Countertrade The diversity of this nation permits interchanges to occur worldwide through Countertrade. Think of what the world would be like if one never experienced the opportunity to share the exchange of a diverse range of products from other countries through countertrade. In this paper‚ the author will define Countertrade‚ describe how countertrade is used in global financing operations and then explain the importance of managing risk. Define Countertrade Countertrade is defined by
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for Russian Sukhoi fighter aircraft. This trade‚ like others that fall under the umbrella term countertrade‚ illustrates that buyers and sellers often find creative ways of settling pay¬ment for imports and exports. Countertrade refers to any one of several different arrangements that parties negoti¬ate so that they can trade goods and services with limited or no use of currency. Technically‚ countertrade can be divided into two basic types: barter‚ based on clearing arrangements used to avoid money-based
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certain risks that need to be kept in mind‚ mainly the possibility of losing specialized technology and competitive advantages deriving from the seller firm’s specific production capabilities. To avoid these risks‚ exporters seeking to enter into countertrade agreements are advised to communicate effectively and clearly with their customers‚ setting realistic offset commitments‚ being proactive to take advantage of offsets serving as a marketing platform‚ and by better planning their technology sharing
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fixin * Indirect policy influences: inflation‚ interest rates International Pricing Issues * Currency exchange‚ Country pricing relationships‚ channel issues‚ multiple price schedule‚ terms of sale‚ transfer pricing‚ gray mkts‚ dumping‚ countertrade * Cost escalation to buyer: packaging‚ handling‚ shipping‚ duties‚ taxes‚ fees Transfer Pricing * The price paid by another part of the organization when the product crosses national borders (or internal org. boundary) 1. Market based:
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technology. 10. It is also observed that within the service sector strategic alliances are less common‚ but those between hotels‚ airlines and tour operator’s and between accountants and management consultants are increasing. COUNTERTRADE: Countertrade is a form of international trade in which certain export and import transactions are directly linked with each other and in which import of goods are paid
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Description of the Organization Megahertz Communications is a U.K based company that specializes in the building of broadcasting systems. Created in 1982‚ Megahertz designs‚ manufactures‚ and installs TV and radio broadcasting systems. They also build broadcasting and news-gathering vehicles with satellite links. Megahertz builds everything in-house‚ from satellite trucks to custom desks and cabinets used in newsrooms. Megahertz International was set up by Ashley Coles in 1998 as an international
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Part IV. The global marketing mix 2. Global pricing strategy 1 Cheap and cheaper… 2 Expensive and more expensive… 3 1. Basic pricing concepts Introduction Price: the amount charged to customers/consumers in exchange for goods or services Market price: the price that prevails in the market for a particular good at a specific time 3 key elements of market price: supply‚ demand and time Eg: hotel prices – peak season during summer – higher prices driven by the demand (more
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Chapter 13 Exporting‚ Importing‚ and Countertrade True / False Questions 1. (p. 439) Firms that export lose out on opportunities of profit and revenue. Topic: The Promise and Pitfalls of Exporting FALSE AACSB: Analytic BT: Knowledge Difficulty: Easy Learning Objective: 13-1 2. (p. 439) Studies have shown that while small firms tend to be proactive about seeking opportunities for profitable exporting‚ systematically scanning foreign markets to see where the opportunities
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Chapter 13 Student: ___________________________________________________________________________ 1. As an exporter‚ according to the opening case‚ which of these is a key problem for Megahertz Communications? A. Credibility of foreign governments B. Financing C. Substandard products for foreign markets D. Language E. Country specific technical standards 2. In the United States‚ what percent of firms export‚ according to the U.S. Small Business Administration? A. Nearly 98 percent B. About 23 percent
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favorable method for importers. a. True b. False 8. 13-067 (Points: 4.0) Which of these is the most common method of buying and selling goods internationally? a. Exporting and importing b. Contractual entry c. Countertrade d. Investment entry 9. 13-059 (Points: 4.0) Generally‚ a joint venture exposes fewer of a partner’s assets to
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