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Presented b y: Kelly McIntosh July 7, 2016

Learn about regulatory issues, logistics, distributor selection, and pricing considerations when exporting food products. Understand key factors and steps involved in exporting successfully.

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Presented b y: Kelly McIntosh July 7, 2016

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  1. EXPORT STRATEGIES: The Supply Chain Unit GRACE FOODS DIVISION Presented by: Kelly McIntosh July 7, 2016

  2. So you want to export….Consider these: REGULATORY ISSUES LOGISTICS DISTRIBUTION & MARKETING PRICING AND COSTING

  3. Regulatory Issues What is the nature of your product? Determine the regulations governing entry in the country you want to export to eg. FSMA in the USA Are you an Authorised Exporter with JAMPRO? Do you qualify for Caricom Status? Critical to compete with goods from T&T and N. America The Certificate of Export for foods from JBS is no longer required, but manufacturers still have to batch test and get JBS approval before exporting. Have you satisfied the Veterinary Services Divisions requirements?

  4. LOGISTICS Important Considerations: Shipment size/Freight Cost: to consolidate or not? Transit Time & Rates Customs Brokerage: to navigate through ASYCUDA; harmonized tariff codes Insurance AEO status with Jamaica Customs Mandatory Verified weights of all outbound containers. ISF Filing for all US Bound shipments

  5. Does size really matter? Consolidate where possible with other shippers to the region Ship to your Caricom customers’ freight forwarder in Miami if possible (regulatory constraints) Ship LCL

  6. Distribution Distributor selection is key! Get recommendations Assess financials Seek to set up a formal agreement with performance targets Assess their warehousing & inventory management Look at their own distribution channels Look at their sales, merchandising and marketing resources

  7. How to choose a distributor? Criteria may vary by company, but it’s a combination of: Experience with similar products and consumers Resources - working capital and operational capacity Coverage - universe of customers Fit or “style” during the negotiations And in the end, ask the right questions. The most beautiful girl may not be the best wife. Choose the most suitable distributor

  8. Preliminary considerations Which consumers are being targetted? Where are they located? What is the cost of own distribution versus outsourced distribution? What type of distributor do I need? Talk to as many persons as possible to gain insights JEA, fellow exporters, visit the market, talk to retailers etc. Then, try to get a list of prospects.

  9. Are they financially sound? Can they pay you? Credit check is necessary – credit checking agency or their bank Get referrals – retailers, customers, other exporters Credit sales are risky more with large volumes A bankers guarantee, or A letter of credit

  10. Coverage Analysis Is the distributor well established in the market What geographical area(s) does the distributor cover? Is it consistent with the coverage you desire? And, where your sales prospect are best If not, are they able and willing to expand? Are they covering all channels in the desired area. Do they have good penetration in these channels

  11. Principals How many principals is it currently representing? Are these brands market leaders or strong players Would you be its primary brand ? If not, what percentage of the total business would you represent?

  12. Product Mix How many product lines does it represent? Are these product lines compatible with yours? Will your products be given the requisite attention? Would there be any conflict of interest? Does it represent any other principals? If necessary, would it be willing to alter its present product mix to accommodate yours?

  13. Sales Force What is the size of the sales force? Do they have any experience with a similar product line Would it need to expand to accommodate your account properly? If so, would it be willing to do so? What is the performance of the sales team? How well do they know the trade? Research the distributor performance in-market What is sales reporting culture

  14. Marketing Is there a marketing team to coordinate marketing activities How will marketing investment be shared How does it monitor product performance? How is consumer behaviour assessed? How will new consumers be won?

  15. Logistics Does it have adequate warehouse facilities? What is its fleet and delivery capacity? Technological and communications capacity Stock management and inventory control

  16. Distributor comparison matrix

  17. Distributor Management Measure 2x per year against agreed on targets Agree on A&P plans and spend Agree on pricing in the market

  18. SUMMARY Make a selection from your shortlist Start with a short contract (one year) or, A Probation phase or trial period Ensure that the selected distributor values your business If you can, select your distributor by region Ensure it’s a good size match Big distributors like big brands and market leaders Small distributors may rely on you for all resources Agree formally on how the partnership will work

  19. PRICING & COSTING Know your costs: Material costs (if you manufacture, your total cost of production) Export related costs (port charges, truckage, certification charges, etc.) The Landed Costs in your intended market (duties, clearance etc.) PRICE = COST + MARGIN You want to sell today…and tomorrow and next year…

  20. Thank You!

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