Challenges Faced By Nigerian Exporters in International Trade
The export business by its very nature faces certain challenges and risks. If not dealt with appropriately, these challenges can put exporters out of business. The challenges faced by Nigerian exporters in international trade are demanding and can delay the exporting process a lot. As difficult as international trading might seem to you as a beginner, there is a solution to it all.
However, if you are a starter or already into export business and wants to stay away from problems, you must recognize the risks that may occur when attempting to take hold of the trade potentials from goods leaving the port to cracking into a new market, the trade of manufactured goods faces various logistical challenges at every step along the way.
Below are some of the challenges faced by Nigerian exporters in international trade
- Diversity of languages
- Different currencies
- Regulatory measures
- Frequent Market Changes and Differences in weights
Diversity of Languages
Language barrier can have a negative impact on international trade and could have serious financial or strategic implications. Gaps in communication or miscommunication with a customer can easily end a business relationship. However, you need to note that when you are dealing with people who don’t speak your language, make the process as easy as possible for them.
Distance and Transportation
Distance is one of the challenges faced by an exporter. You may experience difficulties when shipping goods to far countries. Higher costs of transportation and greater risks may arise if proper logistics are not put in place and could lead to temporary delay in the delivery of goods. You need to know the different forms of transportation to use for safe and timely delivery of goods. To avoid problems and shipping delays, make use of a reliable and dependable international freight forwarding and shipping company to understand the fundamentals of shipping in order to reduce cost.
A lot of countries make use of different currencies which need to be converted to and fro using existing exchange rates. Exchange rate changes daily and fluctuates at times and could lead to difficulty in making payment. You will need assistance when trading with such countries and also be in constant communication with a reliable importer to save you from unpredictable issues that might occur when making payment.
A large number of documents are needed in international trade. These documents are very important in the exportation and importation of goods and are required either under law or under customs of trade of the two countries. See list of documents needed for importation of goods in Nigeria and Procedures in the exportation of goods in Nigeria. In these articles, you will get an insight on various documents and licenses involved in international trade.
Every country has its own laws, customs, and import/export regulations. These measures are placed on tariff barriers (custom duties) non-tariff barriers, quota restrictions, foreign exchange restrictions, technological and administrative regulations, consult formalities, state trading and preferential arrangements, trade agreements and joint commissions etc. You have to carry out all the custom formalities as well as follow rules controlling exports and imports.
Frequent Market Changes and Differences in weights
Changes in demand and supply can affect international trade. Many countries use grams and kilograms as the standard measure of weight and other countries use pounds and ounces. In this case, Inflation and high prices are staring you in the face. If the situation persists it may put your price level beyond the means of your customers abroad, no matter how badly they need your export. You need to consider the changes in the market before exporting goods in Nigeria.
In conclusion, the only way to properly assess and mitigate the possibilities of encountering challenges in international trade is through reliable information and services offered by reputable freight forwarding agents and trading companies in your target market.