international business sem iiil

8/7/2019 International Business Sem IIIl

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G.K.Tripathi 1

International MarketingManagement- Specilaization

Bhartiya Vidya Bhavan


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G.K.Tripathi 2

Setting up an appropriate business

Organization

Sole Proprietor

Partnership

Private Limited

Public Limited

Based on

Finance

Risk Bearing

Control over business


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G.K.Tripathi 3

Registration for Export / Import

IEC Code DGFT after 1997

Registration with respective export

promotion councils

- APEDA, AEPC,CEPC

Registration with Sales tax Registration with Central Excise

PAN


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G.K.Tripathi 4

Selection of appropriate business

mode

Merchant Export

Manufacturer Exporter

Sales Agent/ Commission Agent

Buying Agent


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G.K.Tripathi 5

International Business contracts

Export Contracts Main features

To Avoid disputes

Carefully Comprehensive draft

Precise & Relevance trade deal


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G.K.Tripathi 6

International Business contracts1.Product, Standard &

specification

2.Quantity

3.Inspection

4. Total Value of theContract

5.Terms of Delivery

6.Taxes/ Duties/charges

7.Period of Delivery/Shipments

8. Packing/ Labeling/

Marking

9. Terms of payments

10. Discount& commissions

11. License & Permits12. Insurance

13. DocumentaryRequirements

14. Guarantees

15. Force Majeure/ nonperformance

16. Arbitration


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G.K.Tripathi 7

International Commercial

Practices ICC , Paris

1. UCP Uniform customs and practices on

documentary credit ( 1994)

2. INCO Terms 1990

Various Trade terms in export

-import transactions


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G.K.Tripathi 8

INCOTERM

S INCOTERMS by ICC, Paris in 1990

There are 13 INCOTERMS which specify :

- Transfer of risk : Risk of loss & Damage- Transfer of Obligation

1. EXW Ex Works

2. FCA Free Carrier

3.F

OB F

ree on Board4. FAS - Free alongside ship

5. CFR Cost and Freight

6. CIF- Cost, Insurance and Freight


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G.K.Tripathi 9

INCOTERM

S7. CPT Carriage Paid to

8. CIP Carriage and Insurance paid to

9. DAF delivered at Frontier

10. DES Delivered ex-ship

11. DEQ Delivered ex-Quay12.DDU Delivered Duty Unpaid

13.DDP Delivered Duty Paid


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G.K.Tripathi 10

Business Risk Coverage

ECGC

4 Types of Risks in International Trade

1.Credit Risk

2. Currency Risk

3. Carriage Risk

4.CountryRisk

Credit Risk

ERIC 1957

ECGC - 964


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G.K.Tripathi 11

BusinessR

isk Coverage Commercial Risk

Insolvency of the Buyer

Failure of buyer to make payment due within aspecified period

Buyers failure to except the goods

Political Risk

Imposition of restrictions by the buyers country

War, civil war or civil disturbances

Interruption or diversion of voyage


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G.K.Tripathi 12

Role of ECGC

Maximum Liability 24 months

Credit limits on buyer

Restricted cover countries- 57 Coubtries

Small Exporters Policy 25 Lakhs

Guarantees to BANKS

1. Packing Credit Guarantee2. Export Production Finance guarantee

3. Post-shipment Export Credit Guarantee


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G.K.Tripathi 13

Role of ECGC

4. Export Finance Guarantee

5. Export Performance Guarantee

6. Export Finance ( Overseas lending ) Guarantee

ECGCs Advice on Foreign Credit 28

information Agencies are involved for providingCredit report.

Comprehensive & Specific Policy


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G.K.Tripathi 14

Organizing Export Finance Pre shipment Finance

Packing Credit

Advance against Cash IncentivesAdvance against duty drawback entitlement

Post shipment Finance

Negotiations / payments/acceptance of docs underL/C

Purchase/ discount of export docs

Advance against bills sent for collection basis

Advance against Exports on consignment basis


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G.K.Tripathi 15

Organizing Export FinanceAdvances against undrawn balances

Advance against Cash incentives

Advance against Duty Drawback

entitlements

Advance against retention money

Finance Exports against deferred payments

arrangements, turnkey projects etc.


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G.K.Tripathi 16

Export Finance Purpose and need Oriented

Objective

> Purchase of raw material and other inputs

Processing

Manufacturing

PackingTransportation

Warehousing


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G.K.Tripathi 17

Managing Foreign Exchange

-Regulations & Formalities

FERA 1973- Export Declaration

Types of export declaration forms

1. GRForm2. PP Form

3. VP/COD

4. SOFTEX

Exempted Exports

1. < 25000/-

2. Thru AD


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G.K.Tripathi 18

Foreign Exchange Facilities Exporter can open EEFC & FCA

Specially to NET Foreign Exchange earner

Export discipline realization of export proceeds :1. Export on elongated credit terms

2. Trade discounts

3. Advance remittance

4. Part drawings

5. Reduction in Value

6. Write off of unrealized export bills


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G.K.Tripathi 19

International Marketing International Marketing has 3 basic

elements :

1. Identifying the needs

2. Stimulation of the needs

3. Satisfying the need


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G.K.Tripathi 20

International MarketingTrading Blocks

1. EEC -European Economic Community

2. EFTA European Free Trade Association

3. LAFTA Latin America Free Trade Association

4. ASEAN Association of South- East Asian

Nations5. COMECON Council for mutual economic

assistance


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G.K.Tripathi 21

International Marketing Exploring the world Market

Market Survey

1. Product Oriented Studies

2. Market Oriented studies


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G.K.Tripathi 22

International MarketingThe successful marketing of a product

depends on the knowledge of three vital

factors :

1. The target customers of the market

2. The distribution system

3. Competitive activity


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G.K.Tripathi 23

International Marketing Valuable information regarding market

can be obtained :

1. International Agencies2. Chamber of commerce & Trade

associations

3. Indian Mission abroad4. Foreign banks & National Banks

5. Government agencies


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G.K.Tripathi 24

Marketing strategy/ plan Once the market product configuration has

been identified, the next step is to take

decision on various aspects of marketingmix like :

1. Product 4. Distribution

2. Pricing 5. Promotion

3. Delivery 6. Packaging


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G.K.Tripathi 25

Marketing strategy/ planA good marketing strategy would be one which

motivates the target consumer to take purchasing

decision on the product . Decision makingprocess for marketing involves :

1. Awareness

2. Knowledge

3. Intention

4. Action


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G.K.Tripathi 26

International Marketing Inn international Field trade is regulated by

:

1 . Tariff barriers

2. Non- Tariff barriers

3. Trade Agreements

4. Trade Blocks


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G.K.Tripathi 27

International Marketing1. Tariff barriers

a. Duties

b. Specific Duties

c. Anti Dumping Duties

2. Non Tariff

Foreign Exchange restrictionsPreferential agreements

Quantity restrictions


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G.K.Tripathi 28

Export Marketing PlanMarket size & trends

Market structure

Competition

Products

Pricing

Marketing channels & Promotion

Buyer behaviorMarketing Communication

Establishing a competitive advantage


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G.K.Tripathi 29

Export PricingInternational Freight

Insurance Charges

Product Adaptation cost

Import Duties

Commission for import agents

Foreign Exchange risk coverage


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G.K.Tripathi 30

Export PromotionPublicity Methods

Advertising

Trade Missions

Buyers visit

Others promotional activities for effectivecustomer support


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G.K.Tripathi 31

Locating the prospective BuyersMarket selection Criteria

Socio- political factors

Economic factors

Cultural factors

Technological factors

Climate


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G.K.Tripathi 32

Export Marketing Mix7 Ps

1.Product

2. Packaging

3. Price

4. Promotion

5. Personnel selling6. Publicity

7. Physical Distribution & Advertising

international business sem iiil

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