mkt5 - International Marketing Chapter 5 The Financial...

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    International Marketing International Marketing Chapter 5 Chapter 5 The Financial Environment The Financial Environment
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Credit Policy Credit availability determines sales and the size of sales abroad is determined by: -firm-specific factors such as size, experience in international trade, capacity for financing transactions -degree of economic development -factors related to particular transaction
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The Credit Policy Allows the Exporter To: Determine the extent of risk they are willing to absorb. Explore new ways of financing exports. Prepare for a changing environment.
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Types of Financial Risk Commercial risk Political risk Foreign exchange risk
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Commercial Risk
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Reasons of Commercial Risk: Internal changes in the firm Loss of a key customer Cash flow problems Natural disasters Slow payment by government buyers
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Political Risk
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Foreign Exchange Risk
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Sources of Financing Commercial Banks Forfeiting and factoring Official trade finance Private sector export trade insurance
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Sources: Commercial Banks
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mkt5 - International Marketing Chapter 5 The Financial...

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