Showing posts with label MOQ FOB. Show all posts
Showing posts with label MOQ FOB. Show all posts

Friday, December 16, 2016

Meat Trade

You probably eat a lot of meat, like I do, and I am keen on good meat.  Here is an edifying article on the int'l trade in meat: 
"This week, there will be many remembrances of what we've accomplished in this organization over the past 40 years, and everyone here should take great pride in that, but for most of you, it's not the past that drove you to attend this meeting. It's about what we're going to do today, tomorrow and into the future," Philip Seng, USMEF president and chief executive officer, told attendees.
There is that forty year perspective again, what happened after Nixon took us off the gold standard (lite).  So this article is about "It's not the hand you are dealt, it's how you play the cards."  This is how the meat industry played the ex nihilo credit card, if you'll pardon the double entendre.
According to Seng, the U.S. eclipsed $13 billion in meat exports. “That’s quite an accomplishment when you consider some of the challenges we’ve had over all these years,” he said, adding that the goal is for $20 billion in meat exports in the near future.
Here again, in an ex nihilo credit regime, he who borrows the most wins.
Some recent highlights for U.S. trade include that the U.S. beef industry just surpassed Australia as the number-one supplier in the South Korean market. The U.S. also recently passed Australia in chilled beef exports to Japan, which Seng called a milestone.If there was any doubt that trade is important, Seng pointed out that 80% of the world’s buying power lies outside of the U.S., so “the more we can have this export mentality, (and) the more we can challenge ourselves to do better, the better it is going to be for all of us.”
This is Big Meat talking, the same people who make it criminal to test USA beef for mad cow disease in order to promote exports.  (It's a criminal offense to even own a test kit without a license.) Mad Cow takes anywhere from 2.5 to 5 years to incubate, so USA got rules pushed through for countries to accept USA beef under three years old.  lemme see...  2.5 years to incubate, sell three year old beef....  hmmm... did anyone do the math?

1. They are not sure what it is.

2.  It is hard to spot, making it hard to control.

3. It is hard to kill, and the killing process relieves the meat of most nutritional value.

4. It is 100% the result of cruel and stupid animal farming.

But it makes cheap bovine meat at the cash register, but Big Meat gets so much in up-front subsidies and preferences, plus the cost of the damage done is after the fact, so here again we have the fascist Big Government and Big Industry acting as one, to privatize profits and socialize losses.

(Grass fed beef is natural and popular, and on unused "government land" it can be produced inexpensively.  This is why the FEDS kill ranchers who won't back off from grazing rights, as in Oregon.  This terrorism is employed to smash any competition for Big Meat.)
The Chinese market has provided some success stories for the U.S. Seng noted that there are now nine pork plants in the world’s fastest-growing market for pork. However, challenges remain, as it’s still not easy selling in China, he said, adding, “It’s not the most transparent place, and it’s very hard to follow product in that market.”
Unh... mendacious!  USA pork is fatted up with ractomine, an additive with criminal consequences in every country in the world except the Nafta three.  Since USA Government cannot be trusted with inspections, the Chinese have bought their own pork processing plant in the USA to serve China.  Only Big Meat Americans cannot figure out how to sell to China.  Their only tactic is get subsidies, compete on price.  Also, tracking every pound of pork exported to china is cheap and easy.  Use QR codes.  And QR codes are the small business, specialty meat secret weapon to marketing to China.
"Trade is no longer rising around the world," Seng explained. "Actually, this is the first time since World War II that trade has declined during a period of economic growth. That's why what we are doing in the meat industry — whether it's the beef complex, the pork complex, the lamb complex — the fact that we are increasing our exports (means) we're really going against the grain right now, because most industries are not enjoying robust export sales."
If trade is not rising, this is very good news.  It means that the ex nihilo credit regime is over.  Russia has surpassed USA in wheat exports, when they used to be a importer.  The abominable USA ex nihilo credit regime is dying.  All markets for meat are growing, because people spend their first experience of new disposable income on food.   USA Big Meat product is cheapest at the cash register in China as well as USA.  What with export subsidies, tax advantages and financial engineering, exports give Big Meat Industrial Complex an ability to privatize profits and socializes losses, on steroids (pardon the mixed, but apt, metaphor).
Seng referenced World Trade Organization data showing that 2,100 new trade restrictions were imposed from 2008 to 2016. Sometimes, it may seem like there are fewer trade restrictions and more free trade agreements, but he said, “frankly, we are still in a very protectionist world.”
USA has never signed a free trade agreement, because there is no such thing as a free trade agreement.  If it is an agreement, then it is managed trade, not free trade. And for Mexican Harvard MBAs to write 14,000 pages of "agreement" with Canadian and USA Harvard MBAs, that protect crybaby billionaires from free markets, then you better call it free trade agreements, in case someone notices.
Fifteen countries account for 63% of world trade. “What that means is there are certain countries that are franchised in, and there are certain countries that are franchised out,” Seng said.
"This is one of the challenges we have with the WTO," he said. “There are more losers than actual winners when it comes to trade, just given those 15 countries. Usually, it’s those 15 countries that write the rules, so it’s become quite complicated when we take a look at international trade.”
Oooooh...  I like this guy... he slipped it in.  It's a racket.  He has to be careful not to lead with that point, but he knows well what is going on.
The challenges ahead, according to Seng, include the state of the Korean economy, the impact of Britain's vote to leave the European Union and whether societal norms will begin to affect trade deals.
The paramount question on everyone’s mind, however, is how to deal with the “tsunami of meat” heading toward us, Seng said. It will be key, he said, to focus on what can be done over the next couple years to move more meat, as well as what can be done for demand enhancement in this industry.
As he must well know, it is over for Big Meat.  To have used ex nihilo credit to wipe out the markets for countries that traditional supplied the world such as Vietnam was once king in rice, Argentina in beef, and Russian in wheat (see the Hanseatic league), and so on, USA was able with ex nihilo credit and guns to knock all of those "comparative advantage" countries out of the game.  Winning a this is a Charlie Sheen kind of winning, where you wipe yourself out in the process.  In the USA the runoff from Big Meat is horrifying and invisible, plus expressly not tested for by the EPA.  Massive water is diverted to grow GMO crops such as rice and cotton, distorting the natural economy massively.  Food that is poison, small business wiped out by ex nihilo credit-based costing, malinvestment and misallocation of resources, especially land, and the pollution, have taken a horrifying toll on the USA economy.  The damage is done during the ex nihilo credit boom.  When the bust comes, the only question is "who pays."  Never the people who gained from the damage done.

The solution is simply end the subsidies to Big Meat, and deregulate Mad Cow testing. At the same time, people need to work hard developing markets for USA produced good food, so the good food producers (necessarily specialty) can grow their operations.

One reality is wherever the USA has introduced a market for Meat Industrial Complex compromised products, there is always as specialty market growing alongside.  So where USA exports the most, there is the most likely specialty market.

It cannot be foreseen, it must be searched and learned.  How to is no secret, I learned it from people in the business, and he meta studies confirm how to, it is just apparently i am the only person who teaches it.

If you have a passion for food, and want to start a business doing the urgent work of restoring balance in world trade and protecting specialty food in USA, then I have a hard core online course open to anyone in the world.  The next session is coming up in January.  If you wish to enroll, you may do so here.  If you do not see your local school, you can scroll down to the bottom of the page and enroll directly with me.  I'll bill you the course fee after the course.  Don't worry if you are overseas, the tools, tactics and attitude apply in all countries.  I am happy to have you enroll too.

Feel free to forward this by email to three of your friends.


Monday, December 12, 2016

Export Food - Repping Supplier Approach - LCL MOQ FOB Part 2


This is part two, part one yesterday...

On Nov 27, 2016, at 11:18 AM, J L wrote:
Hi John,
Appreciate you taking out the time to provide such a detailed feedback. The "Answer matrix" is amazing and very helpful.  
I actually liked the idea of having the LCL MOQ FOB listed on his website. It puts the supplier at ease in terms of transparency ( which you have been advocating all along ), they are still in charge of their product and will probably make them comfortable doing business with me. It's a win win situation for both parties
I've cleaned up the concluding statements in the draft and also made the other changes you suggested. Please let me know how it looks?.
I like "Brothers L". My brother's name is K’yo and I was also thinking of names like Kyoto or Tokyp by combining both. Though they sound more Japanese than Ghanian :). What do you think?
By all means strip and edit this as an example if it helps.
Thanks,
J

On Nov 27, 2016, at 12:00 PM, J L wrote:
I've included "export" in the letter for specificity. Thanks!

You're right. I checked the HTS for units and it is Kg. So then is the analysis correct?. The Specialty Snack chips, 1 packet is 5 OZ and cost ~ $5 (retail). For Mexico the average price is $4.55 per Kg!
***Right, mostly chips...  at costco chips are about that...  he might say, that's too cheap, you reply..

a. that includes the cheapest mass produced chips too, it's the average, so skews very low give the mass amount of bad chops going in...  

b.  the bigger the mass market, the bigger the specialty market too...  

It's the trends that tell... ***

From point "b", should I initially be targeting Canada then in lieu of Mexico even though the average prices are lower?
JL

On Nov 27, 2016, at 12:09 PM, John Spiers wrote:
Hmmm... do either on either justification... just pick one narrative to start...

John


On Dec 2, 2016, at 1:03 AM, J L wrote:
Hi John,
Thanks for another fantastic session this Tuesday. I have mailed out the initial letter and wanted to be prepared just in case he calls me before our scheduled time this Tuesday. I have started a different email thread since we are on the next phase and also makes it easier.  

So the "Answer matrix" from previous email ( At the end of this email & Thanks for that! ) is an initial Introduction of myself & a proposal on how we can mutually benefit by doing business together. Assuming he's interested, he'll either start getting into specificity then and there OR will want to think about it and get back to me OR will ask me on how I want to proceed [ I'm assuming you'll say "Right Now over the phone" ?? ].  Was hoping me you can give me some guidelines on the following details which I think will be fundamental to our discussions and If there's something else you think might come up in the discussion and is important, please let me know

MOQ
Will the owner provide this?. If I have to come up with MOQ, I have absolutely no idea on what would be the ideal "smallest rational possible" quantity or how to go about finding that out.


Manufacturer Price ( ExW) / My Commission
On his website, he has prices quoted for 1 & 2 packets. Price for 8 packets have a reduction of approximately 12.2%. Going by that assumption, I came up with price for 1024 packets [ Hypothetical MOQ ]. The store I bought them from sold it for $5.50/packet 
Now I know the reduction will stop at some point but am not sure what I can expect a reasonable price to be. As I'm writing this, I'm guessing you'll say that I should just take his price quote and get back with reliable and validated test data. 
Should I go with 10% commission as suggested in the class?.
packets

Pricereductionmatrix.xls

JL

On Dec 2, 2016, at 6:31 AM, John Spiers wrote:

On Dec 2, 2016, at 1:03 AM, J L wrote:
Hi John,

So the "Answer matrix" from previous email ( At the end of this email & Thanks for that! ) is an initial Introduction of myself & a proposal on how we can mutually benefit by doing business together. Assuming he's interested, he'll either start getting into specificity then and there

***Yes, and you're best answer is "I don't know... and it will be fun to find out..."  (Will I have to change the packaging? Who in Mexico do you have in mind?)

A N D

No, I don't want or need an exclusive

Yes, you can say forget it... (except for the one, first LCL MOQ FOB)

Yes, you can fire me...  because I am not your employee and don't have anything at riak but some time spent doing something interesting, trying out my learning...

OR will want to think about it and get back to me

***  All I need is weights and measures of say a pallet load, what price YOU want, where I can pick it up from you, and  what would be the lead time, a month?  Then you can think about my export offer, after you see it,  is it something you want out there?  Start your thinking then, when you have something solid to look at.  If you say no, I'll be trying Bison Jerky next, but I like your product more. "***

MOQ
Will the owner provide this?. If I have to come up with MOQ, I have absolutely no idea on what would be the ideal "smallest rational possible" quantity or how to go about finding that out.

***Yes, must...  they have one already for domestic sales, but yours may be bigger, but usually no more than a pallet load.  You see on the template we need the weights and measures (H,L. W each and total) of the cartons, add the pallet height, and the price he wants to earn on the sale (ExW), and his delivery lead time, plus where he wants the goods picked up.  You might just have a rough draft template of the LCL MOQ FOB form with those blanks highlighted to email him, so if he asks how you want to proceed, you can just email him that .pdf.

Smallest rational really gets to logistics cost; if you get 100% more product for 5% more logistics cost (FF will point this out), then yes, jack up the qty to make the offer more attractive, but no, never a full container load...  two pallets is max for a test, and we are testing at this point in the export game.  There is back and forth on the LCL MOQ FOB development.  Measure twice, cut once....  remember, you are stuck with your lcl moq fob through 100 inquiries...***


Manufacturer Price ( ExW) / My Commission
On his website, he has prices quoted for 1 & 2 packets. Price for 8 packets have a reduction of approximately 12.2%. Going by that assumption, I came up with price for 1024 packets [ Hypothetical MOQ ]. The store I bought them from sold it for $5.50/packet 
Now I know the reduction will stop at some point but am not sure what I can expect a reasonable price to be. As I'm writing this, I'm guessing you'll say that I should just take his price quote and get back with reliable and validated test data. 

****Precisement!  You are testing prices too.  The higher the better.  You get data back from your effort, for future reference, iterations.***

Should I go with 10% commission as suggested in the class?.
Yes.


His discount is probably an example of the folly of price cutting, he has no economies of scale to offer...  it probably costs him close to your 64 box discount....

Just take his price and work with it...

And make sure you keep records of all of this activity with the potential supplier.  You add this to your rolodex of your contacts in the international trade of specialty chips.

As usualy feel free to email...

This is fun...

John


Feel free to forward this by email to three of your friends.


Friday, November 4, 2016

How To Build Export Sales In Four Steps

Redo your spreadsheets, look for differences.   Here comes the announcement at USITC.gov:
* Aug, 2016 trade data are now posted. Our practice is to update Dataweb as soon as possible after the Census Bureau releases monthly trade data, generally within three business days.Notice: The import and export data on Dataweb for 2010-2015 have been updated as of July 2, 2016 based on the latest official revisions from the Census Bureau (the first official revisions for 2016 data will not be available until June 2017). For the years prior to 2010, Dataweb will continue to show import and export data as originally issued by the Census Bureau with no revisions.
Yes, we begin with passion and joy, and then ground our strengths in what real world trade data (commodity, prices, target markets, trends) to form a scientific hypothesis to test.  Central to proceeding in int'l trade is the rock solid trade data.  Not the pointless junk you can buy at the 4 digit HTS level, but the most specific 10 digit level, which can only be had by gathering and analyzing it yourself, by hand. And in so doing, you have information no one else has.  Knowledge is power.  Five years is enough trend info, and then there is the practical problem wrong numbers stay wrong after five years.

And you must keep up on the trends.  So every year say around April, the full year data may be updated.  But when you find something that just looks dead wrong, like the price of caviar exported from USA (yes, we do...) then you must jump on it and get a review:
From: "M DDate: May 13, 2015 2:38:36 PM PDTTo: "johnspiers@b
Subject: Data Inquiry
Dear Mr. Spiers: This refers to your email concerning the unit price for exports of caviar (Schedule B number 1604.31.0000) to Japan during 2014. We have reviewed the data and have revised the reported statistics. Please make note of the following attachment and revisions to our published statistics. Thank you for your interest in the accuracy of our trade statistics. If you have further questions contact *****  The attached revisions are also available on our website at: www.census.gov/foreign-trade/statistics/corrections/index.html In June, our revised monthly data for the three prior years will be available through our on-line data product, USA Trade. For information on our current revision policy go to: www.census.gov/foreign-trade/guide/revisions.html
So here are the changes made after the challenge:


Corrections to Published Export Data

MonthYearACTIONTypeERRATAHSCountryQty1Unit1SWTFAS
Value
April2014READS:Domestic20161604.31.0000Japan1,312KG1,489$19,368
SHOULD READDomestic20161604.31.0000Japan74KG1,489$19,368

 
May2014READS:Domestic20151604.31.0000Japan15,045KG30,804$222,097
SHOULD READDomestic20151604.31.0000Japan589KG30,804$222,097

 
July2014READS:Domestic20151604.31.0000Japan7,986KG9,064$117,896
SHOULD READDomestic20151604.31.0000Japan288KG9,064$117,896

 
September2014READS:Domestic20151604.31.0000Japan40,429KG21,759$1,097,248
SHOULD READDomestic20151604.31.0000Japan21,847KG21,759$1,097,248

 
October2014READS:Domestic20151604.31.0000Japan24,515KG13,517$970,738
SHOULD READDomestic20151604.31.0000Japan12,953KG13,517$970,738

 
November2014READS:Domestic20151604.31.0000Japan19,145KG21,729$282,607
SHOULD READDomestic20151604.31.0000Japan637KG21,729$282,607

 

Source: U.S. Census Bureau, International Trade Management Division, Washington, D.C., 20233

The analysis on the original trade data looked ridiculous.  The client whose first foray into trade data analysis, in this case the trade data on caviar,  rejected it as impossible, evidence of criminal activity, anything except reality.  I advised him to challenge USCensus on the underlying data, and indeed they found it wrong (unlikely a Census problem, most likely a source problem corrupted data at the collection point, etc.)

Now, since we work at the ten digit level in data analysis, the new caviar trader introduces himself with information, at that point only someone in USCensus and he could have, could possibly have (OK< also me, but I am not in caviar), for a month or so.   The trader with this may make news, enhance his image and grow his business, as Ogilvy demands.

Yesterday I received this, in part of an email, from another student...
...the VP of sales I spoke with today told me "obviously you (meaning me) have been exporting for years"!  I explain my plan just as you outlined in your class (did not tell me I just completed my second class with you on Tuesday).
I followed up as you stated and found out the person I tried to contact is no longer with the company so I sent the same information update with the new VP sales contact information and we setup a call to review the opportunity to be a selling agent with them.  Finally schedule this morning.
My first question was are you currently exporting, she said no but do have sells in *****.  I told her from my data ***** and ******* are markets I would not presue because they are NOT growth markets and the price per kilo in on the decline.I explain my test market 1 size fits all (preselected pallet of product) with the MOQ FOB LCL and creating a website for serious buyers only.I told her it will be the same as a domestic order.  Her major question was who pays for all the export fees etc...I told her the buyer who imports that is their responsible.
Just so...  what I present in my classes is what I learned on the job the first decade I worked for others.  I've been self-employed since then.  I teach on the side, and as such have gathered the meta-study data that shows what I teach is also how it is done.  It is no secret, but I am the only one teaching it.  For reasons I can only imagine, no one else teaches what is effective.

The work is also crucial to economic recovery, as in YOUR economic recovery, so I am running another special session of my online seminar:

Fall Special Session  2016 
11/15- 12/6/2016   Four Sessions
Section One ~ 6 PM to 7 PM Pacific Time
(This would be 7 PM to 8 PM Mountain, 8 PM to 9 PM Central, 9 PM to 10 PM Eastern)


The tactics taught here relating to food can be used for any product, but the specificity fits with the brevity.  Here is more info on the course, and you may enroll here.... (scroll down to the bottom of the page and use the form at the bottom of the page for this special session.

eMail me if you have any questions. (Ask John in upper right)

Feel free to forward this by email to three of your friends.