Concentration is a unit of summary measures that connects proportion with numbers. Regardless of the knowledge on customer's risks of individuals with high accuracy degree or knowledge on the relationship between customers' risks a reduced concentration will lead to an overall reduction on the organizations credit risk exposure and its range of receivables thus increasing the firm's diversification
The management should be deeply concerned in overcoming initial pitfalls and in provision of the finances required in the export process. These he can do by closely monitoring the efforts towards international marketing.
The management should seek export guidance from qualified personnel which will assist them in developing a good marketing strategy prior to the start of the export business. The developed strategy should incorporate the export objectives plus expected 'negatives'.
The management should be extra cautious when selecting distributors from overseas. Best distributors are those who are very independent in their work. However, the international distributors should be given the same treatment as the domestic counterparts with much emphasis on orderly growth and profitable ventures.
The management should never hold assumptions that given product marketing techniques will obviously succeed in all countries i.e. what works in Israel may fail in Korea. It is therefore important for the management to treat each market separately in order to succeed.
Since each country has a different culture and therefore a different cultural preference the management should have the willingness to modify their products so as to meet the said differences.
The management should take advantage of economies of scale. This can be made possible through the enlargement of the overall sales base so as to spread the exports fixed costs.
The management might be required to divert its key personnel from the domestic responsibilities so as they can help in developing the company's export procedures.
The initial procedures and start-up decisions might end up consuming most of the company's precious time a thing that will slow its operations.
The whole excise might turn out to be very expensive since the sales promotion material, brochures and catalogues will be required to be translated in the many foreign languages involved in the exporting business. Together with these the company might need to add its plant facilities so as to cope with the now expanding market.
Export will definitely require additional funds because it is known to be a very expensive exercise which involves regular product modifications so as to meet the varying specifications of the foreign markets.
The management will be required to allow credit terms so as to keep pace with the highly competitive global market, the local customs authority and the travel arrangements.
Where transportation means are not available the company will make low sales. Also when the transportation costs are too high the company will be constrained on the amount to