chapter 12 international logistics. © 2008 prentice hall 12-2 learning objectives f to identify the...
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© 2008 Prentice Hall 12-2
Learning Objectives
To identify the reasons for governmental intervention in the area of international trade
To distinguish among the unique activities of international trade specialists
© 2008 Prentice Hall 12-3
Learning Objectives
To examine issues involved in international air transportation
To relate activities involved in international ocean transportation
© 2008 Prentice Hall 12-4
International Logistics
Key Terms
– Customs house brokers
– Export management company
– Export packers
Key Terms
– Export trading company
– Import quotas
– Incoterms 2000
© 2008 Prentice Hall 12-5
International Logistics
Key Terms– International Air
Transport Association (IATA)
– International freight forwarders
– Irrevocable letter of credit
– Land bridge
Key Terms– Nontariff barrier– Nonvessel-
operating common carrier (NVOCC)
– Shippers associations
– Shipping conferences
© 2008 Prentice Hall 12-6
International Logistics
Changes to political landscape affect logistics– The end of Soviet rule in Eastern Europe– EU economic integration
Nontariff barriers-a rule that has the effect of reducing imports
Restrictions on truck traffic, forcing freight onto rail and water
– NAFTA Multinational firms
© 2008 Prentice Hall 12-7
International Marketing
Size or scale of firms may be different Firms selling products under their own brand
are concerned about quality maintenance Consumer preferences differ International credit system is not well
developed– Irrevocable letter of credit
© 2008 Prentice Hall 12-9
International Marketing Channels
Domestic (U.S.) channels– Ownership– Negotiations– Financing– Promotions– Logistics
International channel additions– Documentation
© 2008 Prentice Hall 12-10
Terms of Sale—Incoterms 2000
EX-Works (EXW) FCA (Free Carrier) FAS (Free Alongside
Ship) FOB (Free on Board) CFR (Cost and Freight) CPT (Carriage Paid To) CIF (Cost, Insurance, and
Freight)
CIP (Carriage and Insurance Paid To)
DES (Delivered Ex Ship) DEQ (Delivered Ex Quay) DAF (Delivered at
Frontier) DDP (Delivered Duty
Paid) DDU (Delivered Duty
Unpaid)
© 2008 Prentice Hall 12-11
Government Influences on Foreign Trade
Government controls on the flow of international trade– Customs or duties– Import quotas– Health inspections– Safety standards– Currency outflow– Political or military reasons– Port choice– Non-trade reasons
© 2008 Prentice Hall 12-12
Government’s Role in International Transport
International carriage is an export to the nation operating the carrier-affects balance of payments
International fleets and airlines may be subsidized
Large nations must protect their flag carriers’ interests
© 2008 Prentice Hall 12-13
International Trade and Supply Chain Specialists
International Freight Forwarders– Advising on acceptance of letters of credit– Booking space on carriers– Preparing an export declaration– Preparing an air waybill or bill of lading– Obtaining consular documents– Arranging for Insurance– Preparing and sending shipping notices and
documents– Serving as general consultant on export matters
© 2008 Prentice Hall 12-14
International Trade and Supply Chain Specialists
Nonvessel-operating common carrier (NVOCC)
Customs house brokers Export management company Export trading company Shippers associations
– Shipping conferences Export packers
© 2008 Prentice Hall 12-15
Figure 12-4: A Forwarder’s
Export Quotation Sheet Showing
Factors to Include When Determining a Price Quote
© 2008 Prentice Hall 12-17
Logistics Channels in International Distribution
Landward move to the port or airport in exporting country
International air International ocean shipping Landward leg in importing country
© 2008 Prentice Hall 12-18
Movement to Port or Airport
To adjacent countries, move is similar to domestic, with more paperwork
To ports– Use containerization
– Land bridge operations
To airports– Chartered aircraft
– Scheduled air carriers
– Integrated air carriers
– International Air Transport Association (IATA)
© 2008 Prentice Hall 12-20
Ocean Shipping
Types of Ocean Cargo– Petroleum– Dry-bulk cargoes-grain, ores, sulfur, sugar,
scrap iron, coal, lumber, logs in vessel loads– Containers
Shipping conferences and alliances pool resources and extend market coverage
© 2008 Prentice Hall 12-21
Ocean Shipping
Types of Vessels– Containerships– Lighter aboard ship (LASH) vessels – Roll On-Roll Off (RO-RO) vessels– Tankers– Parcel Tankers– Tramps– Specialized vessels
© 2008 Prentice Hall 12-23
Surface Transport in Importing Countries
Few foreign nations have as wide a range of modes as in the United States
Transportation nationalization is higher in most countries other than the United States
Ship owners are becoming involved in land transport
Short sea shipping along coasts Rail gauges vary around the world
© 2008 Prentice Hall 12-24
International Trade Inventories
May vary in small ways from country to country—products may be tailored to fit
Less is needed (than in U.S.) to serve any one country
Return items are impossible to accommodate Import and export quotas affect value of
inventories Currency and language differences
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