Exam 13: Selecting and Managing Entry Modes

Scenario: Sports Stuff Inc. Herb Graham is vice president of Sports Stuff Inc., a business that develops, manufactures, and markets sports products. The company is looking to expand its operations into the European market. Herb believes that if the company expands its product line to include products reflecting sports that are popular in Europe, the company will achieve success there. -Herb knows that much of the success his company enjoys is due to the patents and copyrights that protect the company's products.If Sports Stuff chooses an entry mode in which it grants another firm the right to use its intangible property for a specified period of time,it would be engaging in ________.

What document serves as a title to the goods in question under the document collection payment method?

Discuss the steps companies should take to avoid export and import blunders.How can an advance payment method help exporters reduce financial risk?

Export/import financing in which an exporter ships merchandise and later bills the importer for its value is called ________.

Discuss the advantages of licensing,low-cost production,and low-cost shipping for international companies.

Scenario: Gro-Tru Grows To Europe Gro-Tru, a maker of chemical fertilizers and pesticides, sees enormous growth potential in Central Europe. The company has received several inquiries from potential importers in the region, but in most cases, the potential importers have expressed difficulty in obtaining the hard currency to pay for Gro-Tru's products. Alistair Green, vice-president for business development, is exploring how Gro-Tru can meet the needs of the potential market. -Gro-Tru would be engaging in ________,if it decides that in exchange for a hard-currency sale it would make a hard-currency purchase of an unspecified product from the importing nation in the future.

The primary advantage of franchising is that franchisees have a great degree of organizational flexibility.

Franchising is primarily used in service industries.

Commonly licensed intangible property includes patents,copyrights,special formulas and designs,trademarks,and brand names.

The open account method of export/import financing is used when the two parties are unfamiliar with each other.

Countertrade provides a way for firms to trade either by using a small amount of hard currency or even none at all.

Martin Exporting requests ABC Bank to add its own guarantee of payment to a letter of credit,which creates a(n)________.

The most common method used for buying and selling goods internationally is exporting.

Export/import financing in which a bank acts as an intermediary without accepting financial risk is called ________.

A(n)________ exports products on behalf of an indirect exporter.

Scenario: Gro-Tru Grows To Europe Gro-Tru, a maker of chemical fertilizers and pesticides, sees enormous growth potential in Central Europe. The company has received several inquiries from potential importers in the region, but in most cases, the potential importers have expressed difficulty in obtaining the hard currency to pay for Gro-Tru's products. Alistair Green, vice-president for business development, is exploring how Gro-Tru can meet the needs of the potential market. -In his research,Alistair discovers a type of arrangement in which industrial equipment is exported in return for products produced by that equipment.This arrangement is known as ________.

Which of the following requires an importer to pay for the imported goods when they are delivered?

Agency relationships are popular among exporters because they are easy to terminate should difficulties arise.

Distributors are firms who take ownership of the merchandise when it enters their country.

A ________ extends credit to the importer by requiring payment at some specified time after the importer receives the goods.