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Should companies focus on export?

Importance of Export

In the globalizing world, along with the development and strengthening of scale economies that define competitive advantage, foreign trade processes have become a necessity as well as opportunities for development.

Many factors affect firms’ orientation towards foreign trade. In scale economies, firms are also important in directing foreign trade. With the advantage of economies of scale, it is able to import products or services that it can not produce or produce at low intensity with its ability to reduce production costs, so it can integrate with foreign markets.

It is no longer inevitable for the enterprises that move with the vision of efficiency, to export, to take place in the globalizing competitive world, and to keep their assets in this direction, because importing for whatever reason may increase the external dependency of the country, while domestic economic balances may affect exchange rates.

An operator who has reached sufficient capacity in the domestic market needs to export in order to maintain its continuity in the future. Achieving growth and sustainable profitability depends on minimizing internal and external market risk, turning to new alternative markets and exporting. In this sense, exports increase the quality of life and ensure the branding of the countries in the global market (Çetin, 2016).

Turkey turned its face the development model based on exports. This model is provided with favorable conditions to businesses that adopted the decision to export in Turkey, supported by their export support programs are provided. For example; Turquality state-supported branding program, which offers great opportunities for exporters in Turkey. In addition to Turquality, such as Eximbank support, tax reductions, Small and Medium Industry Development Organization support and state support for export to SMEs are also factors that will enable companies to look at the imports positively.

Companies should export not only to support of exports but also to keep their assets balanced and long lasting, taking into consideration the risks that can be foreseen by their operations and over time. Over time, possible reasons for demand reduction in the domestic market, possession of products that reach the saturation point and idle capacities may cause companies to export. Companies that have been able to open up to the right markets with such risks, may find their place in foreign markets to their satisfying products, .

Opening to foreign markets is certainly a process. Innovative point of view and the need to be in harmony with the competition. Exports, which allow even the idle capacities of large enterprises to be assessed, may allow small businesses to see and evaluate competitive environments as well as bring innovative ideas to their domestic markets and become stronger in the domestic market.

 

Münevver Keçeli

Source: Çetin, K. (2016). The effect of the innovation to the export performance: The sample of Karaman province. Karatay University. SSE.

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MKeceli

Looking for job opportunities on international trade. Graduated international trade and logistics master. Living in Kepez, Çanakkkale.

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