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International

Business
Environments & Operations
15e
Daniels

Radebaugh

Copyright © 2015 Pearson Education, Inc.

Sullivan

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Chapter 14
Export and Import

Copyright © 2015 Pearson Education, Inc.

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Learning Objectives
Explain the idea of exporting and profile its
elements
 Explain the idea of importing and profile
its elements
 Evaluate the relative benefits and
drawbacks of the export and import of ewaste
 Describe the problems and pitfalls that
challenge international traders

Copyright © 2015 Pearson Education, Inc.

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Inc.Learning Objectives Define the idea of an export plan  Discuss the practice of countertrade  Describe the resources and assistance for international traders  Identify and discuss the platforms that support expanding international trade  Copyright © 2015 Pearson Education. 13-4 .

14-5 .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  Copyright © 2015 Pearson Education. Inc.

14-6 . Inc.World Trade 1960-2010 Copyright © 2015 Pearson Education.

14-7 .Introduction Environmental Factors Influencing Export and Import Operations Copyright © 2015 Pearson Education. Inc.

Exporting Learning Objective: Explain the idea of exporting and profile its elements Copyright © 2015 Pearson Education. 14-8 . Inc.

Inc.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 Copyright © 2015 Pearson Education. 14-9 .

Exporting Entry mode is influenced by  Ownership advantages    Location advantages   the firm’s core competencies 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 Copyright © 2015 Pearson Education. 14-10 . Inc.

14-11 .Characteristics of Exporters Size  Large  Small and medium-sized enterprises (SMEs)  Management commitment  Efficiency  Cost structure  Copyright © 2015 Pearson Education. Inc.

Why Export?  Reasons to export include  Profits  Productivity  Diversification Copyright © 2015 Pearson Education. Inc. 14-12 .

14-13 .Exporters: Initiation and Development  Two approaches  Incremental internationalization  exporting is a learning process  Born global  instant internationalization  global focus Copyright © 2015 Pearson Education. Inc.

14-14 .Exporters: Initiation and Development Top Trade Partners of the United States: Exports and Imports Copyright © 2015 Pearson Education. Inc.

or retailers outside of the exporter’s home country Indirect exporting  products are sold to an intermediary in the domestic market. distributors. Inc.Approaches to Exporting  Export approaches include     Direct exporting  involves independent representatives. 14-15 . 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 Copyright © 2015 Pearson Education.

Importing Learning Objective: Explain the idea of importing and profile its elements Copyright © 2015 Pearson Education. 14-16 . Inc.

14-17 .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 Copyright © 2015 Pearson Education. Inc.

Why Import?  Reasons to import Specialization of labor  Global rivalry  Local unavailability  Diversification  Copyright © 2015 Pearson Education. 14-18 . Inc.

Importing and Exporting: Problems and Pitfalls Learning Objective: Describe the problems and pitfalls that challenge international traders Copyright © 2015 Pearson Education. 14-19 . Inc.

14-20 .Importing and Exporting: Problems and Pitfalls Financial risks  Customer management  Lack of international business experience  Marketing challenges  Top management commitment  Government regulation  Trade documentation  Copyright © 2015 Pearson Education. Inc.

14-21 .Importing and Exporting: Problems and Pitfalls Types of Export Documents Copyright © 2015 Pearson Education. Inc.

Importing and Exporting: Resources and Assistance Learning Objective: Describe the resources and assistance for international traders Copyright © 2015 Pearson Education. 14-22 . Inc.

S. 14-23 . Department of Commerce International Trade Administration  The Small Business Administration Copyright © 2015 Pearson Education.Importing and Exporting: Resources and Assistance  Companies can get resources and assistance from  Government agencies  The U. Inc.

Inc.Importing and Exporting: Resources and Assistance Trade Assistance by Type and Source Copyright © 2015 Pearson Education. 14-24 .

farm groups. 14-25 .Importing and Exporting: Resources and Assistance  Export intermediaries  third party firms that market products and services abroad on behalf of manufacturers. Inc. and distributors  Export management company (EMC)  Export trade companies (ETC) Copyright © 2015 Pearson Education.

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 Copyright © 2015 Pearson Education. 14-26 . Inc.

14-27 . Inc.Importing and Exporting: Resources and Assistance Where the Trading is Easy – and Where it is Not Copyright © 2015 Pearson Education.

Importing and Exporting: Resources and Assistance  Freight forwarders  the largest export/import intermediary in terms of value and weight of products shipped internationally Copyright © 2015 Pearson Education. 14-28 . Inc.

shippers. Inc. 14-29 . and retailers Copyright © 2015 Pearson Education.Importing and Exporting: Resources and Assistance  Third party logistics (3PLs)  move cargo and provide a range of logistics options  work in partnership with manufacturers.

Inc. 14-30 .Reconciling Opportunity and Challenge: An Export Plan Learning Objective: Define the idea of an export plan Copyright © 2015 Pearson Education.

14-31 .Reconciling Opportunity and Challenge: An Export Plan  Export plan  identifies useful resources. assigns responsibility. and stipulates controls Copyright © 2015 Pearson Education. Inc.

14-32 . Inc.Reconciling Opportunity and Challenge: An Export Plan An Export Plan Copyright © 2015 Pearson Education.

Countertrade Learning Objective: Discuss the practice of countertrade Copyright © 2015 Pearson Education. Inc. 14-33 .

14-34 . Inc.Countertrade  Countertrade   Costs     different arrangements that parties use to trade products via transactions that use limited or no currency or credit inefficient risky cumbersome Benefits  build mutually beneficial relationships Copyright © 2015 Pearson Education.

Inc.Countertrade Common Types of Countertrade Copyright © 2015 Pearson Education. 14-35 .

Inc.Technology and International Trade  Advances in technology are leveling the playing field for SMEs    Online platform Software platform Logistics platform Copyright © 2015 Pearson Education. 14-36 .

or otherwise. or transmitted. in any form or by any means. recording. Copyright © 2015 Pearson Education. without the prior written permission of the publisher. Printed in the United States of America. photocopying. stored in a retrieval system. No part of this publication may be reproduced. 14-37 . Inc. mechanical. electronic.All rights reserved.