International Trade 2 Assignment Sample

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Introduction

International trade refers to a process of exchange of goods and services across the national boundaries of the country. The present study will be based on Julian`s company which engages in selling fruits and vegetables in Andalusia. The company strives to expand its business in the international European market to offer eco-friendly fruits and vegetables. Students seeking to enhance their understanding of international trade concepts can rely on cheap assignment help to better analyze strengths, weaknesses, export documentation, and risks. The report will outline the strengths and weaknesses of the company and the competitive advantage that helps it become successful. Furthermore, it will explain agencies that provide different countries' information, require documents, incoterms recommendation, risk in export and available aids from the Government.

International Trade 2 Assignment Sample

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Self-assessment of Julian`s company and competitive advantage

Julian`s company is required to identify its strengths and weaknesses to be successfully aware of its competitive advantages and effectiveness to expand the business internationally. SWOT analysis helps the business to identify strengths and weaknesses in the best manner. Following are the strengths and weaknesses of Julian`s company:

Strengths:

• Eco-friendly product range: One of the strengths of Julian`s company is its eco-friendly product range. In modern times customers become health-conscious as a result demand for organic fruits and vegetables has increased (Zhang et al, 2024). The strength of the company helps in catering products according to the needs and requirements of customers.
• Low operating cost: Another strength of the company is its low operating cost as the company produce eco-friendly fruits and vegetables in large amounts, resulting in a decline in the cost of operation, and hence aids in attaining a higher profit level.

Weaknesses

• Limited international experience: One of the weaknesses of Julian`s company is its lack of experience in working in the international market. This limitation makes it onerous for the organization to mark its presence in the competitive market of France.
• Lack of online presence: Another weakness of Julian Company is the lack of online presence in the digitalization era. This weakness limits the company's ability to increase customer base, market share and profitability.

The company has two competitive advantages that guarantee its success in the international market sustainable eco-friendly fruits and vegetables products as well as its low cost of operation. The company by its eco-friendly offerings can distinguish its product in the French market as a result help in providing a competitive edge, In addition, the low cost of operation enables Julian to offer products at affordable prices, leading to help in gaining customer attention in a competitive environment.

Agencies to obtain information about countries' condition

At the global level, several agencies provide valuable and reliable information about the different countries' conditions, policies and aids in terms of international business. These agencies are as follows:

World Bank: One agency that provides information about the country`s condition, policies and aid is the World Bank. It furnishes data on economic indicators as well as business regulations in different countries. According to the provided information the business decides against expanding business activities in international markets (Cormier and Manger, 2022). The Julian Company can obtain information from the World Bank regarding the gross domestic product, consumption, investment and so more, which helps the business identify the prospects of success of business.

World Trade Organization: Another organization from where the Julian Company gained required information on trade policies and available aids for international business is WTO. The organization provides rules and regulations at the global level for trade between different nations. World Trade Organization publish annual reports about the different countries' conditions, and policies as a result by evaluating the published data company can effectively obtain the information that helps it select the appropriate country for international trade.

European Commission’s Trade Helpdesk: The agency or a platform provides information regarding the tariffs, customs procedures, formalities, requirements of products in the EU market consisting of special conditions and so more. From this platform, the Julian Company can be aware of the policies and document requirements for efficiently conducting international trade. It is one of the best sources or agencies to obtain crucial information regarding international trade.

Documentation is required for export.

For export purposes, there is a requirement for the completion of several documents. It is as follows:

Commercial invoice: It is a legal document between the exporter and buyer that demonstrates the goods being sold and the amount the customer is required to pay. The document is used to determine the custom duty of the product.

Packing list: This is a more detailed and informative document that consists of information about the seller, buyer, invoice number, date of shipment, carrier, mode of transport quantity, type of package and so more.

Bill of lading: It is a contract between the owner of goods as well as a carrier. It acts as a legal document that allows the individual to hold the claim of the ownership of the cargo. It leads to details of the carrier's responsibilities with the parties involved in the transportation of the cargo.

Export license: It is one of the main documents for export, an export license is considered as a government document that authorizes the export of particular goods in particular quantity to a specific end-user (Lee, 2021). This document is needed for the export of almost all kinds of goods. The Julian Company also requires an export license to export its eco-friendly fruits and vegetables to the European market.

Thus, Julian`s Company must fulfil all documental requirements for exporting its products without any barrier to the European market.

Recommendations of Incoterm for each group

Incoterms refers to international commercial terms, they define the responsibilities of the buyers and sellers for the sale of goods in international transactions. In other words, incoterms are a set of different internationally recognized rules that effectively outline the responsibilities of the buyers and sellers within the export transactions (Yang, 2021). The incoterms clearly outline the party who is obliged to cover the cost at each part of the international journey, the party responsible for the shipment at each part as well and who ensures that goods are insured.

There are 11 kinds of different incoterms, each kind is divided into four different groups such as E, F, C, and D. These categories are uncertain by the location of delivery as well as who is accountable for covering the cost of each part of the journey.

Incoterms Group E- EXW (Ex Works): According to the Incoterm, a major responsibility is on the buyer (Types of Incoterms, 2024). The Julian Company only ensures that goods are at the premise from where the buyer loads the goods for exports.

Incoterm Group F (Free Carrier): The Julian Company delivers the goods at the named location. It is a point where risks are passed to the buyer as the company fulfils its responsibility.

Incoterms Group C (Cost and Freight): Referring to this, Julian`s company pay the cost and freight to deliver goods to European markets, this cost comes under the seller.

Incoterms Group D (Delivered at Place): Till the unloading of the Company`s product in the European market the responsibility belongs to Julian Company.

Causes of risk in exports

There are several causes of risk while exporting the products, and Julian`s company must identify them.

Political risk: Julian`s company must ensure the level of risk regarding political terms as changes in rules, regulations, taxation policies and rise of conflicts, result in loss to the export company (Kochergina and Ryaboshapka, 2022). The company can mitigate such political risk by taking appropriate insurance in terms of export goods or any loss that occurs due to political risk.

Currency fluctuation risk: Another risk in export includes fluctuation in the exchange rate, decline in currency rate leads to a major loss. Julian`s company can mitigate it via forward contact. It means the company agrees to sell the goods at the pre-decided price on a particular future date. This makes it necessary for the buyer to pay the amount earlier decided, leading to saving the Julian Company even when the currency price drops by a major amount.

Aid from the Government and European community for products Julian market

The Julian Company get aid from the Government as well as the European community for exporting eco-friendly fruits and vegetables in terms of providing recession of tax. The Government charge less tax on eco-conscious fruits and vegetables as compared to other exported goods. This aid enables the business to decline its exporting cost in a significant manner. This leads to helping the Julian Company to keep their cost low while increasing profit in the best manner. In addition, the Spanish government provides flexibility to the Julian Company from the rigid rules and regulations of exporting goods. It leads to creates ease for the business to expand its business at the international level.

Conclusion

To sum up, it has been articulated that rules and regulations play an important role in international trade. The report is based on Julian Company which wants to expand its business of eco-friendly fruits and vegetables in the European market. From the report, it is evaluated that eco-friendly products and low operating costs act as a competitive advantage for a company. Further, the export company is required to fulfil documents like commercial invoices, packing lists and export licenses. The company can obtain information from reports from the World Bank, WTO and so more. In addition, to overcome the risk of political risk, and currency fluctuation, the company need to focus on forward contracts and insurance.

References

Books and Journals

• Cormier, B. and Manger, M.S., 2022. Power, ideas, and World Bank conditionality. The Review of International Organizations, 17(3), pp.397-425.
• Kochergina, T.E. and Ryaboshapka, A.I., 2022. Assessment of country political risks as an international business management tool. In Innovative Trends in International Business and Sustainable Management (pp. 13-22). Singapore: Springer Nature Singapore.
• Lee, B., 2021. License Processing for Biological Exports.
• Yang, J.H., 2021. A study on the reasonable choice and utilization of Incoterms 2020 rules from the perspective of logistics and supply chain management. Journal of Korea Trade, 25(1), pp.152-168.
• Zhang, S., Li, H., Zhang, B., Ai, S., Shan, Y. and Ding, S., 2024. Non-covalent in situ self-assembly of fruit peel waste into eco-friendly pectocellulosic bioplastics with high strength, flexibility and processability properties. Chemical Engineering Journal, p.158697.

Online

• Types of Incoterms. 2024. Online. Available through: < https://vinciworks.com/blog/what-are-the-different-types-of-incoterms/#:~:text=Currently%2C%20there%20are%2011%20different,which%20refer%20to%20various%20scenarios.>