chapter 17 revised

7/27/2019 Chapter 17 Revised

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PowerPoint Presentation by Charlie Cook

The University of West Alabama

Copyright 2006 Thomson Business & Professional Publishing.

All rights reserved.

Part 4 Focusing on the Customer:

Marketing Growth Strategies

Global Marketing


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Copyright 2006 Thomson Business & Professional Publishing. All rights reserved. 173

Small Businesses as Global Enterprises

GlobalizationThe expansion of international business, promoted by

converging market preferences, falling trade barriers,

and the integration of national economies

Size does not limit a firms internationalactivity, and small companies oftenbecome global competitors to takeadvantage of their unique resources.


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Before Going Global

Decide if firm is up to the task of globalization. Study the different cultures, trading systems,

and political and business practices in foreign

markets.

North American Free Trade Agreement (NAFTA)

European Union (EU)

Be prepared to modify products

to meet design specificationsthat may vary from country to

country.


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Forces Driving Global Enterprises

Exhibit 17.2


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Strategy Options for Global Firms

ExportingSelling products in the home country to customers in

another country

Trade mission

A trip organized to help small business owners make directcontact with potential buyers abroad and learn about culturaland regulatory obstacles in foreign markets

Importing

Selling goods produced inanother country to buyers

in the home country


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Strategy Options for Global Firms (contd.)

Foreign LicensingAllowing a company in another country to purchase

the right to manufacture and sell a companys

products in international markets

Licensee The company buying the licensing rights

Licensor

The company selling the licensing rights

Royalties Fees paid by the licensee to the licensor

for each unit produced under a licensing contract


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International FranchisingSelling a standard package of products, systems, and

management services to a company in another

country




International Strategic AlliancesA combination of efforts and/or assets of companies in

different countries for the sake of pooling resources

and sharing the risks of an enterprise



Country Risk Rankings Map

Source: Paul Pedzinksi and Andrew Newby, Risk Improvement Defies Politics, Euromoney, Vol. 35, No. 419, March 2004, pp. 128134. Exhibit 17.5



Challenges to Global Business

Political RiskThe potential for political forces in a country to

negatively affect the performance of businesses

operating within

Economic RiskThe probability that a government will mismanage its

economy and thereby change the business

environment in ways that hinder the performance of

firms operating there Exchange ratethe value of one countrys currency relative to

that of another country


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Assistance for Global Enterprises

Analyzing Markets and Planning StrategiesSmall Business Administration resources

Office of International Trade

U.S. Export Assistance Centers (USEACs)

Publications

Opportunities in Exporting

SBA Guide to Exporting

Department of Commerce

International Trade Administration

Speak to a recent returnee

Visit the foreign country


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Assistance for Global Enterprises (contd.)

Connections With International CustomersTrade Leads

Trade Missions

Trade Intermediaries

An agency that distributes acompanys products on acontract basis to customersin another country

Export management companies

Export trading companies

Export agents, merchants,

or remarketers

Piggyback marketers

chapter 17 revised

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