Indirect exporting of Goods and Services
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Indirect exporting is the movement of goods and services across borders by the use of home country-based exporters. This technique is easier since the producer does not commit much expertise and capital. Another company instead sell for the producer, or buy for a foreign client, conduct their transaction or on behalf of other foreign agents. A company is able to perform either of such roles or of a combination in the event of the undertaking business. The producing company with a department or a person given the responsibility of developing the exports, however, handles direct exporting. Direct export may require the establishment of a section to market the products of a company where the sales are conducted to expand business.
The main types of indirect exporters are the manufacturer-exporting agents, export management, international trading companies, export commission agents, merchants, cooperative exporters, large foreign users and export resident buyers. Export agents, export management, and international trading companies act on behalf of a manufacturer. Export agents are international representative for non-competing firms and are paid commission for carrying their functions on behalf of producers. The export management, on the other hand, acts as the export department for several non-competing agencies and transact business on their behalf using their names. They work on commission with the manufacturer directly invoicing the foreign client or on a buy-resell basis. The trading companies import and export on their individual capacity and financing.
Shipping commission agents buy for their customers overseas and are paid on commission by purchasers (Ball, Geringer, Minor, McCulloch, & McNett, 2013). Their other type is the buy and resells for own purpose like merchants, associations, and piggyback exporters. They purchase from foreign manufacturers and resell along with their goods, conduct business on their own and not as agents. Large external users and export resident buyers buy for their use and their foreign affiliates maintaining offices in the manufacturing countries.