by J. Stephen Pope
If you operate a small business, you may feel that your income potential is quite limited. However, you can increase and diversify your income through international trade.
1. Importing
Retail store owners can find additional products to sell from foreign manufacturers, distributors, and other suppliers.
Advantages of importing include increased product selection, lower costs, and increased income.
You may even decide to go exclusively into the import business and become a wholesale distributor.
2. Exporting
Manufacturers can find new customers for their products in foreign countries.
Perhaps consumers in your country have lost interest in your product. It may have become obsolete because of technological advances. A foreign market, however, may be desirous of that very product.
Maybe there is an economic slump in your country. Another country may be experiencing a boom. Sales from customers in that country may help stabilize your income.
Exporting can also help smooth the peaks and valleys of your income. For instance, if you sold winter sporting goods, you could sell to both northern and southern hemispheres to help offset the seasonal nature of your business.
Of course, you might also consider selling sporting goods for all the seasons and still export to other countries to increase and diversify your income.
You could also become an Export Management Agent. Arrange for other domestic companies to sell their products to foreign corporations and earn a ten percent commission.
You would think that selling to foreign customers would be quite risky. However, use of letters of credit can protect all parties. An Export Management Agent might actually arrange for ninety percent of the sale to be paid directly to the domestic supplier and ten percent to be paid directly to himself.
3. Licensing
Consider becoming a licensing agent. Earn royalties by arranging for foreign corporations to manufacture and sell the products of domestic companies.
4. Finder’s Fees
Imagine the possibilities for earning finder’s fees in international trade!
You can earn fees from domestic companies for finding foreign buyers (or for finding suitable imports from foreign suppliers). You can also earn fees from foreign companies for finding domestic corporations that will buy their products (or for finding suitable suppliers and products from domestic corporations).
5. Drop Shipping
Visualize receiving an order from a customer based in a foreign country and not having to be bothered with shipping and handling the product. No customs declarations or brokers are required by you. This is because your drop ship supplier is handling those details.
You might collect $100.00 plus shipping of $15.00 from your foreign customer. You then simply send your customer’s order to your drop ship supplier with your payment of $65.00 (consisting of $50.00 wholesale cost plus $15.00 shipping). Your drop shipper will now fulfill the order. Congratulations! You just made fifty dollars.
6. Mail Order
Add a mail order service to your existing business operation. Manufacturers, retail stores, and other businesses can increase their sales by using this additional method of selling that is very conducive to international trade.
7. Internet Marketing
You can also extend your reach to worldwide customers by means of the Internet. Methods of obtaining foreign business include affiliate marketing, online auctions, online stores, and websites.
Yes, to increase and diversify your income, consider international trade.