INBS 250 INBS 250
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This 3 page Class Notes was uploaded by Maria Notetaker on Thursday September 15, 2016. The Class Notes belongs to INBS 250 at Montclair State University taught by Nahra in Spring 2015. Since its upload, it has received 7 views. For similar materials see Introduction to International Business in International Business at Montclair State University.
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Date Created: 09/15/16
Ch. 16 - Export and Import Strategies Friday, March 27, 2015 12:05 PM Export: product outflows Import: product inflows goods and services (imp: tech support) Export Strategy: decision to export must take into account global concentration, global synergies and global strategic motivations (shipping product as is/not making any changes) Advantages: o Increases revenues and profitability right away (get paid before merchandise is shipped) o Achieve economies of scale in production and research o Alleviate excess capacity (inventory that isn't sold in domestic market) in domestic operations o Minimize risk o Diversify markets Stages: o 1: preengagement: not actively trying to sell products in foreign markets o 2: initial exporting: start having excess inventory ; start considering establishing relationships with retailers, wholesalers, etc. in foreign countries ; not aggressive o 3: advanced: companies become regular exporters ; companies receive extensive overseas experience ; aggressive Pitfalls: o Failure to obtain qualified export counseling and/or marketing intermediaries o Insufficient commitment of top management o Poor selection of overseas agents or distributors o Unwillingness to make necessary modifications o Underestimation of total transaction costs or when revenues start coming in EXPORT DOCUMENTATION Pro forma invoice (a dummy invoice) A shipper's export declaration Bill of lading (receipt that proves you shipped the merchandise from ship) Consular invoice (commercial you generate ; take to consulate) Certificate of origin (form you have to fill that states where the products where manufactured) Commercial invoice (defers from pro forma invoice bill them for what they actually ship) Export packing list (will identify how many boxes you have and what's in each box) Foreign freight forwarder: an international trade specialist who assists in the delivery of goods from producer to consumer Intermodal transportation: the movement of goods across a variety of modes from origin to destination maria gori at 3/27/2015 12:43 PM Being paid in 2 ways: Wire transfer (cash) into your account Letters of Credit: a legally binding agreement b/t the importer and their bank as well as the exporter in their bank; provide some means of getting paid and securing shipments o Application: specify the requirements that you have for that transaction taking place (ex: specify ship date [sailing date of the vessel], specific shipping box [with your address on every box], etc.) o 3 documents you can ask for/present at the bank: Bill of lading Packing list Commercial invoice > provided by you
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