Indirect exporting is best understood in contrast to direct exporting. When a company engages in direct exporting, it takes the goods that it makes and sells them to firms in other countries. When firms engage in indirect exporting, there is another step in the process. Instead of selling directly abroad, the firm sells its goods to another firm within its own country. That firm acts as an intermediary. It buys the goods from the original company and then sells them overseas. This reduces the risk and the need for major capital investment on the part of the company that produces the goods.