Not every product is exportable. Generally, people buy a foreign product because their own country does not produce that product (for example, Americans buy coffee from abroad because the United States' climate does not favor the production of coffee); because the foreign version is less expensive (for example, Chinese cloths are very popular in the United States ), of better quality, more durable, or more dependable; or because of fashion or elitism (for example, in Europe it is fashionable to smoke American Marlboros or Winstons ). So the first step in determining an export strategy is to see whether a particular product being considered for export is used in other countries. If so, the following questions should be answered:
How much is used?
How has the foreign market behaved?
Who are the major exporters?
What is the United States' market share?
In order to answer these questions, a manager must find out who is exporting to whom and who is importing from whom. There are several sources for such information.
- Statistics on U.S. exports to the rest of the world are collected and published by the Department of Commerce. Data are fairly accurate and current.
- World import statistics are collected and published by the United Nations. Data are fairly accurate but are a year to a year and a half old by the time they are published. World imports and exports are listed both by country and by Standard Industrial Classification number.
- The Small Business Administration (SBA) has an export information system (called XIS), which provides data on imports and exports by more than 150 countries of all products included in the United Nations' Commodity Trade Data Base. In addition, the XIS provides data on the top twenty products imported by some sixty countries.
Using these data sources, an astute manager can develop an excellent market analysis for management scrutiny.
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