Creating A Healthy Serving of Imports and Exports

President Trump has plans to bring American jobs back to the United States. In doing so he has recently started the process of renegotiating the terms of the North American Free Trade Agreement or (NAFTA) and the Trans Pacific Partnership or (TPP). It allowed for one of the world's largest free trade zones and created a foundation for economic growth through the elimination of tariff and non-tariff barriers of entry. NAFTA governs a set of rules for trade and investment among Canada, the United States, and Mexico.

The TPP is the largest regional trade agreement in history, it consists of 12 nations along the pacific rim including the United States. This trade deal is seen unfair because we are simply at a trade deficit with Mexico. We are importing more of our goods than we are exporting to Mexico. With cheap labor in Mexico, along with the convenient location, it's hard for big companies in the U.S. to not exploit their advantage of cheap labor.

Along with lower taxation, there is an ultimate goal to reduce regulation and strain on major corporations and companies. Less regulation would allow domestic companies more room to capitalize and have growth. Companies can avoid taxes and enjoy dramatically lower wage costs due to less regulation in undeveloped countries. In turn this leads to the U.S. importing a lot more than it exports from the lack of manufacturing in-house. If the U.S. does in fact decide to drop trade agreements and raise tariffs there could certainly be repercussions. Right off the bat we can assume that the cost of buying the imported goods into the U.S. will increase due to a newly implemented tariff. So now in this scenario, we have higher prices on goods coming in or (imports), along with higher prices of goods going out or (exports). Mexico being the top export country of U.S. grown beef, soybean meal, corn sweeteners, apples, and beans. This butterfly effect could really hurt a lot of domestic farmers and other large companies that are major players in the exporting business.

Types of Import/Export Businesses

Export management company (EMC): An EMC handles export operations for a domestic company that wants to sell its product overseas but doesn't know how (and perhaps doesn't want to know how). The EMC does it all -- hiring dealers, invoicing customers, distributors and representatives; handling advertising, marketing and promotions; overseeing marking and packaging; arranging shipping; and sometimes arranging financing or contracting out for a developing a credit card app. In some cases, the EMC even takes title to the goods, in essence becoming its own distributor. EMCs usually specialize by product, foreign market or both, and--unless they've taken title--are paid by commission, salary or retainer plus commission.

Export trading company (ETC): While an EMC has merchandise to sell and is using its energies to seek out buyers, an ETC attacks the other side of the trading coin. Import/export merchant: This international entrepreneur is a sort of free agent. Swimming the Trade Channel

A manufacturer who uses a middleman who resells to the consumer is paddling around in a three-level channel of distribution. Manufacturer's representative: a salesperson who specializes in a type of product or line of complementary products; for example, home electronics: televisions, radios, CD players and sound systems. Distributor or wholesale distributor: a company that buys the product you've imported and sells it to a retailer or other agent for further distribution until it gets to the end user

Representative: a savvy salesperson who pitches your product to wholesale or retail buyers, then passes the sale on to you; differs from a manufacturer's representative in that he doesn't necessarily specialize in a particular product or group of products

(Think Dell Computer purchasing a software program to pass along to its personal computer buyer as part of the goodie package.)

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— Selasa, 25 April 2017 — Add Comment