Export Finance and the Pursuit of International Growth

exportIn its simplest sense, to export means to send goods for sale or exchange to other countries or territories. Businesses as a whole have continually strived for growth not only domestically but also internationally. It is also for the same reasons why methods like export finance have skyrocketed into popularity and efficacy for the past years.

But what is it that brings entrepreneurs to continually dream of global success? The answer is obvious but for the sake of discussion, we’re breaking them into 7 reasons as follows.

#1: MARKET – Domestic markets are no doubt smaller in comparison. Going beyond borders, this means getting the opportunity to offer one’s brand and products to a larger audience. A company’s audience in a specific place is very limiting, exporting maximizes that number.

#2: SALES – With a bigger market and more customers, the business is to experience an increase in sales. Think about it. If a phone company releases a new model in a certain country and let’s says for the sake of discussion that everyone buys it, the trade stops as the last person without one makes their purchase. There’s a limit. By exporting, one gets to venture and tap other foreign markets.

#3: PROFIT – As sales rise up, the expenses or costs are eventually ruled out to reveal an increase in profits over time. This is the primary reason why entrepreneurs want to export. It’s income.

#4: GROWTH – With the numbers on the rise, growth is imminent. What business owner wouldn’t want that? This is true regardless of industry. Think about it. From a home-grown to a global brand, what a dream!

#5: COSTS – Equipment and resources are maximized when one chooses to export. Machineries get to produce at their full potential thus generating more output. Why is this good? Assets depreciate over time regardless of how much is being produced. Moreover, the more output generated in production, the lower the per unit cost becomes.

#6: LOSSES – Exporting helps reduce seasonal losses which a lot of companies tend to suffer. For instance, a clothing company’s summer line may already be passé in a certain market but it still to be introduced at a foreign one. Moreover, this helps lengthen the life cycle of one’s products.

#7: RISKS – With export finance and international trade, risks are better diversified. This is because markets behave differently and what may be a loss in one may not constitute the other.

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