IBA 460 TEST 2

export management

type of indirect exporting, normally located in exporting country, acts as representative for the exporter abroad, but never takes title to the goods. Acts as a facilitator by helping exporter find buyers and earns commission on sale. Requires more involvement by exporter

export trading companies

firm with offices in multiple countries that purchases goods in one country and resells them in another. Domestic transactions

contract manufacturing

company enters into an agreement with a foreign company to manufacture its goods abroad EX. American publisher may hire a British publisher to print books in Britain, instead of shipping them from the US, way for firms to get its products in a foreign country, either when there are barriers to entry or high transportation costs

indirect exporting

exporter does not seek sales, allows manufacturer to concentrate on domestic market and leave exporting to experts, EX: EMC, Export trading company, piggyback exporting, domestic distributors and gray markets

direct (active) exporting

exporter actively participates in finding potential markets abroad best option for large firms or firms with international experience, progression of direct entry modes, greater investment required than indirect exporting, time to market may be higher, higher risk

indirect benefits

no int'l experience required, management not distracted, faster to int'l market, little to no increased financial commitment, low risk

indirect disadvantages

poor control wrong market, wrong distributor, inadequate market feedback, potentially lower sales, high risk

benefits of direct

direct control, excellent feedback, greater sales

direct disadvantages

greater investment required than indirect exporting, time to market may be higher, higher risk

piggyback exporting

refers to the possibility of a small firm riding on another firm's efforts to enter a foreign market. EX: a firm utilizes another company's distribution channels abroad to sell its products. Uses another company's experience to sell it's products abroad

foreign agent

small firm or individual located in the importing country. Will act as a representative of the exporter. He/She will not take title of the goods and will earn a commission from the exporter. Will represent multiple companies manufacturing products that complement the exporter's products

distributor

located in importing country, will purchase goods from the exporter and therefore take title of them. It will then resell the goods for a profit

parallel imports

buying goods in the country with the lowest price, and then sell them in the country with the highest price. They buy from the normal distribution channel, but sell through alternative channels of distribution that are not ones exporters would normally use, difficult for countries to fight because they are due to market characteristics rather than strategic choices

FCL & LCL

shipping term for volume not weight

TEU

twenty foot equivalent unit, intermodal transportation, containerization- dry, reefer, high cube, flat rock

breakbulk cargo

cargo that is packaged (bales, boxes, drums, crates) but not containerized, vehicles are also considered this type of cargo, cheaper to move

container cargo

cargo that's placed in containers before it's loaded onto a ship, metallic boxes, 20ft. and 40ft.

panamax

ship of the max. size that can enter the locks of the panama canal

post-panamax

ship that's too large to enter the locks of the panama canal

scheduled air freight

transported by airlines that operate on regular schedule b/w 2 cities. Airline can operate on passenger aircraft, cargo is in belly of the plane, in freighter cargo is placed on main deck

chartered air frieght

do not operate on main schedule and depend on demand, fulfill emergency shipments of large parts, or operate on seasonal traffic such as wine, flowers, or fruit

Shipper's export declaration (SED)

a data collection document, used to tabulate what products are exported from the US and to which countries they are exported

Electronic Export Info (EEI)

replaced SED, required when: shipment of merchandise under the same schedule B commodity # is valued at more than $2500 and is sent from the same exporter to the same recipient on the same day, merchandise requires an export license, subject to ITAR

AES: Automated Export System

EEI's are submitted via this, administered by the US census bureau, 3 options, AES direct, AES pelink, AES weblink + EDI

ACE: Automated Commercial Environment

will become the single window -- the primary system through which the trade community will report imports and exports and gov't will determine accessability

consular invoice

a commercial invoice that's printed on stationary provided by the consulate of the country in which the good will be imported

certificate of origin

a document provided by the exporter's chamber of commerce that attests that the goods originated from the country in which the exporter is located, use it to determine the import tariff

phyto-sanitary certificate

attests that agricultural goods are free of pests and disease and conform to the standards of the importing country

certificate of analysis

attests that the goods conform to the chemical description and purity levels contained in the invoice provided by the exporter

role of freight forwarder

quote and secure freight costs, book cargo with carrier, prepare documents for export, inland routing and documentation, insurance, inventory control, logistics management, transaction based industry

dunnage

blocking materials used to package or stabilize cargo

demurrage

occurs when vessel is prevented from loading or discharging cargo with in the stipulated laytime; refers to the charges that the charterer pays to the ship owner for its extra use of the vessel

stevedore

dock worker or long shoreman who is responsible for loading/unloading cargo onto the ship

plimsoll mark

load lines indicate how heavily a ship can be loaded, and this shows classification society of the ship

land bridge

intermodal transportation EX. ocean shipment from Beijing to Seattle, by rail to Newark, by ocean to Galway, Ireland

bill of landing

used to describe document that fulfills 3 functions in int'l transport, it's a contract b/w the carrier and the shipper, carrier agrees to transport goods from A to B for a price, it's a receipt for the goods- signifies goods were received in good condition, it's a certificate of title- whichever party has the original is owner of goods

airway bill

when the goods travel by air

importer security filing (10 + 2 rule)

pre-shipment notifications, in the US it's called this, all cargo manifests must be sent to CBP at least 24 hours before the cargo is to arrive in the US. Importer is responsible for the filing, failure to comply is $10,000 fine / shipment

flag of convenience

flags that have low costs and few regulations, most countries have open registry which are convenient to ship owners

CGBP Certified Global Business Professional

people use it because it provides professional development goal, assists with hiring even if not a requirement, raises level of practice

global business management, global marketing, supply chain management, trade finance

what are the 4 primary domains of CGBP

search engines can't see the translated content and will miss keywords

why is it a bad idea to use on the fly machine translation on websites?

INCOterms

deal with the identification of the physical location in which the supply chain where risk of loss or damage to the goods and obligations for transportation customs and related costs shift from seller to buyer, says which tasks will be performed by the importer or exporter, and which activities will be paid for by importer/exporter

International Commerce Terms

what does the abbreviation INCOTerms stand for?

variable costing

only costs allocated to products are those directly related to production of product, doesn't include nonmanufacturing costs like overhead, marketing, executive compensation, etc.

full absorption

includes manufacturing costs (variable and fixed) plus nonmanufacturing costs like overhead, marketing, etc.

ProForma invoice

your offer used to negotiate order, establishes main elements of transaction, description of merchandise, quantity, packaging, price, point of delivery, date of delivery, payment terms