Exam 13: Selecting and Managing Entry Modes

Scenario: Sports Stuff, Inc. Herb Graham is vice president of Sports Stuff, a business that develops, manufactures, and markets sports memorabilia. The company is looking to expand its operations into the European market. Herb believes that if the company expands its product line to include products reflecting sports that are popular in Europe, the company will achieve success there. -If Sports Stuff wants to hire a company to design, construct, and test a production facility on its behalf, the company might consider a ________.

Scenario: Wang's Techno Toys Ann Wang has been successful in the domestic market selling high-tech toy products. But facing stiff competition at home, Ann has entered international markets by direct exporting. -If Ann's bank acts as an intermediary without accepting financial risk it is called ________.

The sale of goods and services to a country by a company that promises to make a future purchase of a specific product from that country is called a(n) ________.

The primary advantage of franchising is that franchisees have a great degree of organizational flexibility.

A company establishing relationships with potential local distributors, buyers, and others is at which step in the export process?

Which of the following influence(s) the choice of intermediary for indirect exporters?

The open account method of payment ________ the risk of nonpayment for the exporter relative to other financing methods.

Export/import financing in which a bank acts as an intermediary without accepting financial risk is called ________.

Which of these requires the importer to pay when goods are delivered?

An agreement that a company will offset a hard-currency sale to a nation by making a hard-currency purchase of an unspecified product from that nation in the future is called a(n) ________.

Types of entry modes available to companies include all of these EXCEPT ________.

Cross licensing occurs when companies employ licensing agreements to swap intangible property with one another.

Which of these is the exchange of goods and services directly for other goods and services without the use of money?

A contractual entry mode in which one company supplies another with intangible property and other assistance over an extended period is called ________.

Export/import financing in which the importer's bank issues a document stating the bank will pay the exporter when the exporter fulfills the terms of the document is called ________.

The choice of entry mode depends on many factors, including ________.

A confirmed letter of credit is guaranteed by both the exporter's bank in the country of export and the importer's bank in the country of import.

Switch trading is the export of industrial equipment in return for products produced by that equipment.

________ normally takes the form of a wire transfer of money from the bank account of the importer directly to that of the exporter prior to shipment of merchandise.

________ occurs when companies employ licensing agreements to swap intangible property with one another.