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PowerPoint Presentations for Small Business Management: Launching and Growing New Ventures, Fifth Canadian Edition
Adapted by Cheryl DowellAlgonquin College
Slide2CHAPTER 8
Global Marketing
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Slide3LOOKING AHEAD
After studying this chapter, you should be able to:Discuss global marketing and the potential of small firms as global enterprises.Explain the challenges that global enterprises face.Describe the initial steps of a global marketing effort.Identify sources of trade and financing assistance.
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Slide4GLOBAL BUSINESS
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Innovation is essential to competitivenessExpanding markets are one of the forces behind global expansionCompanies are looking to emerging markets where income and buying power are growing rapidly (see Exhibit 8-1)China and India have attracted attention from international firms because of their large populations and potential market demand
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Slide5GLOBAL BUSINESS
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Slide6GLOBAL CHALLENGES
TRADE AGREEMENTSFree Trade Agreement(FTA)accord that eases trade restrictions between Canada and the United StatesNorth American Free Trade Agreement (NAFTA)eases trade restrictions among Canada, theUnited States, and MexicoGeneral Agreement on Tariffs and Trade (GATT)international agreement that aims to reduce tariffs and other trade barriers among countriesWorld Trade Organization (WTO)international organization that administers GATT and works to lower tariffs and trade barriers worldwide
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Slide7INITIAL PREPARATIONS FOR GLOBAL MARKETING
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Research the foreign market and settingSet up a sales and distribution plan
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Slide8RESEARCHING A FOREIGN MARKET
DFAIT (Department Of Foreign Affairs And International Trade)primary Canadian government agency responsible for assisting exportersServices offered:Export Information KitExport CounsellingWorld Information Network for Exporters (WINS)International Trade Data BankOverseas Trade FairsTrade Leads and Trade MissionsInternet Resources www.international.gc.ca
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Slide9OTHER FEDERAL GOVERNMENT DEPARTMENTS AND PROGRAMS
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Canadian Commercial Corporation (CCC) http:// www.ccc.ca Export Development Canada http:// www.edc.ca Canadian International Development Agency (CIDA) http:// www.acdi-cida.gc.ca Canada Revenue Agencyhttp:// www.cra-arc.gc.ca/menu-e.html BDChttp://www.bdc.ca/Pages/SplashPage.aspxStatistics Canadawww.statcan.gc.ca Forum for International Trade Training (FITT)http:// www.fitt.ca
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Slide10QUESTIONS TO ASSIST WITH GLOBAL EXPANSION
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Slide11SALES AND DISTRIBUTION CHANNELS
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Licensinglegal arrangement allowing another manufacturer to use the property of the licenser in return for royalties
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Slide12SALES AND DISTRIBUTIONRISK LEVELS
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Slide13FOREIGN MARKET CHANNELS OF DISTRIBUTION
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Slide14SOURCES OF TRADE ANDFINANCING ASSISTANCE
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Getting trade information and arranging financing is often the biggest barrier to small business exportingDirect and indirect sources of trade and financing information:Private banksletters of creditFactoring housesThe Export Development Corporation (EDC)
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Slide15LETTER OF CREDIT
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Buyer arranges for its bank to open a letter of creditBuyer’s bank prepares an irrevocable letter of creditBuyer’s bank sends the irrevocable letter of credit to a Canadian bank, requesting confirmation. The Canadian bank prepares a letter of confirmation to forward to the exporter. Exporter reviews all conditions in the letter of credit. Exporter arranges with the freight forwarder to deliver the goods to the appropriate port or airport.Continued…
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Slide16LETTER OF CREDIT
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Freight forwarder completes the necessary documents.Exporter (or the freight forwarder) presents to the Canadian bank documents indicating full compliance.Bank reviews the documents. Documents are forwarded to the buyer’s bank for review and transmitted to the buyer.Buyer (or agent) gets the documents that may be needed to claim the goods.A draft, which may accompany the letter of credit, is paid by the exporter’s bank
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