What Are Practical Difficulties In Foreign Trade?


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Nouman Umar Profile
Nouman Umar answered
There are many problems in foreign trades.

Language: when the goods are exported to a foreign country, the labels, informative literature, packing technical handout, should be prepared in the language of the century in which the goods are marketed. There should also be salesmen who are versed with that language and know the habits and likings of the people.

Standardized Units: In some countries of the world, the units of length, weight, capacity, voltage are not the same. The exporters therefore shall have to see that the goods are prepared and supplied according to the standard specification of the importing country.

Sale in foreign currency: Every country has its own currency which is not legal tender in the other country. Buyer abroad prefers to buy the goods in his own currency just ass seller prefers to sell in the currency of his own country. The exporter therefore has to calculate the selling price of the goods into the currency units of country where the goods are sold taking into consideration due fluctuations in the foreign exchange rate. The exporter can protect him against possible loss in foreign exchange by hedging.

Licenses and documents: When goods are exported or imported a number of documents are to be prepared.

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