IBUS1101 Lecture Notes - Lecture 9: Emerging Markets, Third-Party Logistics, Sweatshop

• School: University of Sydney
• Department: International Business
• Course: IBUS1101
• Professor: Sidney Gray

Document Summary

Exporting trade, trade deficit, trade surplus. Independent distributor/agent: fir(cid:373)"s o(cid:449)(cid:374) (cid:373)arketi(cid:374)g su(cid:271)sidiar(cid:455) a(cid:271)roaded. Services can be exported architecture, education, accounting, entertainment, information etc. So(cid:373)e (cid:272)a(cid:374)(cid:374)ot (cid:271)e(cid:272)ause the(cid:455) (cid:272)a(cid:374)"t (cid:271)e tra(cid:374)sported. Most retailers offer services through establishing retail stores abroad (fdi) requires direct contact with customers. Overall, most services done via other entry strategies than exporting (e. g. fdi) Minimise cost of foreign market entry +risk. Leverage capabilities of foreign distributors + other business partners abroad. Fewer opportunities to learn about customers, competitors, other aspects of foreign markets (compared to fdi) Firm must acquire + dedicate new capabilities in international sales contracts + transactions, international financing methods, logistics and documentation strain organisational resources. Exposes firm to tariffs/trade barriers + fluctuating exchange rates. Indirect exporting: co(cid:374)tra(cid:272)ti(cid:374)g (cid:449)ith a(cid:374) i(cid:374)ter(cid:373)ediar(cid:455) i(cid:374) fir(cid:373)"s home country to perform all export functions (often export management company or a trading company common among firms new to exporting)