View
15
Download
1
Category
Tags:
Preview:
Citation preview
OCCASIONAL EXPORTING VS ACTIVE EXPORTING
PASSIVE INVOLVEMENT
EXPORT TAKES PLACE FROM TIME TO TIME DEPENDING ON OWN INITIATIVE
OR IN RESPONSE TO ORDERS FROM ABROAD
ACTIVE INVOLVEMENT
COMMITMENT TO EXPAND INTO A PARTICULAR MARKET
Direct Export
Indirect Export
Licensing Joint Venture
Direct Investment
WAYS TO ENTER A FOREIGN MARKET
These intermediaries include
1) Domestic-based export merchants
2) Domestic-based export agents
3) Cooperative organizations
4) Export-management companies
EXPORT MERCHANTS They buy manufacturer’s product and sell them abroad
EXPORT AGENTSSeek and negotiate foreign purchases and are paid some commission
COOPERATIVE ORGANIZATIONThey carry out exporting activities on behalf of several producers and are partly under their administrative control
EXPORT MANAGEMENT COMPANIESThey manage a company’s export activity for a fee
WHAT ARE THE ADVANTAGES OF INDIRECT EXPORT ?
LESS INVESTMENT The firm need not develop an export department, an overseas sales force etc.
LOWER RISK The intermediaries bring in the advantage of know how and services. This ensures that the seller makes fewer mistakes.
DIRECT EXPORT
It occurs when a manufacturer sells directly to an importer or buyer located in a foreign market.
DIRECT EXPORT
DOMESTIC BASED
EXPORT DIVISION
FOREIGN BASED
AGENTS
TRAVELLING EXPORT SALES
REPRESENTATIVES
OVERSEAS SALES
BRANCH
The licensor issues a license to the licensee to use a manufacturing process, trademark, patent, trade secret and other items of value for a fee or royalty
WHAT IS DIRECT INVESTMENT ?
The purpose of a direct investment is to gain enough control of a company to exercise control over future decisions. This can be accomplished by gaining a majority interest or a significant minority interest. Direct investments can involve management participation, joint-venture or the sharing of technology and skills.
TO KEEP IT STRAIGHT & SIMPLE……
IT IS THE PURCHASE OF A CONTROLLING INTEREST IN A COMPANY OR AT LEAST TO HAVE ENOUGH INFLUENCE TO DIRECT THE COURSE OF THE COMPANY.
JOINT VENTURES
A business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task. This task can be a new project or any other business activity.
In a joint venture, each of the participants is responsible for profits, losses and costs associated with it.
The venture has its own entity, separate and apart from the participants' other business interests.
Direct Investment
Licensing
Joint Ventures
Direct Exporting
Indirect Exporting
Com
mitm
ent,
Risk
, Con
trol
and
Pr
ofita
bilit
y
Recommended