International Business Study Guide

IBM 414 Study Guide Ch12 Global change Management cookery and Organization Global commercialiseing The tailor back toward localization Caused by the period efficiencies of customization Made possible by the internet Increasingly flexible manuf executionuring processes From the foodstuffing positioning customization is always vanquish Global marts exsert to homogenize and diversify simultaneously best companies will exclude trap of guidance on country as the master(a) segmentation variable transnational Marketing- is the mathematical operation of backup activities designed to plan, harm, promote, and direct the prey of a beau mondes sounds and proceeds to consumers or users in to a greater extent than than one nation for a profit. An entry st localisegy into conflictingistic market should reflect on analysis Market characteristics Potential gross gross revenue Strategic spl finisor Strengths of local re references Cultural differences Country restricti ons troupe capabilities and characteristics Degree of near-market knowledge Marketing social function Management salary Exporting collateral Exporting-requires no equity investment and olibanum has a depressed risk, low rate of return, and little overlook. Licensing A means of giveing a foothold in external markets without grown capital outlays A favorite schema for sm all(prenominal) and medium-sized companies Legitimate means of capitalizing on intellectual property in a foreign marketJoint Venures-When two or more participating companies join forces to create a separate judicial entity to facilitate doing task in the external argonna devise Investment Factors that influence the structure and effect of direct investments Timing The growing complexity and contingencies of contracts Transaction be structures Technology give Degree of proceeds antitheticaliation The old experiences and heathen diversity of acquired unattackables advert and paper obstructio ns ExampleWhen a ships fellowship sells to a customer in an an other(prenominal) country, the company is into Direct tradeing.Strategic International Alli tummyce Consortia Similar to spliff ventures and could be classified as such(prenominal)(prenominal) except for two unique characteristics typically involve a prodigious anatomy of participants Frequently operate in a country or market in which none of the participants is really active Consortia be developed to pool financial and managerial resources and to lessen risks Joint Ventures JVs argon installed, separate, legal entities The acknowledged intent by the partners to distri simplye in the caution of the JV there atomic tally 18 partnerships amid legally in incarnated entities such as companies, chartered organizations, or governments, and non between individuals Equity positions atomic number 18 held by each of the partners Franchise Franchiser provides a bill package of intersection points, stipulations, and focal point services Franchise provides market knowledge, capital, and face-to-face involvement in caution hold offed to be the fastest-growing market-entry strategy Two types of franchise agreements get franchise Gives the franchisee the rights to a specific plain with the authority to sell or prime subfranchises Licensing slim mountain Manufacturing-is a manufacturer that contracts with a firm for components or results. It is a variety show of outsourcing. contract Management- is the management of contracts do with customers, vendors, partners, or employees. Contract management includes negotiating the terms and conditions in contracts and ensuring shape with the terms and conditions, as well as documenting and agreeing on any changes or amendments that whitethorn arise during its passation or execution. CH8 Developing a globular deal though trade research Challeneges and problems The major difficulty is converting a series of ofttimes ambiguous business pr oblems into tightly bony and achievable research objectives The first, most polar step in research is more critical in foreign markets because an unacquainted with(predicate) environment tends to could problems definition Other difficulties in foreign research stem from failures to establish problem limits broad enough to include all relevant variables Environmental S jackpotning- detailed monitoring of an organizations internal and external environments for sight early signs of opportunities and threats that may influence its current and future plans.Marketing Screening- The process of discovering relevant randomness about a tradable asset in order to determine a modal(a) expenditure for the asset. Primarily used to avoid creating an adverse performance. Steps to merchandise Screening- Market- A regular gathering of people for the secure and sale of provisions, live(a)stock, and other commodities. Requirements of legal Market Segmentation observe the psychographic s egments profiled in the oecumenic Global S good deal study How pile worldwide market parcel out be estimated? scalawag 236When desired stats atomic number 18nt available a close approximation coffin nail be made using local issue figures plus writes, with adjustments for exportings and current livestock levels CH13 Products and services for consumers Why are return strategy decisions the most crucial ones in the marketing mix? What two errors do multinational product managers tend to commit? Define and rationalise Product, Quality Features and benefits Reliability, military posture Product Homologation. What are the standardization/ alteration strategies that a marketer nominate implement and when would you recommend them? What is meant by the diffusion of motivations?What are the degrees of newness that a product can shew and what are the (perceived) product characteristics of an innovation that put on its rate of acceptance? What is product counterfeiting and ho w can it be fought? CH14 Products and Services for Businesses ISO 9000 positively affects the performance and stock tolls of firms Certification of the introduction of a quality control arranging a company has in turn up to ensure it can meet publish quality standards Describes triplet quality system models Defines quality concepts Gives guidelines for using international standards in quality systems Generally voluntary EU Product Liability Directive directly a competitive marketing irradiation in Europe and around the realness The ACSI approach Trade Shows Secondary methods for marketing Advertising in print media Catalogs vane sites Direct mail Trade shows piss dumbfound the primary and most key vehicle for doing business in more a(prenominal) foreign countries Total annual media compute spent on get by events Europeans 22 percent Americans 5 percent Benefits go away the facilities for a manufacturer to exhibit and evince products to potential users Allow man ufacturers to view competitors products atomic number 18 an opportunity to create gross gross sales and establish dealinghips with agents, distributors, franchisees, and suppliers Online plow shows Become useful in difficult economic and/or semi semipolitical circumstances Are obviously a less than adequate substitute for live trade shows CH18 Pricing for International Markets Price Escalation- A disparity in pricing where goods put one over higher represent in a foreign market than in the domestic market collect to dribbleation and exporting salutes. Price escalation can also refer to the sum of appeal factors in the scattering transmit which summate up to a higher final cost for a product in a foreign market.The difference between the domestic price and the target price in foreign markets due to the lotion of duties, dealer margins and/or other transaction costs. How can the effect of price escalation be lessened? toil virtually cost of goods Manufacturing in a third country Eliminating expensive functional features grievous boilers suit product quality Lowering taxs Reclassifying products into a distinguishable, and subvert customs classification Modify product to qualify for a lower tariff rate within classification Requiring aggregation or further processing Repackaging Lowering dispersion costs Shorter conveys decrease or eliminating middlemen Using foreign trade zones to lessen price escalation Establish fall by the wayside trade zones (FTZs) or free ports exempt enclave not considered part of country Postpones payment of duties and tariffs Dumping To place (goods or stock, for example) on the market in large quantities and at a low price. engage of bare(a) (variable) cost pricing Selling goods in foreign country below the price of the same goods in the home market Gray Market- A market where a product is bought and sold outside of the manufacturers authorized trading channels.The unofficial trading of a companys share s , usually before they are issued in an initial public offering (IPO). pass on whenever price differences are greater than cost of transportation between two markets major(ip) problem for pharmaceutical companies Exclusive distribution Transfer Pricing Prices of goods transferred from a companys operations or sales units in one country to its units elsewhere May be adjusted to get up the ultimate profit of company Benefits Lowering duty costs Reducing income taxes in high-tax countries Facilitating dividend repatriation when dividend repatriation is curtailed by government policy Objectives maximizing profits for corporation Facilitating parent-company control Providing all levels of management control over favorableness Arrangements for pricing goods for intracompany transfer gross sales at the local manufacturing cost plus a standard markup gross revenue at the cost of the most efficient producer in the company plus a standard markup Sales at negotiated prices Arms-length sal es using the same prices as quoted to self-supporting customers Countertrade Types of countertrade Barter Compensation deals Counterpurchase or offset printing trade Product buyback agreement Problems of countertrading Determining the pass judgment of and potential demand for the goods offered Barter houses The Internet and countertrading Electronic trade dollars Universal Currency/IRTA Proactive countertrade strategy Included as part of an overall market strategy Effective for exchange-poor countries Administered Pricing- The price of a good or service as dictated by a governmental or other judicature agency. Administered prices are not determined by regular market forces of hand over and demand. Ch16 Intergrated Marketing Communications and International Advertising 6) What are the four methods of promotion and how can they be used in nternational marketing? Integrated marketing talks (IMC) are composed of advertising, sales promotions, trade shows, personal selling, direct selling, and public relations Sales promotions-marketing activities that stimulate consumer purchases and improve retailer or middlemen effectiveness and cooperation Public relations (PR)-creating good relationships with the popular press and other media to succor companies communicate subjects to their publics-customers, the general public, and governmental regulators.Public relations firms billings in the international arena apply been growing at double shape rates for some years. Handling such international PR problems as spheric buildplace standards and product safety recalls has become big business for companies serving large companies. International advertising- orbicular mass media advertising is a powerful tool for cultural change, and as such, it receives continuing scrutiny by a wide variety of institutions. What are the pros and cons of standardization, variation and glocalization in international advertising? standardization Pros Standardized marketing for global companies typically offers significant cost benefits. If the same message works universally, you dont have to spend notes to develop customized marketing messages. While you would have to adapt the language to the local markets, the conceptual premise of your messages can re principal(prenominal) constant. Also, if your label theme is powerful and has global pull in, a standardized approach helps people around the world share in the value proposition you offer Cons Global marketing standardization is not sensible in all cases.If people use your products otherwise or if your brand message doesnt work everywhere, you need to be flexible. McDonalds, for instance, has been successful selling its western and American cultural appeal in some countries such as Russia, lacquer and France. However, the fast food string has emphasized its relationship with local suppliers and management in some countries in the nitty-gritty East and elsewhere, where attitudes toward western and Americ an farming are less welcoming. Globalization Pros The main benefit of globalization is that it lets you reach a lot more customers.As long as there is demand in an foreign market for a product or service your business offers, there is a customer base. A product that sells successfully at home will often do well in international markets, says Wesley Johnston, a marketing professor at Georgia State University. Electronics and other technological school products are examples of consumer goods that sell well on the global market. Cons Before taking your business worldwide, make sure there is a market for it. Consumers in other countries often have different preferences and needs and faculty not have very much spare-time occupation in buying your product.For example, if you sell Canadian flags, you might not find much demand in countries outside Canada. another(prenominal) risk of going global is that it can be costly. This is especially true if you set to set up operations in other countries. Finally, different countries have different regulatory standards. Products that can be made and sold freely in some markets might run up against potent regulatory hurdles in other countries. Adaptation Explain the statement, The search for a global advertising campaign can be the spearhead of the search for a coherent global marketing strategy. What types of errors are committed when advertisers attempt to go global? Consumer criticism Deceptive advertising Decency and crying use of sex Self-regulation Government regulations What challenges present international advertisers when they attempt to develop original and media strategies? Language is one of the major barriers to effective communication through advertising shift challenges Low literacy in many another(prenominal) countries octuple languages within a country In-country examination with the target consumer group avoids problems caused by lingual differences ) Can personal selling and sales promotion b e standardized in international markets? What role do promotion and public relations play in international marketing? what are the three sources of personnel department for international assignments and how can U. S. personnel be trained for such assignments? Expatriates- numbers are declining Important for highly technical or involved products High cost Cultural and legal barriers Limited number of high-caliber personnel willing to live oversea Virtual Expatriates- Manage operations in other countries but dont live there Local Nationals authorise both cultural and legal barriers well-known(prenominal) with distribution systems and referral networks Headquarters personnel may ignore their advice Lack of availability Sales positions viewed minusly What are the differences in cultural values that can affect management practices in foreign cultures? How has the profile of global managers changed in recent years? objectivity Separating people from the problem Competitiveness and comparison Nipponese appear to be the best negotiators with the highest profits Japanese appear to be more equitable with buyers Time The rush of time is viewed differently across cultures Describe the negotiation process. Stages 1. Non Task Sounding breed 2. Task related exchange of info Sales Pitch Let the foreign counterparts bring up business Expect a large number of questions but little feedback Allow periods of silence routine multiple communication channels go steady the lack of, or the bluntness of negative feedback Meet aggressive first offers with questions, not anger 3. Persuasion Handling of objectives Task-related entropy exchange versus persuasion cancel threats, warnings, and other aggressive negotiation tactics Avoid emotional outbursts Ask more questions Use third parties and information channels of communication 4. Consensus & agreement The close Write down concession-making strategies Understand differences in decision-making styles In many cultures, n o concessions are made until the end of the negotiations CH 15 International Marketing transmit 8 Describe the difference between traditional, logical implication-oriented distribution systems and modern ones.Page 421 In an imported-oriented or traditional distributution an importer controls a fixed fork out of goods, and the marketing system develops around the philosophy of selling a limited supply of goods at high prices to a humbled number of affluent customers. Describe the current Japanese System how can an international marketer secure a foothold in the Japanese System? modest retailers are considered to be the foundation of the Japanese distribution system. Distribution in Japan has long been considered the most effective nontariff barrier to the Japanese market.What are the pros and cons of using foreign vs. home country middlemen? Foreign Middlemen-Pros-shorter channels and deal with middlemen in constant affair with the market (page 434) Home Country Middlemen-(dom estic middlemen) companies entrust foreign market distribution to others. offering many advantages for companies with small international sales volume, those inexperienced with foreign markets, those not missing to become immediately involved with the complexities of international marketing, and those wanting to sell abroad with nominal financial and management commitment.Con- limited control over the entire process. Page 431 What are the strategic goalthe 6Cs of channel strategy? page 436 COST jacket REQUIREMENTS CONTROL COVERAGE CHARACTER perseveration How should you go about locating, selecting and motivating middlemen? page 438 Locating-productivity or volume, financial strength, managerial stability, and capability, and the record and reputation of the business. Selecting-low volume or low potential volume hampers most prospects, many are underfinanced and some simply cannot be trusted.Motivating- motivational techniques that can be diligent to maintain middlemen intere st and support for the product may be grouped into fivesome categories financial rewards, psychological rewards, communications, company support, and corporate rapport. What is the significance of the internet for international distribution and what issues must a prospective e-vendor consider? page 441 Internet is an important distribution method for multinational companies and a source of products for businesses and consumers. Put the consumer in control of marketing and distribution globally 9What is the purpose of export restrictions? are limitations on the quantity of goods exported to a specific country or countries by a government. Describe the process requisite to determine whether or not an export clear is required? An export license is not required Define and explain the following boycott, free-trade zone (FTZ), maquiladoras, bill of lading, and foreign-freight forwarder. Boycott-is an act of voluntarily abstaining from using, buying, or dealing with a person, organizati on, or country as an human face of protest, usually for social or political reasons.Sometimes, it can be a form of consumer activism. Free-trade zone-customs privileged (In a FTZ, payment of import duties is postponed until the product leaves the FTZ area and enters the country. Page 536 Maquiladora-is the Mexican name for manufacturing operations in a free trade zone (FTZ), where factories import material and equipment on a nontaxable and tariff-free basis for assembly, processing, or manufacturing and then export the assembled, processed and/or manufactured products, sometimes back to the raw materials country of origin.Example inclined in class (Tijuana) Bill of lading-is a document used in the transport of goods by sea. It serves several purposes in international trade. Foreign-freight forwarder-is a person or company that organizes shipments for individuals or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution. Fo rwarders contract with a carrier to move the goods. A forwarder does not move the goods but acts as an practised in supply chain management What is somatogenic distribution (logistics)?Involves more than the physical movement of goods. It includes the location of plants and warehousing, transportation mode, inventory qualities and packing. What is the physical distribution concept? Takes into bank note the interdependence of the costs of each performance a decision involving one activity affects the cost and efficiency of one or all others. Page 449 What are the pros and cons of the different modes of transport available to international marketers?