Are you on the cusp of making the export leap? Here are some good ways to know and reasons to embrace exporting.
1. You can generate greater revenue for less effort.
Sure it takes a long time to seal a deal internationally, but once you do, the revenues are typically far greater than on a domestic deal. For example, let’s say you market gluten-free energy bars. When you ship an order locally to an independent health food store retailer, it might be between four to six cases. If you ship the same product to Austria, for instance, it might be 500 cases. The reason for the difference in the order size is because international customers want to make it worth their while on the shipping cost. The more they order, the lower their per unit shipping cost. Do the math: 500 cases of energy bars, for example, at $60/12-pack case equals a total cost of $30,000. Shipping and everything else included (insurance, tariffs, payment fee, if any) is $2,500, which is $5/case or 8 percent of the transaction cost. If that same customer orders a smaller quantity, the shipping price will rise commensurately against the total order cost.
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