Page 96 - International Marketing

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98 International Marketing BRILLIANT'S

In an export transaction, a number of trade intermediaries and
government authorities are inevitably involved, such as the Directorate
General of Foreign Trade, Export Promotion Councils, Export Inspection
Agencies, Banks, Central Excise and Customs Authorities, etc., which
have their own documentary requirements. Strict compliance with procedural
formalities and documentary requirements requires meticulous planning
and desired skills for the successful completion of an export order.
Incorrect documents may lead to non delivery of goods to the importer.
You may get the correct documents after some time but in the meantime
storage charges may have to be paid. The importer will think twice before
importing from the same exporter in case of any mistake made by the
exporter. So, every exporter should have an adequate knowledge about
export documents and procedures.
Consequences of Poorly Completed Documentation
Poor documentation may result in a number of problems in executing
an export order, which may lead to additional costs to the exporter. These
costs may be of three types:
(a) The cost of interest charges incurred by the exporters as a re-
sult of delays in receiving payment.
(b) The cost of putting the problem right, such as telephone bills,
courier charges for sending replacement documents, bank
charges for amending documents such as letter of credit and
possibly loss of credit insurance cover.
(c) Perhaps the most serious, but also the most difficult to quantify,
is the cost to the relationship between the exporter and the cus-
tomer. More often than not, a new customer will be so upset by
poor documentation and the problem it causes that he will be
reluctant to do further business with such an exporter.
Classification of Export Documents

(A) Classification on the basis of function
On the basis of the functions to be performed, export document can
be classified under four categories:
1. Commercial Documents: Commercial documents are those
documents which, as per the trade customs are required to be prepared
and used by the exporters and importers in discharge of their respective
legal and other incidental responsibilities under the sales contract. These
are required for effecting physical transfer of goods and their title from the
exporter to the importer as well as for realizing the exports sales proceeds.
These include commercial invoices, bills of exchange, bills of lading, letter
of credit, marine insurance policy and certificates, etc.