International Business Environments and Operations, 13/e Global Edition

Copyright 2011 Pearson Education
13-1
International Business
Environments and Operations,
13/e
Global Edition
Part 5
Global Strategy, Structure, and
Implementation
13-2
Chapter
13
Export
and
Import
Strategies
13-3
Chapter Objectives
To introduce the ideas of export and import
To identify the elements of export and
exporting strategies
To compare direct and indirect selling of
exports
To identify the elements of import and
importing strategies
To discuss the types and roles of third-party
intermediaries
To profile the role of counter-trade

13-4
Exporting and Importing
Exporting refers to the sale of goods or
services produced by a company based in
one country to customers that reside in a
different country.
Importing is the converse: the purchase of
products by a company based in one country
from sellers that reside in another.

13-5
Worlds Top Trading Countries
13-6
Environmental Factors Influencing
Export and Import Operations

13-7
Export Strategy
Advantages to exporting
Requires less expertise, time, and capital
than other modes of entry
Operational control
Helps companies expand and diversify
sales as well as achieve economies of
scale
13-8
Questions to Consider
Companies typically consider the following questions in
evaluating the export option:
What do we want to gain from exporting?
Is exporting consistent with our goals?
Will exporting put undue demands on our resources? If so, how
will we meet them?
Does exporting leverage our core competency?
Does exporting fit the current configuration of our value chain?
Do our coordination systems support the needs posed by
exporting?
Are the projected benefits of exporting worth the costs?
Would our resources be better used to develop new domestic
business?

13-9
Characteristics of Exporters
Although the largest companies are the
biggest exporters, small companies are also
expanding their export capability.
Firm characteristics moderate its export
intensity. Size plays a role, but often
management commitment, efficiency, and
cost structure matter more.

13-10
Two Views of Export Development
Two views of export shape interpretation:
The slow, sequential dynamic of incremental
internationalization and the instant
internationalization of the born global

13-11
Phases of
Export Development

13-12
Pitfalls of Exporting
Adjusting Financial Management
Adjusting Customer Management
Adjusting for Information Technology
Additional Stumbling Blocks
13-13
Designing an Export Strategy
1. Assess the companys export potential by
examining its opportunities and resources.
2. Obtain expert counseling on exporting.
3. Select a market or markets.
4. Formulate and implement an export strategy.

13-14
Import Strategy
There are three types of importers:
Those looking for any product around the
world to import and sell.
Those looking for foreign sourcing to get
their products at the cheapest price.
Those using foreign sourcing as part of their
global supply chain.

13-15
Advantages of Importing
Specialization of Labor
Global Rivalry
Local Unavailability
Diversification of Operating Risks
13-16
Import Brokers
Key Broker Functions:
Valuing products in such a way that they qualify
for more favorable duty treatment
Qualifying for duty refunds through drawback
provisions
Deferring duties by using bonded warehouses and
foreign trade zones
Document and paper-flow management
Limiting liability by properly marking an imports
country of origin

13-17
Customs Agencies
Procedural Assistance
Efficiency Improvement
13-18
Future: The Technology of Trade
Advances in transportation and
communication increases trade
Collaborative software allows smaller
companies to engage in international trade
more efficiently
3
rd
Party Logistics

13-19
Import Documentation
Bureaucratic Impediments
The efficiency of importing is challenged by
delays, documents, and fees.

13-20
The Export Process
Principal types of exporting:
Directproducts sold to an independent
party outside of the exporters home
country.
Indirect exportsproducts sold to an
intermediary in the domestic market,
which then sells the goods in the export
market.
13-21
Indirect Selling
Export Intermediaries
Export Management Companies: operate
on a contractual basisusually as an
agent of the exporter.
Export Trading Companies: operate based
on demand rather than supply. They
identify suppliers who can fill orders in
overseas markets.

13-22
Direct Selling
Direct selling involves sales representatives,
distributors, or retailers.
Direct Selling to Foreign Retailers and End
Users
Direct Selling over the Internet

13-23
Export Documentation
Key export documents are:
Pro forma invoice
Commercial invoice
Bill of lading
Consular invoice
Certificate of origin
Shippers export declaration
Export packing list

13-24
Sources of Regulatory Assistance
In the United States, a number of institutions,
most notably the Department of Commerce
and its affiliates, help firms identify and
realize export and import opportunities.

13-25
Freight Forwarders
A foreign freight forwarder is an export or import
specialist dealing in the movement of goods
from producer to consumer.
Primary transportation modes include:
Surface freight (truck and rail), ocean
freight, and airfreight.
Intermodal transportationthe movement
across different modes from origin to
destination.

13-26
Counter-trade
This is an umbrella term for several sorts of
trade, such as barter or offset, in which the
seller accepts goods or services, rather than
currency or credit, in payment for its products.

13-27
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.

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Copyright 2011 Pearson Education

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