International Businessandtrade: Exporting and Logistics: Special Issues For Business

I n t e r n a t i o n a l Business and Trade
Exporting
and Logistics:
Special Issues
For Business
McGraw-Hill/Irwin
International Marketing 14/e Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
Global Perspective
An Export Sale: From Trade Show to Installation
• Specific export mechanics occur when goods
are shipped from one country to another
• The Internet has helped speed up process
• Most countries control the movement of goods
crossing their borders – imports and exports
• The international marketer must meet the legal
requirements involved in moving goods from one
country to another
– Export regulations
– Import regulations
15-2
Export Restrictions
• Controlled by the Bureau of Industry and
Security (BIS) of the Department of Commerce
• Export Administration Regulations
– Serve the national security, foreign policy, and
nonproliferation interests
– Includes some export controls to protect the U.S. from
the adverse impact of the unrestricted export of commodities
in short supply
• NLR (no license required)
15-3
Determining Export Requirements
• Exporter must determine the appropriate
license for the product (general or validated)
– Export Control Classification Number (ECCN)
– Commerce Control List (CCL)
– End-use restrictions
– Determination of ultimate end customer and ultimate end
uses of the product
• Details of exporting must be followed to the
letter
15-4
ELAIN, STELA, ERIC, and SNAP
• ELAIN ( Export License Application and
Information Network)
• STELA (System for Tracking Export License
Applications)
• ERIC (Electronic Request for Item Classification)
• SNAP (Simplified Network Application Process)
15-5
Import Restrictions
• Tariffs
• Exchange permits
• Quotas
• Import licenses
• Standards
• Boycotts
• Voluntary agreements
• Other restrictions
15-6
Terms of Sale
• CIF (cost, insurance, freight)
• C&F (cost and freight)
• FAS (free alongside)
• FOB (free on board)
• EX (named port of origin)
15-7
Getting Paid –
Foreign Commercial Payments
• Letter of credit
– Afford the greatest degree of protection for the seller
– Can be revocable or irrevocable
– Not a guarantee of payment to the seller
• Bills of exchange
– Also known as dollar drafts
► The seller assumes all risk until the actual dollars are received
– Sight draft
– Arrival draft
– Date draft
15-8
Getting Paid –
Foreign Commercial Payments
• Cash in advance
– Places unpopular burdens on the customer
• Open accounts
– Not generally made in foreign trade
– Leaves sellers at a disadvantage
• Forfaiting
– Seller makes a one-time arrangement with a financial institution
to take over responsibility for collecting the account receivable
15-9
Packing and Marking
• Export packaging must consider:
– Protection against rough handling, climate, pilferage
– Effect of gross weight on import fees
• All countries regulate the marking of imported
goods and containers
– All markings must conform exactly to the data on the
export documents
• Preparing shipment to (Country) details:
– Necessary export documents
– Regulations for labeling, marking, packing, and customs
procedures
15-10
Customs-Privileged Facilities
• Customs-privileged facilities
– Areas where goods can be imported for storage and/or
processing with tariffs and quota limits postponed until the
products leave the designated areas
• Foreign trade zones (FTZs)
– Drawback
• Offshore assembly (Maquiladoras)
– Originated in Mexico in the early 1970’s
– NAFTA
15-11
Logistics
• Logistics management
– Total systems approach to management of the distribution
process
► Physically moving raw material
► In-process inventory
► Finished goods inventory from the point of origin to the point of use or
consumption
15-12
Interdependence of Physical
Distribution Activities
• Physical distribution system
– Physical movement of goods
– Location of plants and warehousing (storage)
– Transportation mode
– Inventory quantities
– Packing
• Interdependence of the costs of each activity
– A decision involving one activity affects the cost and efficiency of
one or all others
– Sum of each of the different activity costs entails an infinite
number of “total costs”
15-13
Benefits of a Physical
Distribution System
• Cost advantages
• Optimal inventory levels
• Optimal production capacity
• More dependable delivery service to the market
• Can render natural obstructions created by
geography less economically critical for
multinational marketer
15-14
Export Shipping and Warehousing
• Rail
Common
transportation
shipping modes
• Complete
– Ocean shipping
logistics management services
– Airfreight
– UPS
– Air express
– FedEx
– Parcel post
•• Merge-in-transit
Containerization
• Intermodal services
• Intermodal marketing companies (IMCs)
15-15
Foreign Freight Forwarder
• Licensed by the Federal Maritime Commission
• Arranges for the shipment of goods as the agent
for an exporter
– Arranges for complete shipping documentation
– Provides information and advice on routing and scheduling,
rates and related charges, consular and licensing requirements,
labeling requirements, and export restrictions
– Offers shipping insurance, warehouse storage, packing and
containerization, and ocean cargo or airfreight space
15-16
International Logistics
and Supply Chain Management
• Information technology now allows
communication with participants in real time via
a single connection point
• NetLinx
• Descartes
• 3PL providers or integrators
– UPS Logistics Group
15-17
Terrorism and Logistics
• Cargo and Container Security Initiative (CSI)
– 24-hour rule
• Customs-Trade Partnership against Terrorism
(C-TPAT)
– Augments the 24-hour rule by extending security procedures throughout the
supply chain
– Only applies to U.S. importers
• Electronic tracking (C-TPAT-Plus)

– RFID
– GPS
– Cellular
– Satellite
– Ultra-wide-band
– Bluetooth
– Bar codes
– Optical character recognition
15-18

International Businessandtrade: Exporting and Logistics: Special Issues For Business

Uploaded by

Copyright:

Available Formats

International Businessandtrade: Exporting and Logistics: Special Issues For Business

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

International Businessandtrade: Exporting and Logistics: Special Issues For Business

Uploaded by

Copyright:

Available Formats

I n t e r n a t i o n a l Business and Trade

• Electronic tracking (C-TPAT-Plus)

You might also like