#Leather bag wholesale market in delhi

[devonleather]

Leather Bags Manufacturers and Suppliers in Delhi – Quality Craftsmanship by Devon

Delhi has long been a hub for premium leather goods, attracting businesses and individuals looking for high-quality leather products. If you're searching for Leather Bags Manufacturers in Delhi or Leather Bags Suppliers in Delhi, look no further than Devon. With years of expertise, superior craftsmanship, and a commitment to excellence, Devon stands out as a leading name in the leather industry.

The Growing Demand for Leather Bags in Delhi

Leather bags have always been a symbol of sophistication and durability. Whether for business professionals, travelers, or fashion enthusiasts, the demand for high-quality leather bags continues to rise. Delhi, being a prominent commercial center, has established itself as a key player in the leather goods industry, housing some of the most skilled manufacturers and suppliers.

Devon – A Trusted Leather Bags Manufacturer in Delhi

As one of the most reputed Leather Bags Manufacturers in Delhi, Devon specializes in creating premium leather bags tailored to both local and international markets. Our wide range of products includes:

Luxury Handbags – Stylish and durable bags for fashion-conscious individuals.

Office & Laptop Bags – Elegant and sturdy designs for professionals.

Travel & Duffle Bags – Spacious and high-quality bags for travelers.

Messenger & Crossbody Bags – Functional and trendy bags for everyday use.

Backpacks & Tote Bags – Versatile designs suitable for work and casual wear.

Each bag is meticulously crafted using the finest materials to ensure longevity and aesthetic appeal.

Why Choose Devon as Your Leather Bags Supplier in Delhi?

Devon is not only a leading Leather Bags Manufacturer in Delhi but also a trusted Leather Bags Supplier in Delhi, providing high-quality products to wholesalers, retailers, and businesses worldwide. Here’s why Devon is the preferred choice:

1. Premium Quality Materials

We use genuine full-grain and top-grain leather that ensures durability and elegance.

2. Skilled Craftsmanship

Our leather artisans are highly experienced in creating exquisite and durable designs with perfect stitching and finishing.

3. Customization & Private Label Manufacturing

Businesses can customize leather bags with their brand logo, design specifications, and color choices.

4. Eco-Friendly & Ethical Manufacturing

Devon follows sustainable leather processing methods, ensuring minimal environmental impact.

5. Bulk Supply & Timely Delivery

As a reliable Leather Bags Supplier in Delhi, we fulfill bulk orders efficiently, ensuring prompt delivery across India and globally.

The Manufacturing Process at Devon

At Devon, every leather bag goes through a rigorous production process:

Material Selection – Premium leather is handpicked for quality assurance.

Design & Pattern Making – Expert designers create elegant and functional styles.

Cutting & Stitching – Precision cutting and stitching ensure durability.

Finishing & Quality Control – Every bag undergoes a thorough inspection for quality assurance.

Packaging & Shipping – The final products are securely packed and shipped to customers worldwide.

Conclusion

For businesses and individuals seeking Leather Bags Manufacturers in Delhi or Leather Bags Suppliers in Delhi, Devon is the ultimate destination. With our focus on quality, customization, and timely supply, we cater to diverse leather bag needs. Whether you need premium leather bags for your brand or personal use, Devon guarantees excellence in every piece.

Contact us today to explore our collection or place bulk orders!

Let me know if you need any refinements!

[panoramic-sourcing1]

Handmade Leather Goods USA | Panoramic Sourcing

In a world driven by mass production, the charm of handmade leather goods stands unparalleled. These products symbolize craftsmanship, quality, and exclusivity. For businesses in the USA seeking high-quality, handmade leather goods, Panoramic Sourcing is the ideal partner. Based in India, we specialize in connecting you with exceptional artisans who create bespoke leather products tailored to your needs.

Why Choose Handmade Leather Goods?

Handmade leather goods are synonymous with precision and care. Unlike machine-made products, handmade items reflect the skill and dedication of artisans. Each piece is unique, ensuring no two products are identical. This exclusivity makes handmade leather goods highly desirable among discerning customers.

From wallets and belts to luxury bags and footwear, handmade leather goods cater to a diverse range of preferences. These items are not just functional but also embody sophistication and timeless appeal. For USA businesses, offering handmade leather goods can help build a brand that stands out in a competitive market.

India: A Hub for Leather Craftsmanship

India has a rich heritage of leather craftsmanship. The country's skilled artisans combine traditional techniques with modern trends to create masterpieces. Panoramic Sourcing takes pride in sourcing leather goods from regions renowned for their craftsmanship, such as Kanpur, Kolkata, and Delhi.

Our network of artisans and manufacturers ensures that you receive products made from premium-quality leather. Whether you need minimalist designs or intricate patterns, Indian artisans excel in delivering exceptional results.

Panoramic Sourcing: Your Trusted Partner

At Panoramic Sourcing, we understand the nuances of the USA market and the importance of quality. Our handmade leather goods are curated to meet international standards, ensuring durability, elegance, and customer satisfaction.

What We Offer:

Custom Designs: We collaborate with artisans to create leather goods that align with your brand's identity. Share your vision, and we’ll bring it to life.

Diverse Product Range: From leather bags and wallets to aprons and laptop sleeves, our offerings cater to various industries and niches.

Ethical Sourcing: We prioritize sustainability and fair trade practices, supporting local communities and promoting eco-friendly production methods.

Quality Assurance: Every product undergoes stringent quality checks to ensure it meets your expectations.

Benefits of Partnering with Panoramic Sourcing

Access to Expertise: With years of experience in sourcing, we connect you with the best leather artisans in India.

Cost-Effective Solutions: Handmade leather goods from India offer excellent value for money, allowing you to maximize your profit margins.

Seamless Communication: Our team ensures clear and timely communication, making the sourcing process hassle-free.

Global Shipping: We facilitate efficient logistics to deliver your products to the USA without delays.

Elevate Your Brand with Handmade Leather Goods

By offering handmade leather goods, your business can tap into the growing demand for unique, high-quality products. Whether you’re a retailer, wholesaler, or designer, Panoramic Sourcing is here to fulfill your requirements.

Explore our collection of handmade leather goods and experience the blend of tradition and modernity. Let us help you create a brand that resonates with elegance and authenticity.

Contact Panoramic Sourcing today to discover how we can elevate your business with bespoke leather goods crafted by India’s finest artisans.

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Knitted Fabric Manufacturers - Response Fabrics • Knitted Fabric Manufacturers - Response Fabrics

Knitted Fabric Manufacturers

Response Fabric specializes in the export, sourcing, and marketing of knitted fabric manufacturers. We have been dealing in cotton fibers, cotton waste, cotton yarn, cotton knitted fabrics much more. The knitted fabric that is produced is flexible and can be readily fabricated into smaller parts. This makes it ideal for hosiery products such as socks, and hats. It is made from 100% cotton hosiery yarn by using circular knitting machines. 

Blended Knitted Fabric Latest Price in india

The price of the blended knitted fabric in India is starting from Rs. 480\kg, and more. 

Knitted Cotton Fabric Manufacturers & Suppliers in India

Response Fabrics counted among the top manufacturers & suppliers in India for knitted fabric. This offers a broad collection of Knitted Cotton fabric. This guarantee to use the selective, and essential material by our merchants. We have attained expertise in offering these products in creative styles, and designs to enhance the looks of the spaces. Designed using superior quality cotton & other fabrics in a multitude of colors, and shades, these products are sure to win the hearts of everyone. 

Knitted Fabric Manufacturers in Surat

For the best Manufacturer & Exporter of Designer Knitted Fabric Manufacturer in surat check the Response Fabrics that is the professional supplier of high quality Designer knitted Fabrics in Delhi. We specialized in supplying quality Fabrics, Leather, Synthetic Suede leather, which is widely used for automotive furniture sofa, footwear, fashion, gloves, sports, equipment, consumer electronics, etc. Response fabrics offer you all types of qualities in Leatherette, manufacturers offer you a wide range of artificial leather that can be used in offices, sofas, chairs, cinema halls, auditoriums, automobiles, jackets and so do we. The primary advantage of artificial leather is that it doesn’t get faded, doesn’t get easily cracked or wrinkled. 

Circular Knitted Fabric Manufacturers

This manufacturer of circular knitted fabrics offers the excellent quality of knitted fabrics. These circular knitted fabrics are mainly used for designed home furnishing items, carry bags, and many other things. These products are high on every feature like color, look, design, and finishing. We are having excellent task work, and world class production machinery that aids to manage the urgent order on time. These fabrics are ideal for designing handicrafts items, and home furnishing items. Thisoffers the best suited for making apparel, and accessories. 

Response Fabric feels love to bring your satisfied products as per your requirement! If you have made up your mind, it is time to start browning the pictures, and pick the best alternative that suits your choice, and need.

Knitted Pile Fabric Manufacturers

Response Fabric is one of the excellent & premium brands for Knitted Pile Fabric in India. Company has its own fabric weaving factory, and dyeing factory that allows it to control product quality to meet client’s requests. There is a vast stock capacity, we are able to provide fabric cut-length service, and ship out the fabrics in one day. Offering superior spill, and stain resistance coupled with remarkable performance, and durability, extra post-treatment brings you more than just high performing technical fabrics. 

Knitted Spandex Fabric Manufacturers

Response Fabrics is the one stop solution for all your wholesale requirements of Knitted Spandex Fabric, and more. We deal in a wide variety of fabrics focusing on timely delivery of your bulk requirements. We are the exclusive dealer in India. We offer short lead times in a wide variety of products ranging from Knitted Spandex Fabric, Upholstery Fabric, rexine, and much more. 

READ MORE...Best Fabric Manufacturers In India, Upholstery Fabrics

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Wholesale Clothing in India: A Treasure Trove for Thrifty Fashionistas

India, the land of vibrant colors and intricate textiles, isn’t just a tourist paradise; it’s a haven for wholesale clothing enthusiasts. Whether you’re a budding entrepreneur launching your boutique or a seasoned retailer looking to spruce up your inventory, India’s wholesale markets offer a kaleidoscope of styles, fabrics, and prices that will blow your mind. But navigating this vast ocean of garments can be overwhelming. This blog is your ultimate guide to wholesale clothing in India, unveiling hidden gems and established hubs across the country.

Wholesale Clothing Markets in India

1. Tirupur

Tirupur known as the “hosiery capital of India,” Tirupur is a one-stop shop for casual wear. T-shirts, sweaters, pajamas, and leggings are available at rock-bottom prices, making it a paradise for retailers catering to youth and activewear markets. The Gandhi Maidan Market and Nehru Market are the go-to places for bulk buying.

2. Delhi

The bustling capital city houses some of the biggest wholesale markets in India. Chandni Chowk, a labyrinthine network of lanes, is legendary for its silks, saris, and lehengas at unbelievably low prices. Karol Bagh market and Lajpat Rai Market cater to a contemporary crowd with trendy western wear and accessories. Delhi also boasts dedicated markets like Khari Baoli for woolen goods and Bhagirath Palace for fabrics.

3. Mumbai

The fashion capital of India, Mumbai, pulsates with a modern vibe. Crawford Market, a British-era architectural marvel, houses an eclectic mix of wholesalers, from ethnic kurtas to international brands. Hill Road in Bandra is a trendy haven for bohemian chic clothing, while Fashion Street in Dadar caters to budget-conscious shoppers. If you’re looking for high-end labels, head to Kala Ghoda or Fort areas.

4. Surat

The “textile city of India,” Surat, is a paradise for anyone seeking ethnic wear. From sarees woven with zari threads to intricately embroidered kurtis, Surat’s wholesale markets like Ghod Dod Road and Rander Road offer unparalleled variety and quality. You’ll also find a flourishing market for men’s wear, including shirts, jeans, and sherwanis.

5. Jaipur

The “pink city” isn’t just about palaces and forts; it’s a treasure trove for handloom textiles. Bapu Bazaar is a must-visit for block-printed fabrics, tie-dye sarees, and traditional Rajasthani attire. Johari Bazaar, nestled near Hawa Mahal, offers stunning jewelry and embellishments to complete your ethnic ensembles.

6. Bengaluru

The IT hub of India also boasts a thriving garment industry. Peenya Industrial Area houses numerous factories and wholesalers offering everything from formal wear to sportswear. Commercial Street and Brigade Road are popular with young crowds looking for trendy clothes and accessories.

7. Kolkata

The city of joy retains its old-world charm in its bustling wholesale markets. New Market, established in 1874, is a treasure trove for cotton kurtas, sarees, and leather goods. For western wear, head to Park Street or Gariahat Market. Don’t miss Hogg Market, a colonial-era landmark offering everything from spices to stationery to unique apparel finds.

Finally, Wholesale clothing in India is an adventure. It’s a journey through vibrant colors, intricate fabrics, and friendly haggling. So, pack your bags, brush up on your bargaining skills, and dive into the treasure trove of Indian fashion. Remember, the best deals are often hidden in the corners of bustling markets, waiting to be discovered by the adventurous bargain hunter!

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Top shopping places in Delhi

Delhi is considered to be one of the finest places to shop in. The various market places of Delhi have an outstanding collection of almost everything including clothes, accessories, footwear, cosmetics, and more, be it designer, local, or copies. They have such reasonable rates and even wholesale amount purchasers can have a good time shopping here. so, if you are in Delhi, then below are some of the top shopping places in Delhi which you cannot afford to miss. 1.Lajpat Nagar

Lajpat Nagar is one of the most popular shopping places in the city. It is quite popular for all kinds of garments including formal clothes, casual clothes, salwar, kameezes, and much more. However, there is quite a lot associated with it. The product that is sold here are of excellent quality and other products which are sold here include accessories, bags, footwear. Well, these are more than enough reasons to go out shopping to Lajpat Nagar for you.

Book Budget Hotels in Lajpat Nagar 2. Karol Bagh

Karol Bagh is one of the busiest and also considered to be one of the oldest shopping places in Delhi. They are quite popular for Indian garments in cotton and silk, bridal wear, cosmetic products, electronic items, books, shoes, and also gadgets. Some of the most important shopping areas in Karol Bagh include Ajmal Khan Road, Ghaffar Market, Arya Samaj Road, and Bank Street.

Book Budget Hotels in Karol Bagh 3. Tilak Nagar

Tilak Nagar is comprised of quite a lot of amazing market areas which includes Central Market which is the best to shop in. there is an amazing collection of furniture in Jail Road. You can also find cinema halls around here. there are a lot of food joints as well in the area. you can find a spectacular collection of timber and hardware shops here along with shops that sell Chura, Pagri, currency garland, Kangna, Lawan suit, and other bridal accessories and collection. 4. Rajouri Garden

Rajouri Garden is one of the best market areas in the city. The Nehru market is the best here. There are a lot of malls also in this area including City Square, Pacific Mall, TDI Paragon Mall, Shoppers Stop, and many more. From clothing to accessories, to food and to bags and footwear, you can find everything and anything in this market area.

Book Budget Hotels in Delhi near Rajouri Garden

5. Janpath Market

This market is quite in the buzz in the city for its collection of amazing paintings, leather products and articles, clothing, handicrafts, Indian artifacts, imitation jewellery, brassware, and much more. If you choose this destination, you will be able to find amazing products here. Well, do not forget to bargain, there is a lot of scope for that here. you can also find handicrafts from various countries especially the Tiber and this is why this market is also referred to as Tibetan Market.

Book Budget Hotels in Delhi, Near Janpath

With that said, do not miss out on these top shopping places in Delhi for these are the best in the city and you can fill your shopping cart in less expenditure in the mentioned areas. But Hold on, this is not it. Delhi has much more to offer to Shopaholics. Watch out the space for another list of shopping spots in Delhi.

Book Budget Hotels in Delhi

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Handicrafts and Gifts Fair 2019

Spring Fair 2019 – A Short Preview

The Indian Handicrafts and Gifts Fair February 2019 which is also known as the Spring Fair 2019 is Asia’s biggest exhibition of handicrafts and gifts from India. The Spring Fair 2019 is organised by Export Promotion Council for Handicrafts with 2,900 exhibitors at Indian Expo Centre & Mart, New Delhi, Greater Noida Express Way, Greater Noida from 18 to 22 February, 2019.

The Spring Fair 2019 is a boon for Indian handicrafts exporters and accessories exporters from India as it serves as a bridge between handicrafts manufacturers and international buyers. The fair not only accommodate international buyers but also host domestic retailers and potential franchisees.

The main objective of the Spring Fair 2019 is to open the gates of international market for domestic handicrafts manufacturers by exhibiting their products to international clients. The event will be graced by wholesalers, franchises, distributors, fashion designers and retailers who may offer a contract for the export of a particular product.

Types of Products Displayed

The Spring Fair 2019 will host products such as,

Furniture and Furniture Accessories.

Fashion Jewellery & Accessories.

House ware.

Bathroom Accessories.

Gifts & Decorative.

Christmas & Festive Decors.

Carpets & Rugs.

Garden Decorative.

Incense Sticks, Candles, and Aromatics.

Lamps & Lighting.

Home Textiles.

Leather Goods & Bags.

Natural Fibre and Eco-Friendly Products.

Educational Toys & Games.

What does Spring Fair 2019 Promise to Deliver?

Unlimited Range of Products

The visitors of the Spring Fair 2019 will get the opportunity to witness some of the best handicrafts made in India ranging from home furnishing, gifts & decors, house wares to fashion Jewellery & accessories and leather goods.

Unique Designs

Though all the above-mentioned types of products can be accessed anywhere in the world, the thing that makes the products showcased at the Spring Fair 2019 special are its unique design reflecting traditional Indian practices and lifestyle.

Artistic Touch

The products displayed by various exhibitors not only promise unique designs but also an artistic touch which is why Indian handicrafts have a special place in global market.

New Trends

The Spring Fair 2019 will be flooded with items designed by new-age designers especially in the fashion jewellery and accessories section with a potential to create new trends in the future.

Eco-Friendly Products

The Fair will have products that are eco-friendly and recyclable such as handicrafts made out of cane and bamboo.

Facilities Provided for Buyers

The biggest handicrafts buyers and sellers meet will provide its visitors with all the necessary facilities that include

Exchange Counter

The IHGF will have a foreign exchange counter by Thomas Cook within the fair premises.

Medical Aid

The fair has all the necessary medical aids and special arrangements for the physically challenged to make them feel comfortable.

Business Centres

A multi-functional business centre offering international telephone facilities, fax, courier, secretarial services, and photocopying will be within the reach of the visitors.

Restaurants and Free Shuttle

The Spring Fair features restaurants and offer free shuttle service for international clients from certain hotels. For more details visit epch.in.

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  Knitted Fabric Manufacturers - Response Fabrics

Knitted Fabric Manufacturers

Response Fabric specializes in the export, sourcing, and marketing of knitted fabric manufacturers. We have been dealing in cotton fibers, cotton waste, cotton yarn, cotton knitted fabrics much more. The knitted fabric that is produced is flexible and can be readily fabricated into smaller parts. This makes it ideal for hosiery products such as socks, and hats. It is made from 100% cotton hosiery yarn by using circular knitting machines. 

Blended Knitted Fabric Latest Price in india

The price of the blended knitted fabric in India is starting from Rs. 480\kg, and more. 

Knitted Cotton Fabric Manufacturers & Suppliers in India

Response Fabrics counted among the top manufacturers & suppliers in India for knitted fabric. This offers a broad collection of Knitted Cotton fabric. This guarantee to use the selective, and essential material by our merchants. We have attained expertise in offering these products in creative styles, and designs to enhance the looks of the spaces. Designed using superior quality cotton & other fabrics in a multitude of colors, and shades, these products are sure to win the hearts of everyone. 

Knitted Fabric Manufacturers in Surat

For the best Manufacturer & Exporter of Designer Knitted Fabric Manufacturer in surat check the Response Fabrics that is the professional supplier of high quality Designer knitted Fabrics in Delhi. We specialized in supplying quality Fabrics, Leather, Synthetic Suede leather, which is widely used for automotive furniture sofa, footwear, fashion, gloves, sports, equipment, consumer electronics, etc. Response fabrics offer you all types of qualities in Leatherette, manufacturers offer you a wide range of artificial leather that can be used in offices, sofas, chairs, cinema halls, auditoriums, automobiles, jackets and so do we. The primary advantage of artificial leather is that it doesn’t get faded, doesn’t get easily cracked or wrinkled. 

Circular Knitted Fabric Manufacturers

This manufacturer of circular knitted fabrics offers the excellent quality of knitted fabrics. These circular knitted fabrics are mainly used for designed home furnishing items, carry bags, and many other things. These products are high on every feature like color, look, design, and finishing. We are having excellent task work, and world class production machinery that aids to manage the urgent order on time. These fabrics are ideal for designing handicrafts items, and home furnishing items. Thisoffers the best suited for making apparel, and accessories. 

Response Fabric feels love to bring your satisfied products as per your requirement! If you have made up your mind, it is time to start browning the pictures, and pick the best alternative that suits your choice, and need.

Knitted Pile Fabric Manufacturers

Response Fabric is one of the excellent & premium brands for Knitted Pile Fabric in India. Company has its own fabric weaving factory, and dyeing factory that allows it to control product quality to meet client’s requests. There is a vast stock capacity, we are able to provide fabric cut-length service, and ship out the fabrics in one day. Offering superior spill, and stain resistance coupled with remarkable performance, and durability, extra post-treatment brings you more than just high performing technical fabrics. 

Knitted Spandex Fabric Manufacturers

Response Fabrics is the one stop solution for all your wholesale requirements of Knitted Spandex Fabric, and more. We deal in a wide variety of fabrics focusing on timely delivery of your bulk requirements. We are the exclusive dealer in India. We offer short lead times in a wide variety of products ranging from Knitted Spandex Fabric, Upholstery Fabric, rexine, and much more. 

READ MORE...Fabric Manufacturers In India - Response Fabrics

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ARAVIND – 09901366442 – 09902787224

  Export Management

  ATTEMPT ONLY FOUR CASE STUDY

 CASE – 1

 Ms. Nilima and Ms. Sonia are very good friends. After completing their graduation in literature from a reputed college in Delhi University, they got a chance in modeling. This aroused their interest in the fashion industry. They decided to join a fashion institute to acquire proficiency in the field of designing of the ready made garments and completed two year course in designing. They have been working in the fashion industry for the last 3 years. Recently, they had been to USA in connection with a fashion show organised by one of their clients. They found that there is a lot of potential for the export of ready made garments to USA and other West European countries from India. They are now motivated to start their own export business in the field of ready made garments particularly women’s designer wear. They are willing to invest Rs. 5 lakhs each and have strong financial support to invest more money as well. As far as product is concerned, they have sufficient knowledge of fabrics, designs, accessories, dyeing, printing and fabrication processes. Ms. Sonia has also completed her MBA in International marketing from a reputed institute in Delhi. They have decided to establish their export business but do not know about the formalities involved in the establishment of their export business. They have approached you as a consultant in foreign trade for guidance.

 Question:

You are required to prepare a detailed report for their guidance so that they can establish their export business.

    CASE – 2

 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.

         CASE – 3

:

·      Product: Gents Shirts

·      Production Capacity installed: 4000 Shirts per month

·      Present capacity utilization: 2000 Shirts per month

·      Break-even level: 1400 Shirts per month

·      Fixed Costs: INR. 140,000/- per month

·      Variable Cost per shirt: INR 400 (or USD 10)

·      Selling Price / FOB Ex- New Delhi INR 500 (or USD 12.5)

          (This is based on average rate of exchange of 1 USD = INR 40)

          Duty drawback rate; 15% of FOB Value (Assumed for easy calculations)

             M/S Vivek International has received an enquiry for the supply of 1600 Shirts per month for the next one year to an importer in New York, U.S.A. But the initial talks with the importer have revealed that he would not be willing to pay USD 12.5 per shirt. He is quite inclined to pay much lower price. Since, this order would help increase capacity utilization, the economies of scale would reduce the variable cost in rupee terms by 10%. M/S Vivek International has decided to take this order.

 Question:

 You are requested to prepare a decision analysis to suggest the range of FOB prices (the minimum and the maximum) for negotiation of price with the importer. It may also be noted that the INR may weaken to a level of USD = INR 46 over the period of supply.

  CASE – 4 ON EXPORT PROMOTION

             Mr. Ram Kumar of M/S Khanna Road Carriers, New Delhi has recently ventured into export trade under the name and style of the firm called Exclusive Creations. He studied a few market reports and then decided to take up wooden handicrafts. He contacted European Business Information Centre, New Delhi and could get a few trade enquiries for the export of wooden handicrafts.

           He got a positive response from M/S Arts’N Wood in Germany. This buyer is a wholesaler-importer of Orient gift items, and accessories, with warehouse in Frankfurt and also in Sydney, Australia. After a initial round of correspondence with Mr. Joe Branke, of M/S Arts’N Wood, Mr. Branke showed his interest in wooden boxes with brass inlay of animal motifs. Mr. Kumar quoted a price of US$ 5 F.O.B. Ex- New Delhi per box. In view of the current demand trends in the market, Mr. Branke asked for a sample. He approved the sample with minor changes and initially placed a token order worth US$ 5000 for the supply of 1000 pieces on 5th October, 1999 to Mr. Kumar of the Exclusive Creations. Mr. Branke has assured Mr. Kumar that they could look forward to larger volumes of business in future, depending upon the present order. Mr. Kumar had taken the sample from a supplier in Nagina, Distt. Bijnore (UP) and was assured of its supply.

           The main features of this sample order were as follows:

(i)                 Product description & specification               :  Square wooden boxes (10” x 10”) with                                         brass inlay and of animal motifs.

(ii)               Quantity                                                          :  1000 Pcs.

(iii)             Rate and Amount                                           :   US$ 5.00 F.O.B. Ex- New                                                             Delhi Amt. $ 5000.

(iv)             Terms of Payment                                           :   US$ 2500 along with order                                                             and rest on D/P basis.

(v)               Delivery                                                          :   Goods to be consigned on or                                                             before 20th October, 1999                                                             to their warehouse in Australia.

Mr. Ram Kumar faxed a confirmation of order to Mr. Branke on October 6, 1999. He also placed order with his supplier same day for supply-by October 17, 1999.

Mr. Kumar could send the shipment on Nov. 1, 1999 since he got supply of wooden boxes on 25th October, 1999, and then the supply of card boxes for packing was also delayed due to workers strike.

Mr. Kumar sent a fax to Mr. Branke on Nov. 10, conveying his thanks for the remaining payment of US$ 2500 and expressed the hope that this sample shipment sent by him would be the beginning of their long term mutually beneficial relationship.

Mr. Kumar was, however, taken aback on receiving a fax dated November 12, 1999 from Mr. Branke in which he had stated that the wooden boxes were not as per approved sample. Mr. Branke stated that the carvings on the boxes did not have the same finish as per sample and that the brass inlays were chipped from various places, in addition to their blackening. He expressed his unhappiness over the manner in which the shipment was sent. He also referred to hold-up of the shipment by the customs authorities in Sydney as it was not fumigated as required under the Australian laws. The shipment was quarantined at the customs and as a result, Mr. Branke had to pay $300 on account of fumigation tax and warehouse charges. he had to travel 200 kms away from Sydney to get the goods fumigated. As a result of this delay, Mr. Branke lost out on some good orders.  

Mr. Branke did not touch the subject of future business with Mr.

Ram Kumar of the Exclusive Creations in his fax dated November 12, 1999.

Mr. Ram Kumar sent another Fax on November 13, 1999 explaining his position but could not elicit any response from Mr. Branke. Mr. Kumar followed it up but he drew blank.

This development was a serious set back to the efforts of Mr. Ram Kumar as he had planned to penetrate the German/Australian Market in a big way. He wants to control the situation. He has thought of a business trip to Sydney to win back the confidence of Mr. Branke and also look for opportunities for promotion of his product in the Australian Market to make a serious beginning in business.

Mr. Ram Kumar has approached you to help him. He is seeking your assistance in regard to the following questions:

(i)                 How to analyse the situation and what is real problem(s) being faced by him?

(ii)               What steps should he take to deal with this situation, in view of the fact that the items selected for exports have potential market?

(iii)             How should he plan to further promote his item(s) in the German / Australian Market?

  CASE – 5

 Mr. Rohit Gupta and Mr. Vikas Khanna decided to enter into partnership to start the business of exporting leather goods (hand bags, belts, purses, wallets etc.) they entered into partnership agreement on January 1, 1997 and signed the partnership deal on the same. They agreed to name the firm as R V International located at B-225, Sarita Vihar, New Delhi. They also agreed to contribute Rs. 75,000/- each towards the initial capital of the firm. A bank account was opened by them with Bank India, Barakhamba Road, New Delhi. On January 1, 1997 (Current Account No. 01256) with an initial deposit of Rs. 70,000/- M/S R V International applied for the grant of Importer – Exporter Code (IEC) No. the Joint DGFT, Asaf Ali Road, New Delhi on January 2, 1997. (The IEC No. 5005217 was allotted to the firm on 25 January, 1997 was as follows:

 Balance Sheet as on 1.1.1997

Liabilities

Amount

Assets

Amount

Capital A/cs

Rohit Gupta

Vikas Khanna

Rs.

75,000

75,000

 Cash in hand

Cash at Bank

Bank of India

Rs.

80,000

70,000

 1,50,000

 1,50,000

             Mr. Rohit Gupta approached Trade Information Centre, New Delhi for guidance to get some order. Following the advice, Mr. Rohit Gupta could get an order on February 25, 1997 from M/S Lionel Trains Inc. 50526. R.W. Boulevard Chesterfield Michigan, U.S.A. for the supply of 1500 leather bags (Design: RV 1021) for USD 15000 F.O.B. Ex- New Delhi. It was agreed that M/S Lionel Trains Inc. shall pay USD 2,000 as advance and the remaining USD 13000 on D/P basis. The shipment was agreed to be sent on or before May 31, 1997. The demand draft for USD 2000 issued by importer’s Bank (Bank of America, Chesterfield Michigan) was received on March 2, 1997.

           Mr. Vikas Khanna took up the responsibility for the execution of this order. He identified the following firms for supply of hand bags and packaging/packing materials. The agreed terms and conditions are:

For Supply of hand bags:                                            :   M/s Creation Impex,

                                                                                 A042, Sector 19, NOIDA UP

Total Qty                                                                   :   1550 Nos.

Supply by                                                                    :   May 05, 1997

Total Amount                                                              :   Rs. 271,250

Advance payment                                                       :   Rs. 1,50,000

Balance of delivery

 For Supply of Packaging/PackingMaterial                 :   M/S Ashima Finishers

                                                                                   :   D-126, Naraina Indl.Area,

                                                                                   :   N.Delhi

Total Amount                                                              :   Rs. 37,800

Advance Payment                                                       :   Rs. 17,000

Balance on delivery

Supply by                                                                    :   May 05, 1997

 The costing details and statement of fixed expenses are as follows:

Cost details for one Leather hand bag                        :

Variable Expenses                                                       :   $

Purchase Price                                                             :   5.00

Office Overhead                                                         :   0.50

Packaging/Packing                                                     :   0.72

Documentation and Agent Fee                                   :   0.03

ECGC Shipment                                                         :

(Comprehensive Risks) Policy Insurance

Premium                                                                      :   0.05

FOB/Cash Cost per bag                                              :   $6.30   INR 220.50

FOB Price Ex- New Delhi                                          :   $10.00 INR 350.00

Margin                                                                         :   $3.70   INR 129.50

(Rate of Exchange)                                                     :   USD = INR 35)

 Fixed expenses per Month

Rent                                                                            :   Rs. 10,000

Salaries                                                                        :   Rs. 13,500

Telephone/Electricity, Rentals                                    :   Rs.   800

Total                                                                            :   Rs. 24,300

 The Balance Sheet and Profit and Loss Account of M/S R V International, as on 28.12.1997 are as follows:

   R.V. International

Profit & Loss A/c for the period 1.1.1997 to 28.2.1997

 Particulars

Rs.

Particulars

Rs.

Printing Expenses

Stationery

Fee for IEC No.

Liaison  Expenses

Rent

Salaries to  staff

Telephone Bill  of Exchange

Electricity  Bill

Payment to  Couriers

Payment to  Consultant

Free Sample

Interest  Accrued:

Loans from Ravi  Khanna

Loan from XYZ  Finance

Office Expenses

   1,500

 1,500

 1,000

 1,500

10,000

13,500

 3,000

 1,600

    900

 5,000

35,000

   1,300

    800

 4,000

By Net  operating loss

80,600

80,600

80,600

 R.V. International

Balance Sheet as on 28.2.1997

 Liabilities

Rs.

Assets

Rs.

Capital A/cs

Rohit Gupta

Vikas Khanna

13% Unsecured  loan from

Mr. Ravi

17% Secured  Loan from

XYZ Fin.Co.

Accrued

Ravi Khanna Rs.  1300

XYZ Finance Co.  800

 Total

    75,000

  75,000

 1,30,000

    70,000

        2100

Cash in Hand

Cash at Bank

Bank of India

Furniture &  Furnishings

Computer

Inventories

 Net operating  loss

    6,500

  30,000

 1,40,000

  50,000

  45,000

    80,000

3,52,100

3,52,100

M/S R V International do not have sufficient funds to execute this order.

 Mr. Vikas Khanna would like to apply for pre-shipment finance (packing credit). He is not sure whether he would be able to obtain the funds from the bank. He seeks you advice in this matter.

   CASE – 6    EXECUTION OF EXPORT ORDER

          You are given below the purchase order placed by M/s R.S. Office Products from Germany with M/s Viraz Global Exporters, Saket, New Delhi, the exporter from India. The payment terms stipulated in the order relate to payment by means of irrevocable letter of credit. The order and the letter of credit are given below. You are appointed as the team leader for the execution of this order by the managing partner of the export firm for the execution of this order.

                                                  PURCHASE ORDER

Order Placed by                            : R.S. OFFICE PRODUCTS GmbH

                                                       MAX PLANK-STRASSE 13

                                                        D-68519 BERLIN GERMANY

Order No.                                      : 48588

Date                                                   : 26.08.96

Supplier                                        : VIRAJ GLOBAL EXPORTERS

                                                       H-53, C, SAKET

                                                       NEW DELHI 110 017

Article Description                        : OVERALL

Article details / materials              : 100% Boumolle, 40’s Cambric (40x40/92x80)

Colour / Print                                : Blue / Printed Marigold Binding band at back

                                                       In Colour 200 pcs

          Size                                         Quantity in Pcs Unit          Price in DEM

         98                                                       20                                   40.00

        104                                                      20                                   40.00

        116                                                      40                                   40.00

        128                                                      60                                   40.00

        140                                                      60                                   40.00

 Delivery Date                                :  30.10.96

Packing Instruction                       :  Shipment in standard cartons with polybags

                                                        single piece packing according to our shipping

                                                        instructions.

Total Amount                                :  DM 8000.00

Export Licence category               :  78 (Non-Restrained)

Terms of Payment                         :  L/C

Mode of transport                         :  Air

Destination                                   :  Berlin

Further agreements                       :  Polybag / Normacarton N4, 60 x 40 x 40 cm

          The supplier has to pay a fine if the stipulated delivery dates are not met, no matter whether he caused the delay or not. The fine amounts to 0.5% per calendar day, however not more than 20% of the total remuneration agreed. We can insists on the fine until final account has been done, even if we don not expressly reserve the right thereto on accepting the late delivery.

   Special Regulations

          The supplier assures that the goods are in compliance with the amendment degree of the ordinance on consumer articles (the respective version valid) and undertakes to bear the consequential damages which may result from any non-observance.

        Production can only be started after our Quality Control Department did release size set, sample and test-material.

        The waste management charges for the specially agreed transport packaging are 0.7% and sales packaging has to be marked with the “Green Dot”.

        The contract is subject to German law, proper venue is Frankfurt/ Main.  

 DOCUMENTARY CREDIT

 DESTINATION        SYNBINBBAXXX   SW 1996083OFS0000004200

SESS  2355                                                 DATE RECD 30-Aug-96-9:07

 ORIGINATOR          DEUTSCHE BANK  FROM SWIFT

SESS 2024                       BERLIN               DATE Sent 29-Aug-96

 27 / Sequence of Total Pages                       :   1 / 2

46A / Form of documentary credit              :   Irrevocable / Transferable

26 / Documentary credit number                 :   1261A3956

31C / Date of issue                                    :   96/08/29

31D/ Date and place of expiry                     :   96/11/20 BERLIN, Germany

51A/ Applicant bank                                    :   DEUTSCHE BANK

                                                                    BERLIN, Germany

51B / Advising bank                                    :   SYNDICATE BANK

                                                                   SAKET NEW DELHI, India

50 / Applicant                                              :   R.S. OFFICE PRODUCTS GmbH

                                                                   MAX PLANK – STRASSE 13

                                                                   D-68519 BERLIN, Germany

59 / Beneficiary                                           :   VIRAJ GLOBAL ENTERPRISES

                                                                  H-53 C, SAKET

                                                                  NEW DELHI 110017

320 / Currency code amount                        :   DEM 7944.00

41A / Available with/by-swift addr             :   DEUTCHE BANK

                                                                   BERLIN, Germany

                                                                  By payment

43p / Partial shipment                                  :   ALLOWED BUT ONLY

                                                                    COMPLETED ARTICLE GROUPS

43t / Transhipment                                     :   ALLOWED

44A/ON board/disp/taking charge               :   INDIAN AIRPORT

44B/For transportation to                            :  BERLIN, Germany

44C/Latest date of shipment                       :  96 /10 / 30

45A/Descr goods and/ or services               :  Goods (Girl’s Overall) as per

                                                                  purchase order no.48588 dated

                                                                  26.8.96

        6130004858 DM 8,000,00 GSP Form ‘A’ by air

      Less 0.7 percent (ENVIRONMENT BONUS)

      L/C Amount DEM 7.944,00

        FOB INIDAN AIRPORT OR

        CFR BERLIN AIRPORT

        (SEE ADDTITIONAL CONDITIONS)

46A/document required                               :  See MT 701

27/Sequence of Total Pages                         :  2 / 2

20/documentary credit number                    :  L261A3956

47A / additional conditions                         :

_____________________________________________________________

 ·      If the shipment is delayed for more than 14 days, Terms of shipment must change from FOB Indian Airport to Airfreight CFR Berlin

·      A discrepancy fee of DEM 120.00 and Telex/Swift charges, if any, will be deducted from the proceeds if documents are presented with discrepancy and acceptance of such documents does not in any way alter the terms and conditions of this credit. 46B/ document required – MT 701

·      Signed commercial invoice, original + 5 copies stamped and signed by SGS (India) Ltd., stating L.C. No. and purchase order no.

·      Copy of export cert. showing Germany as importing country, consigned to R.S. office products Gmbh, D-68519, Berlin, Germany.  

·      GSP certificate Form ‘A’ issued or certified by A Chamber of Commerce or any equal public authority consigned to R.S. office products GmbH, D-68519, Berlin, Germany.

·      Inspection certificate issued by SGS (India) Ltd. and signed by authorised representative.

·      In case of airfreight, master airway bill (MAWB) indicating exact Flight No. + date, consigned to applicant, marked freight collect, Ist notify: Applicant 2nd notify: wellmann, nuernberg, evidencing that beneficiary’s certificate, one copy of invoice and packing list are accompanying the goods. AWB to b issued by concord logistics (India) pvt. Ltd., negotiable.

·      In case of Sea-Air freight, comb, transport doc, consigned to applicant, marked, freight collect, 1st notify: applicant, 2nd notify: Hellmann Nufrnberg, evidencing that one copy of invoice and packing list are accompanying the goods.

  LB charges                                                     All commissions and charges in your

                                                                     country are beneficiary’s account

48/ period of presentation                              10 days after the date of issuance of

                                                                      the shipping docs but within credit’s

                                                                      validity.

 49/ confirmation instruction                          without

78/ instruction to pay/acc/

Vie bk                                                            Pls send all docs in one lot by courier

  TO DEUTSCHE BANK, BERLIN, GERMANY

  57D/ advise thru bank-amme add                   Your New Delhi Saket Branch

                                                                       (Syndicate Bank)

72/ Sender to receiver information                 Reimbursement:

                                                                       After Receipt L/C conform we shall

                                                                       remit proceeds.

  Question:

          As a team leader, you are required to prepare a detailed plan for the implementation of this order to ensure the shipment is sent in time.

  Assignment Solutions, Case study Answer sheets

Project Report and Thesis - Contact

aravind.banakar@gmail.com

www.mbacasestudyanswers.com

ARAVIND – 09901366442 – 09902787224

  dy> ����@�r

[homestudyhelp365-blog]

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

Assignment Solutions, Case study Answer sheets

Project Report and Thesis - Contact

aravind.banakar@gmail.com

www.mbacasestudyanswers.com

ARAVIND – 09901366442 – 09902787224

  Export Management

  ATTEMPT ONLY FOUR CASE STUDY

 CASE – 1

 Ms. Nilima and Ms. Sonia are very good friends. After completing their graduation in literature from a reputed college in Delhi University, they got a chance in modeling. This aroused their interest in the fashion industry. They decided to join a fashion institute to acquire proficiency in the field of designing of the ready made garments and completed two year course in designing. They have been working in the fashion industry for the last 3 years. Recently, they had been to USA in connection with a fashion show organised by one of their clients. They found that there is a lot of potential for the export of ready made garments to USA and other West European countries from India. They are now motivated to start their own export business in the field of ready made garments particularly women’s designer wear. They are willing to invest Rs. 5 lakhs each and have strong financial support to invest more money as well. As far as product is concerned, they have sufficient knowledge of fabrics, designs, accessories, dyeing, printing and fabrication processes. Ms. Sonia has also completed her MBA in International marketing from a reputed institute in Delhi. They have decided to establish their export business but do not know about the formalities involved in the establishment of their export business. They have approached you as a consultant in foreign trade for guidance.

 Question:

You are required to prepare a detailed report for their guidance so that they can establish their export business.

    CASE – 2

 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.

         CASE – 3

:

·      Product: Gents Shirts

·      Production Capacity installed: 4000 Shirts per month

·      Present capacity utilization: 2000 Shirts per month

·      Break-even level: 1400 Shirts per month

·      Fixed Costs: INR. 140,000/- per month

·      Variable Cost per shirt: INR 400 (or USD 10)

·      Selling Price / FOB Ex- New Delhi INR 500 (or USD 12.5)

          (This is based on average rate of exchange of 1 USD = INR 40)

          Duty drawback rate; 15% of FOB Value (Assumed for easy calculations)

             M/S Vivek International has received an enquiry for the supply of 1600 Shirts per month for the next one year to an importer in New York, U.S.A. But the initial talks with the importer have revealed that he would not be willing to pay USD 12.5 per shirt. He is quite inclined to pay much lower price. Since, this order would help increase capacity utilization, the economies of scale would reduce the variable cost in rupee terms by 10%. M/S Vivek International has decided to take this order.

 Question:

 You are requested to prepare a decision analysis to suggest the range of FOB prices (the minimum and the maximum) for negotiation of price with the importer. It may also be noted that the INR may weaken to a level of USD = INR 46 over the period of supply.

  CASE – 4 ON EXPORT PROMOTION

             Mr. Ram Kumar of M/S Khanna Road Carriers, New Delhi has recently ventured into export trade under the name and style of the firm called Exclusive Creations. He studied a few market reports and then decided to take up wooden handicrafts. He contacted European Business Information Centre, New Delhi and could get a few trade enquiries for the export of wooden handicrafts.

           He got a positive response from M/S Arts’N Wood in Germany. This buyer is a wholesaler-importer of Orient gift items, and accessories, with warehouse in Frankfurt and also in Sydney, Australia. After a initial round of correspondence with Mr. Joe Branke, of M/S Arts’N Wood, Mr. Branke showed his interest in wooden boxes with brass inlay of animal motifs. Mr. Kumar quoted a price of US$ 5 F.O.B. Ex- New Delhi per box. In view of the current demand trends in the market, Mr. Branke asked for a sample. He approved the sample with minor changes and initially placed a token order worth US$ 5000 for the supply of 1000 pieces on 5th October, 1999 to Mr. Kumar of the Exclusive Creations. Mr. Branke has assured Mr. Kumar that they could look forward to larger volumes of business in future, depending upon the present order. Mr. Kumar had taken the sample from a supplier in Nagina, Distt. Bijnore (UP) and was assured of its supply.

           The main features of this sample order were as follows:

(i)                 Product description & specification               :  Square wooden boxes (10” x 10”) with                                         brass inlay and of animal motifs.

(ii)               Quantity                                                          :  1000 Pcs.

(iii)             Rate and Amount                                           :   US$ 5.00 F.O.B. Ex- New                                                             Delhi Amt. $ 5000.

(iv)             Terms of Payment                                           :   US$ 2500 along with order                                                             and rest on D/P basis.

(v)               Delivery                                                          :   Goods to be consigned on or                                                             before 20th October, 1999                                                             to their warehouse in Australia.

Mr. Ram Kumar faxed a confirmation of order to Mr. Branke on October 6, 1999. He also placed order with his supplier same day for supply-by October 17, 1999.

Mr. Kumar could send the shipment on Nov. 1, 1999 since he got supply of wooden boxes on 25th October, 1999, and then the supply of card boxes for packing was also delayed due to workers strike.

Mr. Kumar sent a fax to Mr. Branke on Nov. 10, conveying his thanks for the remaining payment of US$ 2500 and expressed the hope that this sample shipment sent by him would be the beginning of their long term mutually beneficial relationship.

Mr. Kumar was, however, taken aback on receiving a fax dated November 12, 1999 from Mr. Branke in which he had stated that the wooden boxes were not as per approved sample. Mr. Branke stated that the carvings on the boxes did not have the same finish as per sample and that the brass inlays were chipped from various places, in addition to their blackening. He expressed his unhappiness over the manner in which the shipment was sent. He also referred to hold-up of the shipment by the customs authorities in Sydney as it was not fumigated as required under the Australian laws. The shipment was quarantined at the customs and as a result, Mr. Branke had to pay $300 on account of fumigation tax and warehouse charges. he had to travel 200 kms away from Sydney to get the goods fumigated. As a result of this delay, Mr. Branke lost out on some good orders.  

Mr. Branke did not touch the subject of future business with Mr.

Ram Kumar of the Exclusive Creations in his fax dated November 12, 1999.

Mr. Ram Kumar sent another Fax on November 13, 1999 explaining his position but could not elicit any response from Mr. Branke. Mr. Kumar followed it up but he drew blank.

This development was a serious set back to the efforts of Mr. Ram Kumar as he had planned to penetrate the German/Australian Market in a big way. He wants to control the situation. He has thought of a business trip to Sydney to win back the confidence of Mr. Branke and also look for opportunities for promotion of his product in the Australian Market to make a serious beginning in business.

Mr. Ram Kumar has approached you to help him. He is seeking your assistance in regard to the following questions:

(i)                 How to analyse the situation and what is real problem(s) being faced by him?

(ii)               What steps should he take to deal with this situation, in view of the fact that the items selected for exports have potential market?

(iii)             How should he plan to further promote his item(s) in the German / Australian Market?

  CASE – 5

 Mr. Rohit Gupta and Mr. Vikas Khanna decided to enter into partnership to start the business of exporting leather goods (hand bags, belts, purses, wallets etc.) they entered into partnership agreement on January 1, 1997 and signed the partnership deal on the same. They agreed to name the firm as R V International located at B-225, Sarita Vihar, New Delhi. They also agreed to contribute Rs. 75,000/- each towards the initial capital of the firm. A bank account was opened by them with Bank India, Barakhamba Road, New Delhi. On January 1, 1997 (Current Account No. 01256) with an initial deposit of Rs. 70,000/- M/S R V International applied for the grant of Importer – Exporter Code (IEC) No. the Joint DGFT, Asaf Ali Road, New Delhi on January 2, 1997. (The IEC No. 5005217 was allotted to the firm on 25 January, 1997 was as follows:

 Balance Sheet as on 1.1.1997

Liabilities

Amount

Assets

Amount

Capital A/cs

Rohit Gupta

Vikas Khanna

Rs.

75,000

75,000

 Cash in hand

Cash at Bank

Bank of India

Rs.

80,000

70,000

 1,50,000

 1,50,000

             Mr. Rohit Gupta approached Trade Information Centre, New Delhi for guidance to get some order. Following the advice, Mr. Rohit Gupta could get an order on February 25, 1997 from M/S Lionel Trains Inc. 50526. R.W. Boulevard Chesterfield Michigan, U.S.A. for the supply of 1500 leather bags (Design: RV 1021) for USD 15000 F.O.B. Ex- New Delhi. It was agreed that M/S Lionel Trains Inc. shall pay USD 2,000 as advance and the remaining USD 13000 on D/P basis. The shipment was agreed to be sent on or before May 31, 1997. The demand draft for USD 2000 issued by importer’s Bank (Bank of America, Chesterfield Michigan) was received on March 2, 1997.

           Mr. Vikas Khanna took up the responsibility for the execution of this order. He identified the following firms for supply of hand bags and packaging/packing materials. The agreed terms and conditions are:

For Supply of hand bags:                                            :   M/s Creation Impex,

                                                                                 A042, Sector 19, NOIDA UP

Total Qty                                                                   :   1550 Nos.

Supply by                                                                    :   May 05, 1997

Total Amount                                                              :   Rs. 271,250

Advance payment                                                       :   Rs. 1,50,000

Balance of delivery

 For Supply of Packaging/PackingMaterial                 :   M/S Ashima Finishers

                                                                                   :   D-126, Naraina Indl.Area,

                                                                                   :   N.Delhi

Total Amount                                                              :   Rs. 37,800

Advance Payment                                                       :   Rs. 17,000

Balance on delivery

Supply by                                                                    :   May 05, 1997

 The costing details and statement of fixed expenses are as follows:

Cost details for one Leather hand bag                        :

Variable Expenses                                                       :   $

Purchase Price                                                             :   5.00

Office Overhead                                                         :   0.50

Packaging/Packing                                                     :   0.72

Documentation and Agent Fee                                   :   0.03

ECGC Shipment                                                         :

(Comprehensive Risks) Policy Insurance

Premium                                                                      :   0.05

FOB/Cash Cost per bag                                              :   $6.30   INR 220.50

FOB Price Ex- New Delhi                                          :   $10.00 INR 350.00

Margin                                                                         :   $3.70   INR 129.50

(Rate of Exchange)                                                     :   USD = INR 35)

 Fixed expenses per Month

Rent                                                                            :   Rs. 10,000

Salaries                                                                        :   Rs. 13,500

Telephone/Electricity, Rentals                                    :   Rs.   800

Total                                                                            :   Rs. 24,300

 The Balance Sheet and Profit and Loss Account of M/S R V International, as on 28.12.1997 are as follows:

   R.V. International

Profit & Loss A/c for the period 1.1.1997 to 28.2.1997

 Particulars

Rs.

Particulars

Rs.

Printing Expenses

Stationery

Fee for IEC No.

Liaison  Expenses

Rent

Salaries to  staff

Telephone Bill  of Exchange

Electricity  Bill

Payment to  Couriers

Payment to  Consultant

Free Sample

Interest  Accrued:

Loans from Ravi  Khanna

Loan from XYZ  Finance

Office Expenses

   1,500

 1,500

 1,000

 1,500

10,000

13,500

 3,000

 1,600

    900

 5,000

35,000

   1,300

    800

 4,000

By Net  operating loss

80,600

80,600

80,600

 R.V. International

Balance Sheet as on 28.2.1997

 Liabilities

Rs.

Assets

Rs.

Capital A/cs

Rohit Gupta

Vikas Khanna

13% Unsecured  loan from

Mr. Ravi

17% Secured  Loan from

XYZ Fin.Co.

Accrued

Ravi Khanna Rs.  1300

XYZ Finance Co.  800

 Total

    75,000

  75,000

 1,30,000

    70,000

        2100

Cash in Hand

Cash at Bank

Bank of India

Furniture &  Furnishings

Computer

Inventories

 Net operating  loss

    6,500

  30,000

 1,40,000

  50,000

  45,000

    80,000

3,52,100

3,52,100

M/S R V International do not have sufficient funds to execute this order.

 Mr. Vikas Khanna would like to apply for pre-shipment finance (packing credit). He is not sure whether he would be able to obtain the funds from the bank. He seeks you advice in this matter.

   CASE – 6    EXECUTION OF EXPORT ORDER

          You are given below the purchase order placed by M/s R.S. Office Products from Germany with M/s Viraz Global Exporters, Saket, New Delhi, the exporter from India. The payment terms stipulated in the order relate to payment by means of irrevocable letter of credit. The order and the letter of credit are given below. You are appointed as the team leader for the execution of this order by the managing partner of the export firm for the execution of this order.

                                                  PURCHASE ORDER

Order Placed by                            : R.S. OFFICE PRODUCTS GmbH

                                                       MAX PLANK-STRASSE 13

                                                        D-68519 BERLIN GERMANY

Order No.                                      : 48588

Date                                                   : 26.08.96

Supplier                                        : VIRAJ GLOBAL EXPORTERS

                                                       H-53, C, SAKET

                                                       NEW DELHI 110 017

Article Description                        : OVERALL

Article details / materials              : 100% Boumolle, 40’s Cambric (40x40/92x80)

Colour / Print                                : Blue / Printed Marigold Binding band at back

                                                       In Colour 200 pcs

          Size                                         Quantity in Pcs Unit          Price in DEM

         98                                                       20                                   40.00

        104                                                      20                                   40.00

        116                                                      40                                   40.00

        128                                                      60                                   40.00

        140                                                      60                                   40.00

 Delivery Date                                :  30.10.96

Packing Instruction                       :  Shipment in standard cartons with polybags

                                                        single piece packing according to our shipping

                                                        instructions.

Total Amount                                :  DM 8000.00

Export Licence category               :  78 (Non-Restrained)

Terms of Payment                         :  L/C

Mode of transport                         :  Air

Destination                                   :  Berlin

Further agreements                       :  Polybag / Normacarton N4, 60 x 40 x 40 cm

          The supplier has to pay a fine if the stipulated delivery dates are not met, no matter whether he caused the delay or not. The fine amounts to 0.5% per calendar day, however not more than 20% of the total remuneration agreed. We can insists on the fine until final account has been done, even if we don not expressly reserve the right thereto on accepting the late delivery.

   Special Regulations

          The supplier assures that the goods are in compliance with the amendment degree of the ordinance on consumer articles (the respective version valid) and undertakes to bear the consequential damages which may result from any non-observance.

        Production can only be started after our Quality Control Department did release size set, sample and test-material.

        The waste management charges for the specially agreed transport packaging are 0.7% and sales packaging has to be marked with the “Green Dot”.

        The contract is subject to German law, proper venue is Frankfurt/ Main.  

 DOCUMENTARY CREDIT

 DESTINATION        SYNBINBBAXXX   SW 1996083OFS0000004200

SESS  2355                                                 DATE RECD 30-Aug-96-9:07

 ORIGINATOR          DEUTSCHE BANK  FROM SWIFT

SESS 2024                       BERLIN               DATE Sent 29-Aug-96

 27 / Sequence of Total Pages                       :   1 / 2

46A / Form of documentary credit              :   Irrevocable / Transferable

26 / Documentary credit number                 :   1261A3956

31C / Date of issue                                    :   96/08/29

31D/ Date and place of expiry                     :   96/11/20 BERLIN, Germany

51A/ Applicant bank                                    :   DEUTSCHE BANK

                                                                    BERLIN, Germany

51B / Advising bank                                    :   SYNDICATE BANK

                                                                   SAKET NEW DELHI, India

50 / Applicant                                              :   R.S. OFFICE PRODUCTS GmbH

                                                                   MAX PLANK – STRASSE 13

                                                                   D-68519 BERLIN, Germany

59 / Beneficiary                                           :   VIRAJ GLOBAL ENTERPRISES

                                                                  H-53 C, SAKET

                                                                  NEW DELHI 110017

320 / Currency code amount                        :   DEM 7944.00

41A / Available with/by-swift addr             :   DEUTCHE BANK

                                                                   BERLIN, Germany

                                                                  By payment

43p / Partial shipment                                  :   ALLOWED BUT ONLY

                                                                    COMPLETED ARTICLE GROUPS

43t / Transhipment                                     :   ALLOWED

44A/ON board/disp/taking charge               :   INDIAN AIRPORT

44B/For transportation to                            :  BERLIN, Germany

44C/Latest date of shipment                       :  96 /10 / 30

45A/Descr goods and/ or services               :  Goods (Girl’s Overall) as per

                                                                  purchase order no.48588 dated

                                                                  26.8.96

        6130004858 DM 8,000,00 GSP Form ‘A’ by air

      Less 0.7 percent (ENVIRONMENT BONUS)

      L/C Amount DEM 7.944,00

        FOB INIDAN AIRPORT OR

        CFR BERLIN AIRPORT

        (SEE ADDTITIONAL CONDITIONS)

46A/document required                               :  See MT 701

27/Sequence of Total Pages                         :  2 / 2

20/documentary credit number                    :  L261A3956

47A / additional conditions                         :

_____________________________________________________________

 ·      If the shipment is delayed for more than 14 days, Terms of shipment must change from FOB Indian Airport to Airfreight CFR Berlin

·      A discrepancy fee of DEM 120.00 and Telex/Swift charges, if any, will be deducted from the proceeds if documents are presented with discrepancy and acceptance of such documents does not in any way alter the terms and conditions of this credit. 46B/ document required – MT 701

·      Signed commercial invoice, original + 5 copies stamped and signed by SGS (India) Ltd., stating L.C. No. and purchase order no.

·      Copy of export cert. showing Germany as importing country, consigned to R.S. office products Gmbh, D-68519, Berlin, Germany.  

·      GSP certificate Form ‘A’ issued or certified by A Chamber of Commerce or any equal public authority consigned to R.S. office products GmbH, D-68519, Berlin, Germany.

·      Inspection certificate issued by SGS (India) Ltd. and signed by authorised representative.

·      In case of airfreight, master airway bill (MAWB) indicating exact Flight No. + date, consigned to applicant, marked freight collect, Ist notify: Applicant 2nd notify: wellmann, nuernberg, evidencing that beneficiary’s certificate, one copy of invoice and packing list are accompanying the goods. AWB to b issued by concord logistics (India) pvt. Ltd., negotiable.

·      In case of Sea-Air freight, comb, transport doc, consigned to applicant, marked, freight collect, 1st notify: applicant, 2nd notify: Hellmann Nufrnberg, evidencing that one copy of invoice and packing list are accompanying the goods.

  LB charges                                                     All commissions and charges in your

                                                                     country are beneficiary’s account

48/ period of presentation                              10 days after the date of issuance of

                                                                      the shipping docs but within credit’s

                                                                      validity.

 49/ confirmation instruction                          without

78/ instruction to pay/acc/

Vie bk                                                            Pls send all docs in one lot by courier

  TO DEUTSCHE BANK, BERLIN, GERMANY

  57D/ advise thru bank-amme add                   Your New Delhi Saket Branch

                                                                       (Syndicate Bank)

72/ Sender to receiver information                 Reimbursement:

                                                                       After Receipt L/C conform we shall

                                                                       remit proceeds.

  Question:

          As a team leader, you are required to prepare a detailed plan for the implementation of this order to ensure the shipment is sent in time.

  Assignment Solutions, Case study Answer sheets

Project Report and Thesis - Contact

aravind.banakar@gmail.com

www.mbacasestudyanswers.com

ARAVIND – 09901366442 – 09902787224

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[homestudyhelp365-blog]

You are given below the purchase order placed by M s R.S. Office Products from Germany with M s Viraz Global Exporters, Saket, New Delhi, the exporter from India

Assignment Solutions, Case study Answer sheets

Project Report and Thesis - Contact

aravind.banakar@gmail.com

www.mbacasestudyanswers.com

ARAVIND – 09901366442 – 09902787224

  Export Management

  ATTEMPT ONLY FOUR CASE STUDY

 CASE – 1

 Ms. Nilima and Ms. Sonia are very good friends. After completing their graduation in literature from a reputed college in Delhi University, they got a chance in modeling. This aroused their interest in the fashion industry. They decided to join a fashion institute to acquire proficiency in the field of designing of the ready made garments and completed two year course in designing. They have been working in the fashion industry for the last 3 years. Recently, they had been to USA in connection with a fashion show organised by one of their clients. They found that there is a lot of potential for the export of ready made garments to USA and other West European countries from India. They are now motivated to start their own export business in the field of ready made garments particularly women’s designer wear. They are willing to invest Rs. 5 lakhs each and have strong financial support to invest more money as well. As far as product is concerned, they have sufficient knowledge of fabrics, designs, accessories, dyeing, printing and fabrication processes. Ms. Sonia has also completed her MBA in International marketing from a reputed institute in Delhi. They have decided to establish their export business but do not know about the formalities involved in the establishment of their export business. They have approached you as a consultant in foreign trade for guidance.

 Question:

You are required to prepare a detailed report for their guidance so that they can establish their export business.

    CASE – 2

 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.

         CASE – 3

:

·      Product: Gents Shirts

·      Production Capacity installed: 4000 Shirts per month

·      Present capacity utilization: 2000 Shirts per month

·      Break-even level: 1400 Shirts per month

·      Fixed Costs: INR. 140,000/- per month

·      Variable Cost per shirt: INR 400 (or USD 10)

·      Selling Price / FOB Ex- New Delhi INR 500 (or USD 12.5)

          (This is based on average rate of exchange of 1 USD = INR 40)

          Duty drawback rate; 15% of FOB Value (Assumed for easy calculations)

             M/S Vivek International has received an enquiry for the supply of 1600 Shirts per month for the next one year to an importer in New York, U.S.A. But the initial talks with the importer have revealed that he would not be willing to pay USD 12.5 per shirt. He is quite inclined to pay much lower price. Since, this order would help increase capacity utilization, the economies of scale would reduce the variable cost in rupee terms by 10%. M/S Vivek International has decided to take this order.

 Question:

 You are requested to prepare a decision analysis to suggest the range of FOB prices (the minimum and the maximum) for negotiation of price with the importer. It may also be noted that the INR may weaken to a level of USD = INR 46 over the period of supply.

  CASE – 4 ON EXPORT PROMOTION

             Mr. Ram Kumar of M/S Khanna Road Carriers, New Delhi has recently ventured into export trade under the name and style of the firm called Exclusive Creations. He studied a few market reports and then decided to take up wooden handicrafts. He contacted European Business Information Centre, New Delhi and could get a few trade enquiries for the export of wooden handicrafts.

           He got a positive response from M/S Arts’N Wood in Germany. This buyer is a wholesaler-importer of Orient gift items, and accessories, with warehouse in Frankfurt and also in Sydney, Australia. After a initial round of correspondence with Mr. Joe Branke, of M/S Arts’N Wood, Mr. Branke showed his interest in wooden boxes with brass inlay of animal motifs. Mr. Kumar quoted a price of US$ 5 F.O.B. Ex- New Delhi per box. In view of the current demand trends in the market, Mr. Branke asked for a sample. He approved the sample with minor changes and initially placed a token order worth US$ 5000 for the supply of 1000 pieces on 5th October, 1999 to Mr. Kumar of the Exclusive Creations. Mr. Branke has assured Mr. Kumar that they could look forward to larger volumes of business in future, depending upon the present order. Mr. Kumar had taken the sample from a supplier in Nagina, Distt. Bijnore (UP) and was assured of its supply.

           The main features of this sample order were as follows:

(i)                 Product description & specification               :  Square wooden boxes (10” x 10”) with                                         brass inlay and of animal motifs.

(ii)               Quantity                                                          :  1000 Pcs.

(iii)             Rate and Amount                                           :   US$ 5.00 F.O.B. Ex- New                                                             Delhi Amt. $ 5000.

(iv)             Terms of Payment                                           :   US$ 2500 along with order                                                             and rest on D/P basis.

(v)               Delivery                                                          :   Goods to be consigned on or                                                             before 20th October, 1999                                                             to their warehouse in Australia.

Mr. Ram Kumar faxed a confirmation of order to Mr. Branke on October 6, 1999. He also placed order with his supplier same day for supply-by October 17, 1999.

Mr. Kumar could send the shipment on Nov. 1, 1999 since he got supply of wooden boxes on 25th October, 1999, and then the supply of card boxes for packing was also delayed due to workers strike.

Mr. Kumar sent a fax to Mr. Branke on Nov. 10, conveying his thanks for the remaining payment of US$ 2500 and expressed the hope that this sample shipment sent by him would be the beginning of their long term mutually beneficial relationship.

Mr. Kumar was, however, taken aback on receiving a fax dated November 12, 1999 from Mr. Branke in which he had stated that the wooden boxes were not as per approved sample. Mr. Branke stated that the carvings on the boxes did not have the same finish as per sample and that the brass inlays were chipped from various places, in addition to their blackening. He expressed his unhappiness over the manner in which the shipment was sent. He also referred to hold-up of the shipment by the customs authorities in Sydney as it was not fumigated as required under the Australian laws. The shipment was quarantined at the customs and as a result, Mr. Branke had to pay $300 on account of fumigation tax and warehouse charges. he had to travel 200 kms away from Sydney to get the goods fumigated. As a result of this delay, Mr. Branke lost out on some good orders.  

Mr. Branke did not touch the subject of future business with Mr.

Ram Kumar of the Exclusive Creations in his fax dated November 12, 1999.

Mr. Ram Kumar sent another Fax on November 13, 1999 explaining his position but could not elicit any response from Mr. Branke. Mr. Kumar followed it up but he drew blank.

This development was a serious set back to the efforts of Mr. Ram Kumar as he had planned to penetrate the German/Australian Market in a big way. He wants to control the situation. He has thought of a business trip to Sydney to win back the confidence of Mr. Branke and also look for opportunities for promotion of his product in the Australian Market to make a serious beginning in business.

Mr. Ram Kumar has approached you to help him. He is seeking your assistance in regard to the following questions:

(i)                 How to analyse the situation and what is real problem(s) being faced by him?

(ii)               What steps should he take to deal with this situation, in view of the fact that the items selected for exports have potential market?

(iii)             How should he plan to further promote his item(s) in the German / Australian Market?

  CASE – 5

 Mr. Rohit Gupta and Mr. Vikas Khanna decided to enter into partnership to start the business of exporting leather goods (hand bags, belts, purses, wallets etc.) they entered into partnership agreement on January 1, 1997 and signed the partnership deal on the same. They agreed to name the firm as R V International located at B-225, Sarita Vihar, New Delhi. They also agreed to contribute Rs. 75,000/- each towards the initial capital of the firm. A bank account was opened by them with Bank India, Barakhamba Road, New Delhi. On January 1, 1997 (Current Account No. 01256) with an initial deposit of Rs. 70,000/- M/S R V International applied for the grant of Importer – Exporter Code (IEC) No. the Joint DGFT, Asaf Ali Road, New Delhi on January 2, 1997. (The IEC No. 5005217 was allotted to the firm on 25 January, 1997 was as follows:

 Balance Sheet as on 1.1.1997

Liabilities

Amount

Assets

Amount

Capital A/cs

Rohit Gupta

Vikas Khanna

Rs.

75,000

75,000

 Cash in hand

Cash at Bank

Bank of India

Rs.

80,000

70,000

 1,50,000

 1,50,000

             Mr. Rohit Gupta approached Trade Information Centre, New Delhi for guidance to get some order. Following the advice, Mr. Rohit Gupta could get an order on February 25, 1997 from M/S Lionel Trains Inc. 50526. R.W. Boulevard Chesterfield Michigan, U.S.A. for the supply of 1500 leather bags (Design: RV 1021) for USD 15000 F.O.B. Ex- New Delhi. It was agreed that M/S Lionel Trains Inc. shall pay USD 2,000 as advance and the remaining USD 13000 on D/P basis. The shipment was agreed to be sent on or before May 31, 1997. The demand draft for USD 2000 issued by importer’s Bank (Bank of America, Chesterfield Michigan) was received on March 2, 1997.

           Mr. Vikas Khanna took up the responsibility for the execution of this order. He identified the following firms for supply of hand bags and packaging/packing materials. The agreed terms and conditions are:

For Supply of hand bags:                                            :   M/s Creation Impex,

                                                                                 A042, Sector 19, NOIDA UP

Total Qty                                                                   :   1550 Nos.

Supply by                                                                    :   May 05, 1997

Total Amount                                                              :   Rs. 271,250

Advance payment                                                       :   Rs. 1,50,000

Balance of delivery

 For Supply of Packaging/PackingMaterial                 :   M/S Ashima Finishers

                                                                                   :   D-126, Naraina Indl.Area,

                                                                                   :   N.Delhi

Total Amount                                                              :   Rs. 37,800

Advance Payment                                                       :   Rs. 17,000

Balance on delivery

Supply by                                                                    :   May 05, 1997

 The costing details and statement of fixed expenses are as follows:

Cost details for one Leather hand bag                        :

Variable Expenses                                                       :   $

Purchase Price                                                             :   5.00

Office Overhead                                                         :   0.50

Packaging/Packing                                                     :   0.72

Documentation and Agent Fee                                   :   0.03

ECGC Shipment                                                         :

(Comprehensive Risks) Policy Insurance

Premium                                                                      :   0.05

FOB/Cash Cost per bag                                              :   $6.30   INR 220.50

FOB Price Ex- New Delhi                                          :   $10.00 INR 350.00

Margin                                                                         :   $3.70   INR 129.50

(Rate of Exchange)                                                     :   USD = INR 35)

 Fixed expenses per Month

Rent                                                                            :   Rs. 10,000

Salaries                                                                        :   Rs. 13,500

Telephone/Electricity, Rentals                                    :   Rs.   800

Total                                                                            :   Rs. 24,300

 The Balance Sheet and Profit and Loss Account of M/S R V International, as on 28.12.1997 are as follows:

   R.V. International

Profit & Loss A/c for the period 1.1.1997 to 28.2.1997

 Particulars

Rs.

Particulars

Rs.

Printing Expenses

Stationery

Fee for IEC No.

Liaison  Expenses

Rent

Salaries to  staff

Telephone Bill  of Exchange

Electricity  Bill

Payment to  Couriers

Payment to  Consultant

Free Sample

Interest  Accrued:

Loans from Ravi  Khanna

Loan from XYZ  Finance

Office Expenses

   1,500

 1,500

 1,000

 1,500

10,000

13,500

 3,000

 1,600

    900

 5,000

35,000

   1,300

    800

 4,000

By Net  operating loss

80,600

80,600

80,600

 R.V. International

Balance Sheet as on 28.2.1997

 Liabilities

Rs.

Assets

Rs.

Capital A/cs

Rohit Gupta

Vikas Khanna

13% Unsecured  loan from

Mr. Ravi

17% Secured  Loan from

XYZ Fin.Co.

Accrued

Ravi Khanna Rs.  1300

XYZ Finance Co.  800

 Total

    75,000

  75,000

 1,30,000

    70,000

        2100

Cash in Hand

Cash at Bank

Bank of India

Furniture &  Furnishings

Computer

Inventories

 Net operating  loss

    6,500

  30,000

 1,40,000

  50,000

  45,000

    80,000

3,52,100

3,52,100

M/S R V International do not have sufficient funds to execute this order.

 Mr. Vikas Khanna would like to apply for pre-shipment finance (packing credit). He is not sure whether he would be able to obtain the funds from the bank. He seeks you advice in this matter.

   CASE – 6    EXECUTION OF EXPORT ORDER

          You are given below the purchase order placed by M/s R.S. Office Products from Germany with M/s Viraz Global Exporters, Saket, New Delhi, the exporter from India. The payment terms stipulated in the order relate to payment by means of irrevocable letter of credit. The order and the letter of credit are given below. You are appointed as the team leader for the execution of this order by the managing partner of the export firm for the execution of this order.

                                                  PURCHASE ORDER

Order Placed by                            : R.S. OFFICE PRODUCTS GmbH

                                                       MAX PLANK-STRASSE 13

                                                        D-68519 BERLIN GERMANY

Order No.                                      : 48588

Date                                                   : 26.08.96

Supplier                                        : VIRAJ GLOBAL EXPORTERS

                                                       H-53, C, SAKET

                                                       NEW DELHI 110 017

Article Description                        : OVERALL

Article details / materials              : 100% Boumolle, 40’s Cambric (40x40/92x80)

Colour / Print                                : Blue / Printed Marigold Binding band at back

                                                       In Colour 200 pcs

          Size                                         Quantity in Pcs Unit          Price in DEM

         98                                                       20                                   40.00

        104                                                      20                                   40.00

        116                                                      40                                   40.00

        128                                                      60                                   40.00

        140                                                      60                                   40.00

 Delivery Date                                :  30.10.96

Packing Instruction                       :  Shipment in standard cartons with polybags

                                                        single piece packing according to our shipping

                                                        instructions.

Total Amount                                :  DM 8000.00

Export Licence category               :  78 (Non-Restrained)

Terms of Payment                         :  L/C

Mode of transport                         :  Air

Destination                                   :  Berlin

Further agreements                       :  Polybag / Normacarton N4, 60 x 40 x 40 cm

          The supplier has to pay a fine if the stipulated delivery dates are not met, no matter whether he caused the delay or not. The fine amounts to 0.5% per calendar day, however not more than 20% of the total remuneration agreed. We can insists on the fine until final account has been done, even if we don not expressly reserve the right thereto on accepting the late delivery.

   Special Regulations

          The supplier assures that the goods are in compliance with the amendment degree of the ordinance on consumer articles (the respective version valid) and undertakes to bear the consequential damages which may result from any non-observance.

        Production can only be started after our Quality Control Department did release size set, sample and test-material.

        The waste management charges for the specially agreed transport packaging are 0.7% and sales packaging has to be marked with the “Green Dot”.

        The contract is subject to German law, proper venue is Frankfurt/ Main.  

 DOCUMENTARY CREDIT

 DESTINATION        SYNBINBBAXXX   SW 1996083OFS0000004200

SESS  2355                                                 DATE RECD 30-Aug-96-9:07

 ORIGINATOR          DEUTSCHE BANK  FROM SWIFT

SESS 2024                       BERLIN               DATE Sent 29-Aug-96

 27 / Sequence of Total Pages                       :   1 / 2

46A / Form of documentary credit              :   Irrevocable / Transferable

26 / Documentary credit number                 :   1261A3956

31C / Date of issue                                    :   96/08/29

31D/ Date and place of expiry                     :   96/11/20 BERLIN, Germany

51A/ Applicant bank                                    :   DEUTSCHE BANK

                                                                    BERLIN, Germany

51B / Advising bank                                    :   SYNDICATE BANK

                                                                   SAKET NEW DELHI, India

50 / Applicant                                              :   R.S. OFFICE PRODUCTS GmbH

                                                                   MAX PLANK – STRASSE 13

                                                                   D-68519 BERLIN, Germany

59 / Beneficiary                                           :   VIRAJ GLOBAL ENTERPRISES

                                                                  H-53 C, SAKET

                                                                  NEW DELHI 110017

320 / Currency code amount                        :   DEM 7944.00

41A / Available with/by-swift addr             :   DEUTCHE BANK

                                                                   BERLIN, Germany

                                                                  By payment

43p / Partial shipment                                  :   ALLOWED BUT ONLY

                                                                    COMPLETED ARTICLE GROUPS

43t / Transhipment                                     :   ALLOWED

44A/ON board/disp/taking charge               :   INDIAN AIRPORT

44B/For transportation to                            :  BERLIN, Germany

44C/Latest date of shipment                       :  96 /10 / 30

45A/Descr goods and/ or services               :  Goods (Girl’s Overall) as per

                                                                  purchase order no.48588 dated

                                                                  26.8.96

        6130004858 DM 8,000,00 GSP Form ‘A’ by air

      Less 0.7 percent (ENVIRONMENT BONUS)

      L/C Amount DEM 7.944,00

        FOB INIDAN AIRPORT OR

        CFR BERLIN AIRPORT

        (SEE ADDTITIONAL CONDITIONS)

46A/document required                               :  See MT 701

27/Sequence of Total Pages                         :  2 / 2

20/documentary credit number                    :  L261A3956

47A / additional conditions                         :

_____________________________________________________________

 ·      If the shipment is delayed for more than 14 days, Terms of shipment must change from FOB Indian Airport to Airfreight CFR Berlin

·      A discrepancy fee of DEM 120.00 and Telex/Swift charges, if any, will be deducted from the proceeds if documents are presented with discrepancy and acceptance of such documents does not in any way alter the terms and conditions of this credit. 46B/ document required – MT 701

·      Signed commercial invoice, original + 5 copies stamped and signed by SGS (India) Ltd., stating L.C. No. and purchase order no.

·      Copy of export cert. showing Germany as importing country, consigned to R.S. office products Gmbh, D-68519, Berlin, Germany.  

·      GSP certificate Form ‘A’ issued or certified by A Chamber of Commerce or any equal public authority consigned to R.S. office products GmbH, D-68519, Berlin, Germany.

·      Inspection certificate issued by SGS (India) Ltd. and signed by authorised representative.

·      In case of airfreight, master airway bill (MAWB) indicating exact Flight No. + date, consigned to applicant, marked freight collect, Ist notify: Applicant 2nd notify: wellmann, nuernberg, evidencing that beneficiary’s certificate, one copy of invoice and packing list are accompanying the goods. AWB to b issued by concord logistics (India) pvt. Ltd., negotiable.

·      In case of Sea-Air freight, comb, transport doc, consigned to applicant, marked, freight collect, 1st notify: applicant, 2nd notify: Hellmann Nufrnberg, evidencing that one copy of invoice and packing list are accompanying the goods.

  LB charges                                                     All commissions and charges in your

                                                                     country are beneficiary’s account

48/ period of presentation                              10 days after the date of issuance of

                                                                      the shipping docs but within credit’s

                                                                      validity.

 49/ confirmation instruction                          without

78/ instruction to pay/acc/

Vie bk                                                            Pls send all docs in one lot by courier

  TO DEUTSCHE BANK, BERLIN, GERMANY

  57D/ advise thru bank-amme add                   Your New Delhi Saket Branch

                                                                       (Syndicate Bank)

72/ Sender to receiver information                 Reimbursement:

                                                                       After Receipt L/C conform we shall

                                                                       remit proceeds.

  Question:

          As a team leader, you are required to prepare a detailed plan for the implementation of this order to ensure the shipment is sent in time.

  Assignment Solutions, Case study Answer sheets

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