In this stage a company is usually looking for general information about the export process. Here you can find answers to a series of questions, such as: export requirements, local institutions that support exports, what you must know about your products before exporting, company conditions to export, and options for internationalization. You will also be given the option of carrying out a test that will indicate whether or not you are ready to export.
Before starting the export process, it is advisable to ask the following questions:
- Generate an additional source of income for the company.
- Diversify risk and not depend solely on the domestic market.
- Increase the volume of production, to reduce the per unit costs of manufacturing.
- To grow and reduce eventual demand fluctuations resulting from a limited internal market.
- Increase the quality and competitiveness of products through the experience obtained when the company and its products are exposed to international competitiveness, which in turn has an impact on management skills.
- Increase the bargaining power for the purchase of inputs, by increasing the volume of production.
- Improve corporate image.
- Creation of new products or improvement of existing ones.
If you want to be a successful exporter it is necessary to know the weaknesses, strengths, opportunities and threats of the company / products. Likewise, it is very important to develop and maintain a good corporate image in the eyes of customers and suppliers. To be successful in the export process, you must know the following:
2.1 What does my product or service offer, in regards to the following?
- Characteristics / design
- Certified quality
- Presentation (packaging and packaging)
- Delivery service
- What competitive and comparative advantage(s) does my product have? Is it exportable?
2.2 Knowledge of my product / company
- Is my company in a position to export?
- Cash Flow: You must carry out an analysis of your company’s present and projected income and expenses including the marginal income of the export. It is also necessary to perform a financial analysis of the company, paying special attention to the working capital, because when exporting, accounts receivable turnover is slower than when selling only in the local market.
- Production Capacity: It is necessary to identify the minimum and maximum possible production quantities with the currently installed capacity and analyze if it will be necessary to increase production to meet the demand requirements of the international market. You must also consider the implications of making the required investments in capacity.
- Personnel: It is important to evaluate if your company has the qualified personnel required to effectively manage international relations. You must consider if you have the talent necessary to complete market research, manage logistics, identify potential clients, negotiate, function bilingually, and much more.
- Once you have analyzed your company, you must study your product:
- Identify Potential Markets: Before continuing with your export plans, it is necessary to identify which markets could be interested in your product. When researching potential markets, it is advisable to approach institutions that support imports in these countries and seek their support. FIDE also provides support for market identification, with information provided on this page in a series of documents called “How to Export to.” and for additional information it is suggested you contact us.
- Ensure Your Product Is Exportable: You must analyze if it will be necessary to make modifications to your product to comply with technical requirements and consumer tastes.
There are two ways to internationalize, one of them is through direct exporting, which as its name implies is to sell directly to customers through wholesalers / retailers, distributors / agents / representatives, or through participation in joint ventures, branches and franchises.
The other way to get products to enter international markets is through indirect exporting, which consists of selling your products to a local company, a foreign company based in Honduras, or local brokers and representatives who will be responsible for selling the products in international markets.
To make sound decisions, it is necessary to have accurate information, so we must conduct an investigation of the selected market to ensure we are informed about consumer tastes and trends, competition, pricing, existing distribution channels, technical specifications and standards, market demand, required product adaptations, and more.
We should also analyze the following aspects:
- Economic and Political Situation: GDP, inflation, purchasing power, openness to trade, political stability.
- Legal Environment: foreign investment laws, the laws that regulate contracts with importers and distributors.
- Logistics: routes and means of transport available for the markets to which you want to enter, coordination and control, costs of supply and supply services, road infrastructure, ports.
- Financial Situation (of your company): if the flow of earnings gives you the backing to take certain risks, consider the fluctuation of the exchange rate.
Once the product and market for export have been selected, several aspects must be coordinated with the importer or representative abroad to ensure that the product reaches the final consumer in a competitive manner and with a long-term projection. Some of the factors that influence the success of an export and must be considered are: product adaptation and quality, competitive pricing, adequate marketing strategy, economic capacity of the company, economic / political situation of the country, and proper publicity and promotion.
The International Commerce TERMS (INCOTERMS) are a set of internationally applicable rules designed to facilitate the interpretation of commercial terms commonly used in foreign trade.
The commercial terms are characterized by abbreviations or acronyms that indicate their content (for example FOB, CIF, etc.). Each of them contains a set of obligations to be assumed by the buyer and by the seller in the international sale.
Incoterms are also called “price clauses”, since each term determines the concepts that make up the price: obligations of the seller and obligations of the buyer.
“Container” means any material, in various forms, designed to contain merchandise and intended to individualize, administer, preserve, present and describe unitarily the merchandise it contains. Regarding “packaging”, it is understood as any material intended to protect merchandise for its dispatch (handling, loading and unloading, etc.) and / or its conservation in transport containers or warehouses.
The Royal Academy in its dictionary defines it as a “box or cover with which the objects that are to be transported to distant points are protected”.
The expression “export packaging” refers to when the merchandise is sent to a foreign country. When the packaging is designed for a particular means of transport, it is indicated, for example, “export packaging by air”.
By answering these general questions about how exporting will affect the short, medium and long-term goals of your company, it will help you determine if your company is ready to export:
- What is it that your company wants to obtain through its export?
- Is exporting an alternative consistent with the goals of your company?
- How much will exporting demand of the key resources in your company, such as administration, personnel, production capacity, and financing? How will your company handle these demands?
- Will it be worth the required investment? What are the expected benefits? Or will the company’s resources be more profitable developing the local market?
There are different permits and requirements depending on the market and the product to be exported; however, in general, a company must process the following:
- Commercial invoice.
- Export declaration. The form is provided by the Central Bank of Honduras (BCH), if the person is exporting for the first time and the amount is greater than US $ 3,000.00, you must complete an export form and attach a photocopy of the Individual Merchant Deed or the deed of incorporation, attach the original and a copy of the Commercial Invoice, and a photocopy of the National Tax Registry (RTN).
- Certificate of Origin available in the ANDI (if exporting to a country / region that has preferential access).
- If your product to be exported is food, it will be necessary to complete the following:
– Certificate of free sale and consumption, which is obtained in the Division of Food Control of the Ministry of Public Health.
– Sanitary / Phytosanitary Permits that are processed in the SAG.
– Sanitary license of the company.
- FIDE Investment and Exports
- The bilateral chambers of commerce
- Ministry of Industry and Commerce, through the Directorate of Commercial Promotion and CENTREX
- Embassies and consulates of the country abroad
- FIA Honduran Agricultural Investment Foundation
- FPX Federation of Honduran agro-exporters
- Chambers of commerce and industry of the country
- ANEXHON National Association of Exporters of Honduras
- COHEP Honduran Corporation of Private Companies
- ANDI National Association of Industrialists
- Embassies and foreign consulates in the country.
Test para el exportador
- Una empresa necesita contar con un panorama claro del grado de facilidad con el que puede lograr el acceso a mercados extranjeros.
- Evaluar el conjunto de factores básicos que intervienen en el proceso de exportación, permite al empresario tener una mejor visión de hacia dónde debe dirigir sus esfuerzos.
- FIDE, Inversión y Exportaciones, a través del Test para el Exportador genera un útil diagnostico que lo orientará en su proyecto de exportación.