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Problem: XYZ Pvt. Ltd. has been engaged in the business of plastic toys for the last 5 years in New Delhi. Mr. X, the Managing Director of the company had conducted a study to understand the export potential of his range to toys. After a detailed study of the market reports on toys, he came to the conclusion that there was a lot of potential for the export of toys to the countries in the Middle East and West European countries. He has his own manufacturing unit at Okhla in New Delhi and commands 23 per cent share of the market for toys in India. The value of production, sales and earnings before interest and taxes (EBIT) for the last 5 years are as follows:
Year
Production(Rs. in Lakhs)
Sales(Rs. in Lakhs)
EBIT(Rs. in Lakhs)
1995
1996
1997
1998
1999
50
95
135
180
230
60
104
162
216
276
5
9
15
20
25
He now plans to diversify into exports but does not know how to begin. He has engaged you as his export trade consultant and desires to know the initial formalities to start the export business and how to plan for marketing of the toys.
Question: You are required to prepare a detailed note advising him the initial steps that he should take to diversify into the area of exports and a complete Export Marketing Plan for execution.
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