Export Intermediaries For Sanitarium Health Food Company Marketing Essay

In the international trade, export intermediary is an average export setting, which is used by many companies. Sanitarium Health Food Company is a famous food company in Australia and New Zealand. Among the products named Weet-Bix is a high retailer in Australia and New Zealand breakfast time market. (Mellentin, 2003) Sanitarium Health Food Company exports the Weet-Bix by export intermediaries. The goal of this statement is to analysis the research on role of export intermediary in the international trade for Sanitarium Health Food Company. Initially, this article will describe the background of Sanitarium Health Food Company and its own exporting product. Following it, this statement will analyze the study methods. From then on, it'll discuss the trade intermediaries and its own role. Then, it'll describe the export intermediaries that Sanitarium Health Food Company uses and its functions. Finally, it will be a finish of the report.

Introduction

Sanitarium Health Food Company was built-in 1898 in Melbourne. The word "Sanitarium" means to link good diet with well being. Sanitarium, proudly 100% Australian held, is rolling out a reputation for processing quality health and vegetarian foods - a posture that is rewarded by the strong consumer trust we enjoy today. (Julian, 2003) At present, there are roughly 1700 employees across Australia and New Zealand in Sanitarium Health Food Company. The business can achieve gross annual turnover of around Au $300 million. Sanitarium gets the largest developing site in New South Wales. Sanitarium has almost 100 years experience in exporting to over 30 countries worldwide - including the UK, Asia, america and the South Pacific. (Parr, 2006) Weet-Bix is the most popular breakfast brand in the breakfast industry in Australia, which includes continued to be for 30 years. Weet-Bix belongs to high-fiber breakfast biscuits, which has high nutrition. Maybe it's put on any age, especially for babies. Each year, many Weet-Bix is exported to different countries on the globe.

Research Method

The focus of this report was primarily on a qualitative evaluation and targeted at discussing the business's export intermediaries. A quantitative questionnaire is employed to analyze the export conditions in order to choose appropriate export intermediaries. Data collection is mainly through paid survey or articles to support the examination. Through Internet, it could be convenient to find the info of situation of Sanitarium Health Food Company very obviously. Some data is sourced from Sanitarium Health Food Company's website, so it is reasonable and effective. Questionnaire is completed by several employees in Sanitarium Health Food Company since it can understand much about the company. Through this way, it can gain more specific information and also have the culture of Sanitarium Health Food Company.

3. 0 Talk of Export Intermediaries and Role in International Trade

3. 1 Export Intermediaries

Export intermediaries participate in one of indirect exporting programs. Export intermediaries will be the agency to cope with export business after taking the consignment of exporting companies. Export intermediaries don't have title to the goods and they are prohibited to export goods to foreign buyers by utilizing their own names. On the other hand, export intermediaries do not afford the risks plus they only help the exporting companies to market the products. Exporting companies should afford the hazards if having. Export intermediaries may work together for several exporters based on commissions, salary, or retainer plus commission rate. (ATS, 2009) Usually export intermediaries achieve an arrangement with exporters and both factors will match the rights and responsibilities in the arrangement.

Nowadays, the most common intermediaries are Export Management Company (EMC) and Export Trading Company (ETC). (Balabanis, 2005) Export Trading Company has expertise, funds, wide selection of channels to contact foreign distributors over time. Furthermore, it is with the capacity of sensitive information systems, such as certain benefits of preferential procedures. Export Management Company is a specific organization for the production company to engage in export trade. Plus they generally adopt the techniques of direct real estate agents. The advantage of Export Management Company is to have a foreign trade stations and information pros. (Cooper, 2005) In Melbourne, there are hundreds of EMCs and ETCs. Potential exporters should develop a set of those ETCs and EMCs which specialize in exporting the types of products proposed to be sold abroad. (Terpstra and Sarathy, 2000)

3. 2 Role of Export Intermediaries in International Trade

Export intermediaries play an important role in the international trade and it could be talked about from three aspects.

Firstly, export intermediaries possess the abundant international market experience and international channel. It can benefit the companies to explore the overseas market rapidly. When exporting companies are not familiar with foreign market, they could consign the export intermediaries to market the products to foreign clients immediately. Thus export intermediaries would be convenient for the exporters in the international trade and exporters could avoid sophisticated process of international trade rather than paying fee to export intermediaries.

Secondly, with the existence of export intermediaries, the complete international trade process can be simple. Export intermediaries provide for exporters and deals with the entire export method. The exporting companies only need to be in charge of processing and sales. The contribution of export intermediaries makes the job section of work become very clear. Each side mixed up in international trade has clear responsibility and international trade will have a good order.

Thirdly, the engagement of export intermediaries in the international trade could assist the exporters to save the expenses. If choosing the export intermediaries, the exporting companies do not need to build overseas branches and employees to research foreign market. Under this scenario, it can help the exporters to save the direct channel costs. Inside the international trade, exporting companies could save capital burden, which helps bring about the exporting amounts.

4. 0 Discourse of the Export Intermediaries that the Company Uses and its own Functions

4. 1 Export Intermediaries that the Company Uses

Sanitarium Health Food Company's products have been exported to many countries, including USA, Canada, Singapore, Japan and so forth. The following stand shows the export level of Sanitarium Health Food Company. Because of many exporting volumes, the company would like to simplify the process of exporting. In this situation, Sanitarium also chooses the export intermediaries. (See Appendices 2) Sanitarium is mainly for manufacturing the merchandise, so they will use simple way in the international trade. Therefore, export intermediaries are proper exporting mode for exploring foreign market of Sanitarium. This means that Sanitarium BALANCED DIET Company entrusts the export intermediaries to market the merchandise in international market. Through export intermediaries, Sanitarium can improve the sales of products into overseas market fast through intermediaries' experience.

Usually, Sanitarium Health Food Company selects Export Management Company to export its products. As the business has huge export amounts, it is impossible for Sanitarium to cooperate with only 1 Export Management Company. Sanitarium exports the merchandise to different countries. According to different trade countries, Sanitarium will choose different Export Management Companies. Different Export Management Companies have their own advantages in different countries. Sanitarium thinks the trustworthiness of export intermediaries is very important since it may directly influence the sales impression with their products. As a result, Sanitarium selects export management companies with good reputation to cooperate with. Export Solution and Cornel Exports Australia Pty Ltd are current cooperated export management companies with Sanitarium. Through them, Sanitarium Health Food Company could export their products to abroad smoothly.

Source: implemented from Wrenst A (2008), Products of Sanitarium Food Health Company, Journal of Food Industry, Vol. 107

4. 2 Functions of Export Intermediaries

The Export Management Companies which Sanitarium Health Food Company uses has effective functions in exporting products to abroad.

Before organizing exporting business, Sanitarium Health Food Company signals contract with Export Management Companies. Inside the agreement, it plainly regulates the merchandise, intermediary range, storage space and transportation, payment, and other responsibilities. Export Solution and Cornel Exports Australia Pty Ltd serve as a liaison and specialist between Sanitarium and its foreign potential buyers seeking to buy products from Australian manufacturers. Through its network of trained and experienced international marketers, Export Solution and Cornel Exports Australia Pty Ltd interconnect world market segments to optimise opportunity. Export Solution and Cornel Exports Australia Pty Ltd are the hyperlink between new ideas, products, and services with desired export markets. While using contribution of Export Solution and Cornel Exports Australia Pty Ltd in the international trade, Sanitarium can get benefit from their experience in exporting. At the same time, importers can also obtain reap the benefits of a sales team dedicated solely to international sales and customer support. (Lord, 2000) The trade experience of Export Solution and Cornel Exports Australia Pty Ltd may help both Sanitarium and its own foreign buyers for the best possible business final results. Sanitarium Health Food Company could have an access to build an international network in potential target market. In meanwhile, Sanitarium Health Food Company could reduce advertising, general and administration expenses. As a consequence, Export Management Company can help the Sanitarium Health Food Company to involve in the international trade more effective. Export Solution and Cornel Exports Australia Pty Ltd are current cooperated companies. With their help, Sanitarium has good performance in exporting business to overseas market.

5. 0 Conclusion

The cereal products of Sanitarium Health Food Company have been ever exported to numerous countries. To be able to achieve goods sales in international trade, Sanitarium must select good market accessibility mode. For quite some time, Sanitarium always decides export intermediaries for exporting process and they have final results in the international trade. Sanitarium Health Food Company usually cooperates with Export Management Companies for participating in the export business.

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