Various considerations exist that a company should make before accepting or rejecting an overseas order. According toDaniels,Radebaugh and Sullivan (2007), every company must aim to make some profits from any export or import made. In relation to this, a company’s manager should weigh all the costs involved and benefits derived from exporting any goods. If the benefits outweigh the costs, then the oversea order should be accepted, but if the benefits are higher than the costs, the order should be rejected, because the company will be at a loss. A company should consider its business goals. If the export is not in line with the company’s goals, the company manager should not go ahead and accept any overseas orders.
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Researchers also point out that exports and imports place some demand on a business major resources such as production capacity, finance and human resources among others. Therefore, it is important that a company’s mangers consider this and evaluate whether the business can manage the demand the export will place on its resources. If the company’s resources fail to meet the demands placed by the exports, the order should be rejected. Before accepting an overseas order, the company should evaluate and see whether the benefits derived from the transaction are worth the cost. An export or import should increase a company’s capacity of utilizing its resources for improving its domestic business operations. According to business lawyers (2012), various legal issues exist that a company should consider before entering into international business operations. Some of these issues include the ability to ensure a successful business transaction, especially in cases where the country involved is politically or economically insecure, delay in delivery of the orders and unanticipated changes to exchange rates among others.
As explained earlier, a company has various factors to consider before accepting or rejecting an overseas order. Some of the considerations include the costs vs. benefits, demand placed on its resources such as finance and legal issues such as changes in exchange rate among others. These factors should be keenly considered to ensure that in the long run, the company benefits from any overseas order that is accepted.
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