tangible goods are; restrictions and
requirements may apply.
Other ways to export data without actually sending the information abroad are:
• Sharing controlled data at a conference anywhere in the world with foreign
nationals present
• Allowing a foreign national to observe how controlled goods are developed
and/or produced
• Providing instruction to a foreign national on how a controlled good is “used”
(operation, installation, maintenance, and repair)
•E-mailing controlled data to a foreign national located in the United States or abroad
•Providing information to another person with the intention that the data or
technology will be shared abroad or with a foreign national whether in the United
States or not.
 
Exempt Technology
Note that the following types of technology are not subject to U.S. export controls and
may be shared freely with any party:
1. Technology that is already in the public domain
2. Technology that is taught in catalog courses at Duke
3. Technology that arises from Fundamental Research

-----------X-----------