Chap013 - Chapter 13 Chapter 13 Exporting, Importing, and...

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Unformatted text preview: Chapter 13 Chapter 13 Exporting, Importing, and Countertrade 13-2 Introduction Question: What type of firm benefits from exporting? Both large and small firms can benefit from exporting The volume of export activity in the world economy is increasing as exporting has become easier thanks to the decline in trade barriers under the WTO regional economic agreements such as the European Union and the North American Free Trade Agreement 13-3 Introduction Question: What do firms that want to export need to do? Firms wishing to export must identify export opportunities avoid a host of unanticipated problems associated with doing business in a foreign market become familiar with the mechanics of export and import financing learn where to get financing and export credit insurance learn how to deal with foreign exchange risk 13-4 The Promise and Pitfalls of Exporting Question: What are the benefits of exporting? The benefits from exporting can be great--the rest of the world is a much larger market than the domestic market Larger firms may be proactive in seeking out new export opportunities, but many smaller firms take a reactive approach to exporting Many novice exporters have run into significant problems when first trying to do business abroad, souring them on following up on subsequent opportunities 13-5 The Promise and Pitfalls of Exporting Question: What are the pitfalls facing exporters? Common pitfalls for exporters include poor market analysis poor understanding of competitive conditions a lack of customization for local markets, poor distribution arrangements, bad promotional campaigns a general underestimation of the differences and expertise required for foreign market penetration difficulty dealing with the tremendous paperwork and formalities involved 13-6 Improving Export Performance Question: How can exporters improve their performance? To improve their success, exporters should acquire more knowledge of foreign market opportunities consider using an export management company adopt a successful export strategy 13-7 An International Comparison Many firms fail to consider export opportunities simply because they lack knowledge of the opportunities available Both Germany and Japan have developed extensive institutional structures or promoting exports Japanese exporters can also take advantage of the knowledge and contacts of sogo shosha , the countrys great trading houses 13-8...
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This note was uploaded on 04/23/2011 for the course ECON 103 taught by Professor Econ during the Spring '11 term at Universitas Katolik Parahyangan.

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Chap013 - Chapter 13 Chapter 13 Exporting, Importing, and...

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