FACTORS INFLUENCING COST FORMATION IN THE IMPLEMENTATION OF COMPANIES’ COMPETITIVE POLICIES IN FOREIGN TRADE

Abstract

This article provides an overview of the concepts of product competitive advantage and an exporter’s competitive policy, which has made it possible not only to clarify the relationship between them but also to identify the direction of competitive policy’s influence on the development and realization of product competitive advantages in foreign markets. The main objective of the article is to provide analytical confirmation of the appropriateness of using a targeted approach to shaping an exporter’s competitive policy in the relevant foreign market. Based on a study of global and national requirements for honey in a sample of countries with the largest volumes of honey imports, the study identified both a varied list of laboratory tests confirming the quality and safety of honey and differing requirements regarding the type of honey. Such discrepancies influence the formation of varying costs associated with verifying the authenticity of honey. This article summarizes the list of basic administrative and market requirements for entering the markets of the EU, the U.S., Japan, and the United Kingdom, the costs of meeting which influence an exporter’s choice of competitive strategy in the respective market. An exporter’s competitive strategy is implemented through the negotiation of terms in foreign trade contracts, which constitute a set of managerial actions aimed at realizing the competitive advantages of the product and the economic interests of the parties to the agreement. A comparative analysis of customs tariffs on imports of natural honey in a sample of foreign markets was conducted, as these tariffs represent a real source of costs for the exporter and a factor influencing the choice of its competitive policy. A conceptual model is proposed to illustrate how costs influence the formation of exporters’ competitive policies in a given foreign market; this model reflects the economic determinants of foreign trade, types of competitive policies, and the impact of cost changes on these policies. The types of competitive policies adopted by honey exporters in a sample of foreign markets are summarized, and the tools for implementing them are systematized. The practical value of the study lies in identifying types of competitive policies and summarizing the costs of implementing them, which forms a modern knowledge base for honey export companies and allows for the evaluation of the effectiveness of potential honey export proposals.