Product Planning in International Markets
INTERNATIONAL PRODUCT PLANNING
A proper plan should be framed in respect of products to be exported. New products should be produced on a larger-scale to answer foreign demand. Supply of export goods must be uninterrupted. Goods having large domestic demand should be exported only if their supply is in excess of internal demand. Quality of export goods should be high and their prices competitive.
In exports, ‘product planning’ is a term which is used to describe the complete process of bringing a new product or service to a new market. There two parallel paths involved in the export product planning process – one involves the idea generation, product design, and detailed engineering and the other involves market research and marketing analysis.
Companies typically see new product development as the first stage in generating and commercializing new products within the overall strategic process of product life cycle management, used to maintain or grow the market share.
Export product planning involves determining which products to introduce into which countries; what modifications to make in the products; what new products to add; what brand names to use; what package designs to use: what guarantees and warranties to give, what after-sales services to offer, and finally, when to enter the market. All these are crucial decisions requiring a variety of informational inputs.
Although the basic functions of exporting and domestic selling are the same, international markets differ widely because of great variations in certain uncontrollable environmental forces. These include currency exchange controls/risks, taxation, tariffs, and inflation, which happen to originate outside the business enterprise. Such variations require managers who are aware of international threats and opportunities.
If a company already manufactures a product or service, it is reasonable to assume that its product or service is what will be exported. However, companies must first determine the export potential of a product or service before they invest their resources into the business of foreign trade.