What are the Advantages and disadvantages of export houses?

Answer 1

Export houses consist of Exporting managers, Export agents and Confirming houses.

Advantages

• All three are local middlemen
• They have experience in the foreign markets
• Has political & economic connections
• Merchants & Agents have specialist skills for counter trade
• manufacture does not bear the overhead cost of exporting

Disadvantages

• The producers has little or no control over his market
• The Goodwill created is the merchants and not the producers
• The contract is short term
• Agents push those products that sell and can neglect others
• manufacturer loose control if he relies too much on them
• Merchants and agents are best suited by short term contracts