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InternationalBusinesschapter131.ppt

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Chapter13selectingandmanagingentrymodesMaincontent1exporting,importing,andcountertradeDevelopinganexportstrategy:afour-stepmodelDegreeofexportinvolvement b):exportmanagementcompanies(EMC) Companythatexportsproductsonbehalfofindirectexporters.Restrictedtoexport-relatedactivities. EMCservices:gatheringmarketinformation,formulatingpromotionalstrategies,performingspecificpromotionalduties,researchingcustomercredit,makingshippingarrangements,coordinatingexportdocuments. Advantage:deepunderstandingofconditionsofthetargetmarket. Disadvantage:hinderthedevelopmentofexporter’sowninternationalexpertise. c):exporttradingcompanies(ETC) Providingimport,exportandcountertradeservices,developingandexpandingdistributionchannel,providingstoragefacilities,financingtradingandinvestmentprojects,andevenmanufacturingproducts. AvoidingexportandimportblundersTypeofcountertradeExport/importfinancingDocumentarycollectionLetterofcredit2contractualentrymodesDisadvantages: a):itcanrestrictalicensor’sfutureactivities.Exclusiveright,failtoproduce,licensorcannotselldirectlyinthatparticularmarketorcontractwithanotherlicensee.Donotguaranteesuccess. b):licensingmightreducetheglobalconsistencyofthequalityandmarketingofalicensor’sproductindifferentnationalmarket. c):licensingmightamounttoacompany“lending”strategicallyimportantpropertytoitsfuturecompetitors.Abetterversionoflicensor'sproductmaybesoldinthemarket,buttheprovisiondoesnotwork.Advantages: a):franchiserscanusefranchisingasalow-cost,low-riskentrymodeintonewmarket. b):franchisingisaentrymodethatallowsforrapidgeographicexpansion. c):franchiserscanbenefitfromtheculturalknowledgeandknow-howoflocalmanagers. Disadvantages: a):franchisersmayfinditcumbersometomanagealargenumberoffranchiseesinavarietyofnationalmarkets.Masterfranchisee:responsibleformonitoringtheoperationsofindividualfranchisees. b):franchiseescanexperiencealossoforganizationalflexibilityinfranchisingagreement.Franchisecontractsarerestricttheirstrategicandtacticaloptions.Manyfranchiseeswor