5 Risks in Exporting Manufactured Goods

5 Risks in Exporting Manufactured Goods

We ran into this great article about the 5 risks of exporting manufactured goods and how to avoid them. We decided to share it with all our readers as well and although we don’t export led light bars, we only import led light bars, it’s still relevant for all of us to consider.


The last few years have not been kind to US manufacturers, with their exports in a steady decline since dominating 57% of all American exports in 2008. However, the recent free trade agreements with South Korea, Colombia, and Panama have opened up new opportunities for industrial companies looking to grow their businesses in this tough economic climate.

According to the National Association of Manufacturers, the trade of manufactured goods with FTA partners already average $25 billion in surpluses; meanwhile, that with the rest of the world routinely logs in an average deficit of more than $400 billion. With President Obama’s ambitious National Export Initiative, the U.S. Commercial Service is focused on giving U.S. companies the necessary support to hopefully double exports by the end of 2014.

However, U.S. exporters must recognize the risks that may occur when attempting to seize the trade potential presented by the boom in foreign clients and customers. From leaving the port to cracking into a new market, the trade of manufactured goods faces both logistical and abstract challenges at every step along the way. The only way to properly assess and mitigate the possibility of encountering potholes in the road is through reliable information and services offered by reputable agents and trading companies located in your target market.

Below are 5 common challenges faced by companies who choose to export their products and their respective solutions.

1. In Transit

Say you’re an American company looking to export multi-tools to Sao Paulo, Brazil. Not only do you have to make sure that the shipment departs and arrives on time and at the right place, with handlers there to assume responsibility of the goods once on Brazilian soil, but you must also take into account the possibility of damage, loss, and theft. Solid logistical planning and the services of a respectable company are therefore imperative in ensuring that things start off smoothly.

2. Border Control

Customs clearance, unforeseen tariffs, a check of compliance with local rules and regulations – these are just some of the problems that may appear before the goods even enter the market. To help facilitate the movement of goods across the border quickly and safely, employ the services of trade compliance and customs law consultants. Sound judgment can help you avoid the nightmare of having your exports held up at customs.

3. Covering All the Bases

You’ve already drummed out a meticulous payment plan and now the shipment has arrived, with a customer to pick it up. Now in a foreign land, what happens when a disagreement concerning exchange and interest rate fluctuations emerges? What happens when, worst of all, a customer refuses to pay? A legal team savvy in local protocol is not just a recommendation but a necessity.

4. Navigating Unfamiliar Territory

Not only do you need a distributor who can get the products on the shelves, but you need one who can get them flying off as well. To have a successful export product, you will need to take into account the cultural nuances, local preferences, and current trends of the destination country. A good idea and general market research is not enough; marketing and distribution agents are essential in offering expert opinion on everything ranging from creating the packaging to finding the right center of distribution.

5. Staying in the Game

The product may have arrived at the point of destination but the game is not over yet. Problems such as charges of faulty equipment may arise once the goods begin to circulate in the region. Furthermore, intellectual property (IP) laws may be shaky or lacking. For example, while IP rights may be officially acknowledged in China, the legal framework remains fragile and copyright violations continue. To better protect your competitive edge in an overseas market, find regional experts and consultants.

In today’s tough business environment, one solution to shrinking margins and shrinking markets is to expand into exporting. As part of the Obama administration’s export push, the U.S. Commercial Service has teamed up with partners to offer manufacturers the tools to avoid risk. Websites like GlobalTrade.net can help U.S. exporters find import/export service providers located worldwide in their online directory. By partnering with reputable experts located in your target market, you can easily maximize opportunity and minimize risk in this trade dash.


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