Class #2: Organisation and structure, exports

How does Porter’s supplier power apply at international level?

When suppliers control supply or prices globally, they gain strong bargaining power.
Example: OPEC controlling oil vs US fracking reducing dependency.

Why are new entrants a major strategic risk today?

Because large digital players can enter any industry very fast.
Examples: Alibaba moving from B2C to B2B; Amazon entering pharmaceuticals.

What does PESTEL stand for?

Political, Economic, Sociological, Technological, Ecological, Legal.

Why is PESTEL essential in international business?

It analyzes the environment today and tomorrow to identify opportunities and threats.

What is pull marketing?

A market-driven approach that starts from consumer needs, not the product.

What are the four strategic actions in pull marketing?

Listen → Understand → Anticipate → Analyze.

What is the marketing wheel?

A continuous process linking market insights to business performance.

What are the main stages of the marketing wheel?

Market insights → Strategy → Strategic choices → Offer building → Action plans → Operations/Sales → Customer perception → Business analysis.

Why is customer perception central in the wheel?

Because it directly feeds back into strategy and performance.
Example: Video game industry constantly adapting to player feedback.

What are the main ways to structure an international sales organization?

By geography, product, market/industry, or customer/account size.

When is product-based organization preferred?

For technical products requiring expertise.
Example: Satellites.

What is the major risk of product/service organization?

Silo effect — poor communication across regions.
Example: Pharmaceutical industry.

What is customer/account size organization?

Structuring around key accounts, especially multinational clients.

Give an example of customer/account organization.

McCain supplying McDonald’s globally.

How is an export department structured in a small company?

Export manager + export assistant.

How does it evolve in medium companies?

Area managers per region or continent.

How is it structured in large multinationals?

Regional directors, area managers, regional offices, and international Key Account Managers (KAMs).

What is a merchant exporter?

A company that buys, stores, and exports products to foreign markets.
Usually a country specialist.

What is an export commission house?

A company representing a foreign exporter in your domestic market.
Example: Samsung.

What is the role of a broker?

Connects two companies without owning the goods.
Used in complex markets or commodities.

Give an example of broker use.

Give an example of broker use.

What does a manufacturer export agent do?

Acts on behalf of the producer to develop foreign sales.

What is barter in international trade?

Product-for-product exchange, often via an intermediary.
Used in difficult economic situations.

What is an importer-distributor?

Buys goods, handles customs, stores and resells locally.

Why is importer-distributor good for B2C products?

Because they manage local logistics and retail — but they are your customer, not the end user.

What is an export agent?

Negotiates with customers but never owns the goods.
Customer pays you; agent earns commission.

When is an agent best used?

For B2B markets requiring direct relationship with end clients.

What is an SKU?

Stock Keeping Unit — a unique product reference.

What is a foreign subsidiary?

A company abroad, 100% owned by the parent firm.

What is the legal risk when ending an agent contract?

Compensation — often one year of commission.

What is a joint venture?

Creation of a company with a local partner, sharing ownership.

Why are joint ventures sometimes mandatory?

Legal restrictions in certain countries.
Examples: China, India.

What are the risks of joint ventures?

Conflicts of vision, loyalty issues, control problems.

What factors determine entry mode choice?

Market potential + political/economic stability.

When is a subsidiary preferred?

In rich, stable, high-potential countries.

Why is Nigeria a good example of a dilemma?

High growth potential but high risks (terrorism, corruption).

What questions must be answered before entering a foreign market?

• Is there a market?

• Who are the customers?

• PESTEL context?

• Local competition?

• Costs?

What is a brand?

A name or symbol used to identify and differentiate products from competitors.

Why did branding start historically?

Illiteracy → need for symbols; marking ownership (animals, goods, humans).

Why do brands exist today?

Identification, legal protection, quality signal, competitive advantage, price premium.

What is brand identity?

What is brand identity?

What is brand image?

How consumers perceive the brand.

What is brand positioning?

The place the brand wants to occupy in consumers’ minds.

What is brand equity?

The financial value of the brand.

How many phases of branding are there ?

3

What is the promise phase?

Expectations before consumption.

What is the experience phase?

How the brand is actually lived by the customer.

What is the memory phase?

Long-term perception, reputation, word of mouth, and NPS.

What is the core exam message of this class?

Successful international branding and exporting require strategic market analysis, the right organizational structure, appropriate entry mode, and consistent brand experience.