1. Copyright © 2013 Pearson Education 13-1 International Business Environments & Operations 14e Global Edition Daniels ● Radebaugh ● Sullivan

2. Copyright © 2013 Pearson Education 13-2 Chapter 13 Export and Import

3. Copyright © 2013 Pearson Education 13-3 Learning Objectives  To introduce the idea of exporting and profile its elements  To introduce the idea of importing and profile its elements  To identify the problems and pitfalls that challenge international traders  To identify the resources and assistance that helps international traders  To discuss the idea of an export plan  To outline the practice of countertrade

4. Copyright © 2013 Pearson Education 13-4 Introduction  Exporting and importing are the most common modes of international business  Exporting and importing are one of the fastest growing activities in the world

5. Copyright © 2013 Pearson Education 13-5 Introduction Environmental Factors Influencing Export and Import Operations

6. Copyright © 2013 Pearson Education 13-6 Exporting Learning Objective 1: To introduce the idea of exporting and profile its elements

7. Copyright © 2013 Pearson Education 13-7 Exporting  Exporting the sale of goods or services produced by a company based in one country to customers that reside in a different country  Types of exporters Non-exporter Occasional exporter Regular exporter

8. Copyright © 2013 Pearson Education 13-8 Exporting  Entry mode is influenced by  Ownership advantages the firm’s core competencies  Location advantages the combination of sales opportunity and investment risk that creates favorable locations in foreign markets  Internalization advantages reflect companies’ response to market imperfections that often create uncertainties

9. Copyright © 2013 Pearson Education 13-9 Characteristics of Exporters  Size Large Small and medium-sized enterprises (SMEs)  Management commitment  Efficiency  Cost structure

10. Copyright © 2013 Pearson Education 13-10 Why Export?  Reasons to export include Profits Productivity Diversification

11. Copyright © 2013 Pearson Education 13-11 Exporters: Initiation and Development  Two approaches Incremental internationalization  exporting is a learning process Born global  instant internationalization  global focus

12. Copyright © 2013 Pearson Education 13-12 Exporters: Initiation and Development Top Ten Trade Partners of the United States

13. Copyright © 2013 Pearson Education 13-13 Approaches to Exporting  Export approaches include Direct exporting  involves independent representatives, distributors, or retailers outside of the exporter’s home country Indirect exporting  products are sold to an intermediary in the domestic market, which then exports them Passively filling orders from domestic buyers who then export the product Selling to domestic buyers who represent foreign end users or customers

14. Copyright © 2013 Pearson Education 13-14 Importing Learning Objective 2: To introduce the idea of importing and profile its elements

15. Copyright © 2013 Pearson Education 13-15 Importing  Importing the purchase of a good or service by a buyer in one country from a seller in another  Types of importers Input optimizers Opportunistic Arbitrageurs

16. Copyright © 2013 Pearson Education 13-16 Characteristics of Importers  Size most are also exporters  Efficiency  Innovation  Commitment

17. Copyright © 2013 Pearson Education 13-17 Why Import?  Reasons to import Specialization of labor Global rivalry Local unavailability Diversification Top management outlook

18. Copyright © 2013 Pearson Education 13-18 Importing and Exporting: Problems and Pitfalls Learning Objective 3: To identify the problems and pitfalls that challenge international traders

19. Copyright © 2013 Pearson Education 13-19 Importing and Exporting: Problems and Pitfalls  Financial risks  Customer management  Lack of international business experience  Marketing barriers  Top management commitment  Trade regulations  Trade documentation

20. Copyright © 2013 Pearson Education 13-20 Importing and Exporting: Problems and Pitfalls Types of Export Documents

21. Copyright © 2013 Pearson Education 13-21 Importing and Exporting: Resources and Assistance Learning Objective 4: To identify the resources and assistance that helps international traders

22. Copyright © 2013 Pearson Education 13-22 Importing and Exporting: Resources and Assistance  Companies can get resources and assistance from Government agencies The U.S. Department of Commerce International Trade Administration The Small Business Administration

23. Copyright © 2013 Pearson Education 13-23 Importing and Exporting: Resources and Assistance Trade Information by Type and Source

24. Copyright © 2013 Pearson Education 13-24 Importing and Exporting: Resources and Assistance  Export intermediaries third party firms that market products and services abroad on behalf of manufacturers, farm groups, and distributors  Export management company (EMC)  Export trade companies (ETC)

25. Copyright © 2013 Pearson Education 13-25 Importing and Exporting: Resources and Assistance  Customs agents enforce the rules of trade for a particular country  Customs brokers help importers navigate the regulations imposed by customs agencies

26. Copyright © 2013 Pearson Education 13-26 Importing and Exporting: Resources and Assistance Where the Trading is Easy – and Where it is Not

27. Copyright © 2013 Pearson Education 13-27 Importing and Exporting: Resources and Assistance  Freight forwarders the largest export/import intermediary in terms of value and weight of products shipped internationally

28. Copyright © 2013 Pearson Education 13-28 Importing and Exporting: Resources and Assistance  Third party logistics (3PLs) move cargo and provide a range of logistics options work in partnership with manufacturers, shippers, and retailers

29. Copyright © 2013 Pearson Education 13-29 Reconciling Opportunity and Challenge: An Export Plan Learning Objective 5: To discuss the idea of an export plan

30. Copyright © 2013 Pearson Education 13-30 Reconciling Opportunity and Challenge: An Export Plan  Export plan identifies useful resources, assigns responsibility, and stipulates controls

31. Copyright © 2013 Pearson Education 13-31 Reconciling Opportunity and Challenge: An Export Plan An Export Plan

32. Copyright © 2013 Pearson Education 13-32 Countertrade Learning Objective 6: To outline the practice of countertrade

33. Copyright © 2013 Pearson Education 13-33 Countertrade  Countertrade different arrangements that parties use to trade products via transactions that use limited or no currency or credit  Costs inefficient risky cumbersome  Benefits build mutually beneficial relationships

34. Copyright © 2013 Pearson Education 13-34 Countertrade Common Types of Countertrade

35. Copyright © 2013 Pearson Education 13-35 Technology and International Trade  Advances in technology are leveling the playing field for SMEs Online platform Software platform Logistics platform

36. Copyright © 2013 Pearson Education 13-36 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.