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group III-developing products

international marketing
by

edelyn rambunay

on 8 September 2012

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Transcript of group III-developing products

the Foreign Market Developing Products for The product has three type which is the Augmented, actual and core product. what is a product? Product is the physical object(hardware, food, medicine), software or service from which customer gets direct utility plus a number of other factors, services and perceptions that make the product useful. - Difference in physical conditions
- Difference in the purpose the product is intended for
- Difference in local tastes
- Difference in social values
- Difference in the capacity to pay of the said market A product successful in one market may have to be adapted to sell well in another market for the following reasons:
The product reflects the company's image.
It should enhance the company's reputation as well. Product and Company Image - Deal only with reputable sales agents or importers/wholesalers.
- Give importers your best possible service to ensure that they will sell your products with enthusiasm.
- Supply helpful, well-written sales literature. Sometimes, the cost can be defrayed by your foreign associates. Useful steps that can be undertaken: products may be compared to humans. The product's life cycle Birth Growth Maturity decline Life cycle of a product in the garments industry as detailed in seven stages: Product Line Alternatives Common assumptions or misconceptions of manufacturers:
- Product development is a sure solution to business problems
- It is identical to developing new designs
- It is the sole responsibility of the designer
- It is purely a creative activity The Need for Product
Development Product Development
as a Business Tool develop current
products for
existing markets; develop new
products for
existing markets;
and develop new
products for
new markets Product development cannot be done by a single person, but by a team with a hodgepodge of ideas in order to reach the best possible innovative concept. Product Development as
a Group Effort Product development undergoes a process. It requires close coordination of individual activities that will translate into a successful end product. Product Development as a Process If you are considering what product to export, below are ways to help you:

- Find out what you are really interested in
- Scout for products that are readily available. Identify them all and you will be surprised at the number of products that you can choose from.
- Once the product is available, you still have to make tha modifications and adoptation to make sure that your product suits the market. Product Development in the - An agency under the Department of Trade and Industry
- aims to promote product development as a tool for improving the quality and competitiveness of Philippine products. The Product Development and Design Center of the Philippines (PDDCP) PDDCP's Services: Design of a new product, product adaptation, diversification or expansion of products or product line based on market needs and available technology. Product Design New design or redesign packages of food and non-food products based on requirements of the target market.
Package Design Hands-on learning and application of skills, such as finishing techniques related to product development. Product Technology Demonstration - Seminars on product development and trends, and information on generic product and package design details and processes related to product development.
Design and Technical Information EXPORT PACKING, MARKING AND LABELING -refers to proper way of protecting goods for a secured and safe travel going to the country of destination. EXPORT PACKING 1.Nature of the product
2.Mode of transportation
3.Climatic conditions during journey
4.Pilferage Susceptibility
5.Customer’s requirements
6.Cost of packing materials as against to total export cost Things to consider in packing
according to PTTC 1.Fireboard box or carton Types of Export Packing 2.Wooden packing crates 3.Wooden crates 4.Wirebound boxes Marking allows you to identify practically everything. Export Marking Sling here
Marking Symbols Keep away from heat This way up Use no hooks FRAGILE Center
of gravity Labeling- is the most obvious information on the product. EXPORT LABELING 1. Labels should make clear the quantity and quality of the goods. The information may include the ff:
Name and address of exporter
Weight and volume of contents
Ingredients (for foodstuff, beverages, liquor, etc.)
Material content
Specific instructions
2. Information must be given in the language and measurement system of the importing country.
3. The importing countries’ own regulations concerning the marking and labeling, especially of dangerous substances such as explosives, must be checked and observed. Rules in export labeling: Distribution EXPORT AND DISTRIBUTION CHANNELS •Involves all the activities concerned with the transfer of goods from the manufacturers to the consumers.
• The aim of distribution is to ensure the availability of products to people who want these
items whenever and wherever they want to acquire them.
•It involves both commercial and physical activities. deals with trade contracts and the choice of wholesale
and retail channels that involve finding
good markets and demand stimulation. Commercial Distribution deals with the problem of space and time, specifically how to effect the transport and storage of goods.
It basically answers the question “How orders should be handled?” Physical Distribution CHANNELS OF DISTRIBUTION As the diagram illustrates, any export producer or trader can reach the buyer through either of these two ways:

1. Direct Export Sales which means developing a firm’s own sales force, and offering products directly to the retailers without resorting to intermediaries.
2. Indirect Export Sales Through Intermediaries which means relying on importers and commission agents both here and abroad who, in turn, distribute or serve major buyers directly. COMMON DISTRIBUTION
FUNCTIONS •Manufactures the goods
•Sells and promotes the goods
•Packs the goods
•Weighs and inspects the goods
•Arranges for the transportation
•Delivers to agreed destination
•Receives payment for the goods PRODUCER-EXPORTER •Does not keep stock
•Is not responsible for the payment
•Works on the basis of a sole agency
•Puts the buyer and seller together
•Receives commission AGENT •Buys at his/her own risk
•Keeps stock
•Will not disclose the names of his/her clients
•Might handle other competing products
•Might be willing to pay some promotional expenses
•Sets his/her own profit margin
•May work on he basis of exclusivity
•Gives credit
•Delivers goods to the retailers IMPORTER/WHOLESALER Buys from wholesalers or purchases from associations
Buys from agents-importers
May import directly through his/her own purchasing department
Keep stock
May insist on exclusive contracts
Promotes the items
Stores and displays
Can be powerful marketer if the product interests him/her
Sells to end-consumers RETAILER May work regionally
Does not cover the whole country
Often specializes in food and household products for specific industries like hotels, restaurants, etc.
Does not insist always on an exclusive contract SPECIAL WHOLESALER Ultimately buys and processes the goods
May store the goods
Consumes the goods
Pays in cash or credit
Includes industries, hotels, airlines, etc.
CONSUMER Kinds OF Stores Large numbers of styles but low volume
Moderate to reasonable prices
Do not provide specific design direction, but rely on manufacturers for actual design Department Stores Few styles / high volume
Low price
Provide design of a successful product to be copied
Shorter lead time compared to that given by department stores Discount Stores Few styles / low volume
High price per style
Provide design
Shorter lead time Specialty stores Many styles / low volume
Moderate to high prices
Frequent reorders
Develop their own design
Designs run for about two years
Average lead time Mail-order companies few styles / high volume
Low to moderate prices
Provide design of a successful product to be copied
Short lead time Wholesaler/Distributors a. type and nature of the product
b. market segment you are aiming at
c. available quantities
d. delivery and payment terms FACTORS TO CHOOSE A DISTRIBUTION CHANNEL Choices in transporting the goods: SHIPPING THE GOODS a. by sea
b. by rail
c. by air

•Ocean freight is the most widely-used from of shipment in the international trade.

•Being the cheapest mode of transport 4 types of ocean service: ORGANIZATION OF THE OCEAN TRANSPORT Belong to a line which is a member of a shipping conference
Conference are group of shipping lines bound together for the purpose of adopting common rules and regulations.
The commonly-used type of shipping 1. Conference line vessels Operated by shipping companies that offer scheduled services but quote freight rates independently from one another. 2. Non-conference vessels Do not follow any regular routes but travel where cargoes are available. 3. Tramp ships Can be hired into transport products for a particular purpose of time. 4. Charter ships Freight rates

= Weight (expressed in tons or 1,000 kilos) or
= Volume (expressed in cubic meters) OCEAN FREIGHT RATES a. basic rates per cubic meter or meter ton
b. surcharges such as currency adjustment factor, bunker adjustment factor, container, service charge, part congestion surcharge, war risks, arbitrary charge, etc.
Freight cost consists of two main components Freight container (ISO defines)
An article of transport equipment which is single, rigid non-disposable cargo box, ventilated, insulated, reefer, flat rack or open top with or without bogies and attached not less than twenty (20) feet in length, and having a closure or permanently hinged door that allows ready access to the cargo. Containers have partitions, fittings and fastening able to withstand without permanent distortion all the stresses that may be applied in normal service of continuous transportation. CONTAINERIZATION 1. Full Container Load (FCL)
The shipper will have a container at his/her disposal and that he/she will normally have enough cargo with which to fill the container

2. Less Container Load (LCL)
The goods are delivered to the carrier for containerization.

Container SizeCapacity
. 20 ft.33 cbm
. 40 ft.67 cbm
. 40 ft. high cube76 cbm
. 40 ft. jumbo76 cbm
. 45 ft.86 cbm Two types of container shipment Formula to compute for loadability: Is a good choice for goods which are highly perishable and valuable
Goods with high ratio to weight

Examples: flowers, fruits, marine products, jewelry pieces AIR TRANSPORT a. Speedy delivery of goods
b. less risk of pilferage and damage
c. Less need for costly protective packaging Advantages of air transport Air transportation freight rates

•Based in actual weight in kilograms or volumetric weight (dimensions) in kilograms Formula: BY: E.S.R References:
International Marketing by Luz T. Suplico et.al
WWW.SLIDESHARE.NET/MCURPHEY/PRODUCT-DEFINITION
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