Getting into the export trade

CEBU, Philippines - Export readiness entails a lot of steps to bring commodities to other markets but it can also become a worthwhile growth strategy for homegrown companies.

Exporting is definitely challenging for entrepreneurs and that they should see it as a potential to make substantial wealth for their businesses, advised Federico T. Escalona, PhilExport executive director during the forum on Basics in Successful Exporting.

Plan to export

Before getting into the export business, Escalona noted that doing market research and preparing an enterprise plan must be taken into consideration; and of course, most importantly, would-be importers should create and legitimize the business.

Making plans in various aspects--financial, management, production and marketing--can help the company establish a clear prospect for the industry.

After the completion of the plans, the director said that potential foreign buyers should be identified and negotiate with them for an export contract.

The talk between the buyer and the exporter will eventually lead to processing of export documents and transporting of goods.

He further advised exporters to improve their products that would surely “hit” the target market.

Aside from products and services, reverse exports that include medical tourism, BPO services, other tourism services such as beauty and wellness, resorts, software, etc. can also be exported.

The PhilExport executive explained that reverse exports are those that are already in the country but are engaged in foreign exchange.

Exporting is not an easy business, Escalona claimed, adding that a lot of businesses have been suspended mainly because of market condition.

Register

To be able to export, Escalona said that business owners need to have the Client Profile Registration System which help the process of capturing buyer information during the approval of various stakeholders of the Bureau of Customs.

The registration is done through the Electronic-to-Mobile or e2m Customs System, according to Customs Memorandum Order 39 of 2008.

CPRS Accreditation Committees include the Investments Board, Philippine Economic Zone Authority and other investment promotions agencies; while other exporters can also register with the Philippine Exporters Confederation, Inc.

Potential exporters must first consider that they should have the necessary government licenses, knowledge of the market, capable and semi-skilled labor force, strategic export pricing, market development, quality management, among others.

Export value

On the other hand, the Philippine export value last year was $53.976 dollars with a growth rate of 3.60 percent.

Escalona also noted that in order to improve the export sector, stronger policy reforms and programs to support exports have been put in place; to implement them effectively; strategies to lessen the negative impacts of the forces of the global economy; stakeholders’ support must continue.

The inter-agency Development Budget Coordination Committee is targeting the country’s value for export goods to reach $57.2 dollars this year with growth of 6percent; $61.8 dollars and growth rate of 8percent next year; and $68 dollars and 10percent growth in 2016.

While for export services, DBCC is setting the value at $24.8 dollars and growth of 15percent for this year; $28.8 dollars and 16percent growth rate for 2015; and $33.4 dollars is expected in 2016 with growth to steady at 16percent.

The Export Development Council has already created the Philippine Export Development Plan for 2014-2016 which has targeted the nation’s exports to reach $120 billion by 2016.

Presently, electronics remain to be the country’s top export products followed by woodcraft and furniture, mineral products and transport equipment.

As of April 2014, the biggest export trading partner of the Philippines is Japan which has 20.70percent of the total exports; the United States is second having 16.20percent of exports; and China is third with 12.60 percent.