What are the Benefits of Importing and Exporting Products?
With the expansion of the Internet, many businesses have now started to compete on a global scale. Whenever a business starts growing and expanding, entrepreneurs begin striving to become more competitive – either by importing or exporting goods. As these are the basics that make a business successful, here are some of the key benefits of importing and exporting that are worth considering.
Why is importing and exporting goods important?
As soon as a business starts operating internationally, there are many additional factors which can have a huge impact on its success. Exporting and importing goods is not just the core of any large, successful business; it also helps national economies grow and expand.
Each country is endowed with some specific resources. At the same time, a country may lack other resources in order to develop and improve its overall economy. For example, while some countries are rich in minerals and precious metals or fossil fuels, others are experiencing a shortage of these resources. Some countries have highly developed educational systems or infrastructures, while others do not.
Once countries start exporting whatever they are rich in, as well as importing goods they lack, their economies begin developing. Importing and exporting goods is not only important for businesses; it is important for individual consumers, too. Consumers can benefit from certain products or components that are not produced locally, but are available to purchase online from a business abroad.
Benefits of importing
When people talk about importing in terms of trade, they refer to purchasing products or services from another country. These products or services are then offered to customers by the importing business or individual, broadening their choice of purchase. However, this is not the only benefit of importing; there are many more to consider. Here are some of them.
1. Introducing new products to the market
Many businesses in India and China tend to produce goods for the European and American market. This is mostly due to the size of these markets and the purchasing power of the population there. But once a new product is introduced to these two markets, it may take a year or more before the product is introduced to other, smaller markets.
If a product produced in China seems attractive/useful to entrepreneurs in Australia, they can import it and introduce it to their potential consumers. Thanks to the internet expansion, entrepreneurs can conduct market research prior to importing a certain product. This will help them determine if there is an actual need on the market for such an imported product, so they can develop an effective marketing strategy in advance.
2. Reducing costs
Another major benefit of importing is the reduce in manufacturing costs. Many businesses today find importing products, parts of products and resources more affordable than producing them locally.
There are numerous cases when entrepreneurs find products of good quality which are inexpensive even when the overall import expenses are included. So instead of investing in modern, expensive machinery, entrepreneurs choose to import goods and reduce their costs. In most cases, they end up ordering large quantities in order to get a better price and minimize the costs.
3. Becoming a leader in the industry
One of the key benefits of importing products is the opportunity to become a market leader in the industry of interest. Since manufacturing new and improved products is a never-ending process, many businesses worldwide use the chance to import new and unique products before their competitors do. Being the first to import a fresh product can easily lead you to becoming a leader in a certain industry.
4. Providing high quality products
Another benefit of importing is related to the ability to market products of high quality. Lots of successful entrepreneurs travel abroad, visit factories and other highly professional sellers in order to find high quality products and import them into their own country. Moreover, manufacturers may provide informative courses and training, as well as introduce standards and practices to ensure the company abroad is well prepared to sell their products.
If you choose to base your business on importing products, chances are you are going to get high quality products. This is due to the fact that manufacturing businesses are very aware that their reputation largely depends on the quality of the items they produce. This is a reason more to consider importing the essence of your new business.
Benefits of exporting
Just as there is a variety of benefits of importing products and services, there are numerous reasons for exporting, too. Here are the two key benefits of exporting products to other countries:
1. Increasing your sales potential
While importing products can help businesses reduce costs, exporting products can ensure increasing sales and sales potential in general. Businesses that focus on exporting expand their vision and markets regionally, internationally or even globally. Instead of earning money by selling their offerings on the local market, these businesses are focused on discovering new opportunities to present their work abroad.
Exporting products is especially good for medium and large businesses – the ones that have already expanded within the local market. Once they have saturated the market in their country, exporting products abroad can be a great opportunity for these businesses to increase the sales potential. Additionally, exporting can be one way of scanning opportunities for overseas franchising or even production.
2. Increasing profits
Exporting products can largely contribute to increasing your profits. This is mainly due to the foreign orders, as they are usually larger than those placed by the local buyers. While local customers buy a few products or a pallet, businesses abroad oftentimes order a container of products which inevitably leads to increased profits. Moreover, if your products are considered unique or innovative abroad, your profits can increase rapidly in no time.
Achieve your business goals by importing and exporting products
Importing and exporting products can be highly beneficial for businesses today. While importing can help small and medium businesses develop and expand by reaching larger markets abroad, exporting can increase the profits of medium and large businesses.
If you’re striving to make your business the leader in its industry, or you are thinking of lowering production costs, importing is certainly worth considering. Otherwise, if your local market is too small for your business and you’re searching for new opportunities to expand – exporting may be your key to success.