International Business Final
6. Home Depot made a greenfield investment when it entered the Mexican market by purchasing Home Mart, a domestic store chain.
false
Copyright Licensing
A copyright gives the owner the exclusive right to reproduce art, music, literature, software, and other such works, as well as prepare derivative works, distribute copies, or perform or display the work publicly. The term of protection varies by country, but the creator's life plus 50 years is typical. Many countries offer little or no copyright protection. Thus, it is wise to investigate local copyright laws before publishing a work abroad
International collaborative venture
A cross-border business alliance in which partnering firms pool their resources and share costs and risks of a venture
Joint venture (JV
A form of collaboration between two or more firms to create a jointly-owned enterprise.
Global Market Segment
A group of customers that share common characteristics across many national markets. Firms target these buyers with relatively uniform marketing programs, regarding product, pricing, communications, and distribution Such segments often follow global media, embrace new fashions or trends, and have much disposable income.
Licensing
A licensing agreement specifies the nature of the relationship between the licensor (owner of intellectual property) and the licensee (the user). In a typical deal, the licensee pays the licensor a fixed amount upfront and an ongoing royalty (usually 2-5%) on gross sales generated from using the licensed asset. The fixed amount covers the licensor's initial costs of transferring the licensed asset to the licensee, including training, engineering, or adaptation. Certain types of licensable assets, such as copyrights and trademarks, have much lower transfer costs.
Typical Types of Intellectual Property
A patent provides the right to prevent others from using an invention for a fixed period. It is granted to anyone who invents a new process, product, or useful improvement. A trademark is a distinctive design or symbol that identifies a product or service. E.g., Nike's swoosh symbol. A copyright protects original works of authorship. Typically covers works of music, art, literature, movies, or software.
Global marketing strategy
A plan of action for foreign markets that guides the firm in deciding: - how to position itself and its offerings, - which customer segments to target, and - the degree to which it should standardize or adapt its marketing program elements.
Global Branding
A strong global brand enhances: efficiency and effectiveness of marketing programs; facilitates the ability to charge premium prices; increases the firm's leverage with resellers; stimulates brand loyalty; and inspires trust and confidence in the product
17. Which of the following is the best example of a situation in which a firm is compensating an employee with base remuneration?
A) An American engineer working in Japan receives a salary comparable to that of engineers working in the U.S.
11. ________ refers to the confusion and anxiety experienced by a person who lives in a foreign culture for an extended period.
A) Culture shock
19. ________ refers to a marketing strategy in which the firm develops both the product and its marketing to evoke a distinct impression in the customer's mind, emphasizing differences from competitors' offerings.
A) Positioning
22.Which of the following most likely supports Cold-Aire implementing a regional strategy of refrigerator standardization?
A) Refrigerator sizes within Latin America tend to be similar.
13. Feldman Insurance wants to enter the Brazilian market but is concerned about hostile government regulations in Brazil. Which of the following would most likely help Feldman overcome this problem?
A) forming a joint venture with a local firm
16. Which of the following occurs when products are imported into a country legally but outside the normal channels of distribution authorized by the manufacturer?
A) gray market
9. Which of the following is characteristic of master franchise arrangements?
A) subfranchises to other independent businesses and thus assumes the role of the local franchisor
12. Why is management of international human resources more difficult than directing human resources at the domestic level?
A) the challenge of adjusting for political, cultural, legal, and economic differences between countries
Standardization and Adaptation: A Balancing Act
Adaptation is costly, often requiring major changes to the marketing mix, especially when many national markets are involved. Thus, managers usually err on the side of standardization, that is, they adapt marketing elements only when necessary. Some firms pursue a regional strategy, in which marketing elements are formulated across a geographic region. Dell balances standardization and adaptation - the basic machines are identical worldwide, while the keyboards and software are adapted to suit local conditions
Tradeoffs between Standardization and Adaptation
Adaptation: local in muiltidomestic industries national preferences laws and regulations living standards and economic conditions national infrastructure Advantages: Meet needs of customers more precisely unique appeal comply with government regulations achieve a greater success in combating customer resistance
Standardization and Adaptation
Adaptation: Modifying elements of the marketing program to accommodate specific customer requirements in individual foreign markets. E.g., Industries in automaking, publishing, and furniture. Standardization: Efforts to make marketing program elements uniform, so as to target entire regions of countries, or even the global marketplace, with a similar product or service. However, targeting the same product everywhere is not usually feasible. Management tries to strike some ideal balance between adaptation and standardization.
Leading Destinations for FDI
Advanced economies in Europe (especially Britain), Japan, and North America, are popular FDI destinations, mainly as attractive markets. In recent years, emerging markets and developing economies have gained appeal as FDI destinations.
Advantages and Disadvantages of Franchising
Advantages for franchiser: Low investment; Can internationalize quickly to many markets; Low effort, once established; and Can leverage franchisees' local knowledge. Disadvantages for franchiser: Maintaining control over franchisees may be difficult; Franchiser has limited control over its assets abroad; and Risks creating a future competitor.
Main Advantages and Disadvantages of Licensing
Advantages for licensor Low investment Low involvement Low effort, once established Low-cost initial entry strategy Disadvantages for licensor Performance depends on the foreign licensee Licensor has limited control over its asset(s) abroad Runs the risk of creating a future competitor
Strategies to Cope with Gray Markets
Aggressively cut prices in countries and regions targeted by gray market brokers. Hinder the flow of products into markets where gray market brokers procure the product. Design products with exclusive features that strongly appeal to customers. Publicize the limitations of gray market channels.
Expatriate
An employee who goes to work abroad for an extended period, typically from two to five years long. Expatriate assignment failure: The premature return of an expatriate, due to an inability to perform well abroad. Costly to the firm and to expatriates themselves.
Countertrade
An international business transaction in which all or partial payments are made in kind rather than cash. Similar to barter. Used when conventional means of payment are difficult, costly, or nonexistent. Accounts for between 10% and 1/3 of all world trade. Common in large-scale government procurement. Risky. May involve inferior or hard-to-price goods; may lead to price padding; Can be complex, cumbersome, and time-consuming.
23. Which of the following best supports Cold-Aire making fewer refrigerator adaptations?
B) Standardization reduces manufacturing expenses.
18. Mona, a native of India, is employed by IBM in the firm's facility in New Delhi. Mona is best described as a(n) ________.
B) local
10. What is the gray market?
B) selling goods through unofficial distributors
8. All of the following are true of global new-product planning teams EXCEPT ________.
B) they are responsible for global promotion of products and services
Examples of Countertrade
Boeing traded aircraft for oil, in Saudi Arabia. Caterpillar received wine in Algeria, in exchange for earthmoving equipment. Goodyear traded tires for minerals, textiles, and agricultural products. Coca-Cola received tomato paste from Turkey, oranges from Egypt, and beer from Poland, in exchange for Coke.
21.Which of the following questions would be the most important for Cold-Aire managers to evaluate when determining how the firm could reduce production costs in a single market?
C) Can Cold-Aire standardize its refrigerators?
24. Which of the following would most likely be a result of increased standardization of Cold-Aire refrigerators?
C) Cold-Aire would implement a uniform international marketing campaign.
15. ________ is an arrangement in which the focal firm or a consortium of firms plans, finances, organizes, manages, and implements all phases of a project abroad and then hands it over to a foreign customer after training local workers.
C) Turnkey contracting
An example of a third-country national is a
Canadian citizen working for a U.S. company in Mexico
Methods of Payment
Cash in Advance Best for the seller. Risky from the buyer's standpoint, and thus unpopular; tends to discourage sales. Open Account Easy for the exporter, who simply bills the buyer, who is expected to pay at some future time as agreed. Risky unless there is strong established relationship between exporter and buyer Letter of Credit A contract between the banks of the buyer and the seller. Largely risk-free, it helps establish instant trust. Requires following a strict protocol, specified in the contract. Can involve much paperwork.
Disadvantages of Exporting
Compared to FDI, exporting offers fewer opportunities to learn about customers, competitors, and other aspects of foreign markets. Firm must acquire and dedicate new capabilities in international sales contracts and transactions, international financing methods, and logistics and documentation, all of which can strain organizational resources. Exposes the firm to tariffs and other trade barriers as well as fluctuating exchange rates.
4. Compensation of Personnel
Compensation varies internationally due to differences in legally mandated benefits, tax laws, cost of living, local tradition, and culture. Employees posted abroad expect to be compensated at a level that allows them to maintain their usual standard of living, which can make compensating expatriates very costly. Includes base remuneration, benefits (e.g., health care plans), allowance (e.g., for housing, children's education, travel), incentives
Indirect exporting
Contracting with an intermediary in the firm's home country to perform all export functions, often an Export Management Company or a Trading Company. Common among firms new to exporting.
Direct exporting
Contracting with intermediaries in the foreign market to perform export functions, such as distributors or agents. They perform downstream value-chain activities in the target market.
Advantages of Standardized Marketing
Cost reduction. Standardization reduces costs through economies of scale in design, sourcing, manufacturing, and marketing. Offering a similar marketing program globally is more efficient than adapting products and marketing for each of the numerous individual markets. Improved planning and control. Fewer offerings simplify quality control and reduce the number of replacement parts. Global marketing is easier to manage than having to develop numerous campaigns. Ability to portray a consistent image and build global brands. Standardized marketing increases customer interest and reduces the customer confusion.
7. Which of the following is a disadvantage of licensing for technological firms?
D) It increases the risk of creating a future competitor.
20. Locating manufacturing in countries with low-cost labor enables a firm to ________.
D) charge lower prices
14. In which of the following industries is standardization more likely to be pursued?
D) credit cards
Adaption is needed due to:
Differences in national preferences. Companies adapt their products to suit the specific, unique wants and needs of customers in individual markets. Differences in living standards and economic conditions. Firms adjust the pricing and complexity of their products to accommodate differing income levels worldwide. Differences in laws and regulations. E.g., Germany and Norway restrict advertising directed at children. Packaged foods in Europe are often labeled in several languages, including English, French, and Spanish. Differences in national infrastructure. The quality and reach of transportation and communications systems, and of general infrastructure differ worldwide
International Distribution
Distribution is the most inflexible of the marketing program elements - once established, it may be difficult to change. The most common international distribution approaches are via independent intermediaries (for exporters) and establishing a subsidiary directly in the market (FDI). Both types of channels must perform a range of downstream marketing activities. The firm should seek to minimize channel length, to minimize final prices and decrease complexity
9. A know-how agreement grants a firm permission to use another firm's proprietary names, characters, or logos for a specified period of time in exchange for a royalty.
false
1.Indirect exporting is exporting that is accomplished by contracting with intermediaries located in the foreign market.
False
International Advertising
Firms conduct advertising via media, which includes direct mail, radio, television, cinema, billboards, transit, print media, and the Internet. Advertising spending on major media amounts to more than $100 billion in each of Asia-Pacific and Western Europe. In the United States, advertising expenditures total nearly $200 billion. Advertising is influenced by local factors, such as availability of media, literacy, regulations, culture, and local customs, as well as the goals of the firm
Gray Marketing
Legal importation of genuine products into a country by other than authorized intermediaries. Gray marketers buy the product at a low price in one country, import it into another country, and sell it there at a higher price. Causes: - Large difference in pricing of same product between two countries, often the result of company strategy. - Exchange rate differences of products priced in two different currencies.
Unique Aspects of Contractual Relationships
Governed by a contract that provides the focal firm a moderate level of control over the foreign partner. Control reflects the ability of the firm to influence the decisions, operations, and strategic resources of a foreign venture. Typically involve exchange of intangibles (intellectual property) and services. Examples include technical assistance, know-how, and trademarks. Can be pursued independently or with other foreign market entry strategies, such as FDI and exporting
Greenfield Investment vs. M&As
Greenfield investment: The firm invests to build a new manufacturing, marketing or administrative facility, as opposed to acquiring existing facilities. Acquisition: Direct investment or purchase an existing company or facility. Merger: Special type of acquisition in which two firms join to form a new, larger company
Three Employee Categories in the MNE
Host-country nationals (HCNs): Citizens of the country where the subsidiary or affiliate is located. HCNs make up largest proportion of employees that the firm hires abroad. Examples: the labor force in manufacturing, assembly, basic service activities, clerical work, and other non-managerial functions. Parent-country nationals (PCNs): Also known as home-country nationals, PCNs are citizens of the country where the MNE is headquartered. Third-country nationals (TCNs): Employees who are citizens of countries other than the home or host country. Most work in management; have unique skills
International Human Resource Management
How a firm recruits, trains, and places skilled personnel in its worldwide value chains sets it apart from competition. The combined knowledge, skills, and experiences of employees are distinctive and provide myriad advantages to the firm's operations worldwide
Global Product Development
In developing international products, managers emphasize their commonalities across countries rather than the differences between them. A basic product incorporates only core features that are then varied at the margins for individual markets. A global new-product planning team is a group within a firm that determines which product elements will be standardized and which will be adapted locally, and how products will be launched
Success Strategies for Women in IB
In many countries, being a foreign woman can be an advantage. Women stand out more, and competent women earn respect. Smart women leverage their gender to their advantage. Women overcome biases abroad by acquiring managerial, language, and international skills. Over time, managerial competence wins out over bias. Gaining substantial experience as a domestic manager or in short international assignments can greatly improve prospects for working abroad. Once abroad, women report the reaction of surprise is often replaced by professionalism and respect
Training
In order of increasing rigor, training methods include: videos, lectures, assigned readings, case studies, books, web-based instruction, critical incident analyses, simulations, role-playing, language training, field experience, and long-term immersion. Role-playing and simulations involve the employee acting out typical encounters with foreigners. Long-term immersion places the employee in the country for several months or more, often for language and cultural training.
Types of importers
Input optimizers: uses foreign sourcing to optimize Opportunistic: look for products around the world that they can import and sell to local citizens Arbitrageurs: look to foreign sourcing to get the highest quality at the lowest price
International Human Resource Management Continued
International human resource management (IHRM) refers to planning, selection, training, and evaluation of employees for international operations. For example, Siemens has more than 350,000 employees in 200 countries: 200,000 throughout Europe, 80,000 in the Americas, 60,000 in the Asia-Pacific region, and 10,000 in Africa, the Middle East, and Russia. Each of Volkswagen, Nestle, IBM, Unilever, Walmart, and McDonald's has more than 150,000 employees outside the firm's home country.
Key Tasks of IHRM
International staffing policy - activities directed at recruiting, selecting, and placing employees. Preparation, training of international employees. International performance appraisal - providing feedback for employees' professional development. Compensation of employees - including formulation of benefit packages that vary from country to country. International labor relations - managing relationships unions; collective bargaining processes, known as industrial relations. Diversity in the international workforce
Characteristics That Facilitate International Effectiveness (cont'd)
Interpersonal Skills. Ability to build relationships is key. Leadership Ability. Must view change positively, and proactively manage threats and opportunities. Physical and Emotional Health. Life abroad is stressful. Spouse / Dependents Prepared for Living Abroad.
Know-How Licensing
Involves a contract in which the focal firm provides technological or management knowledge about how to design, manufacture, or deliver a product or a service. The licensor makes its patents, trade secrets, or other know-how available to a licensee in exchange for a royalty. The royalty may be a lump sum, a "running royalty" based on the volume of products produced from the know-how, or a combination of both
Trademark Licensing
Involves a firm granting another firm permission to use its proprietary names, characters, or logos for a specified period of time in exchange for a royalty. Trademarks appear on clothing, food, toys, home furnishings, and numerous other goods and services. E.g., Coca Cola, Harley-Davidson, Laura Ashley, Disney, Michael Jordan, and your university! UNCW A trademark like Harry Potter generates millions for the owner, with little effort. U.S. firms derive trademark-licensing revenues exceeding $100 billion annually.
advantage of exporting
It increases overall sales volume, improves market share, and reduces per-unit costs of manufacturing
Employee Characteristics That Facilitate International Effectiveness
Job knowledge. Must have adequate managerial and technical capabilities. Self-Reliance. Entrepreneurial, proactive mindset; expatriate managers function with considerable independence, and limited support from headquarters. Adaptability. Ability to adjust to foreign cultures, cultural empathy, flexibility, diplomacy, and a positive attitude.
Preparing Employees for Repatriation
Repatriation: Return of the expatriate to the home country. Requires advance preparation. Unless managed well, returning expatriate may encounter problems, such as career disruptions and "reverse culture shock"
Two Types of Contractual Relationships
Licensing: An arrangement in which the owner of intellectual property grants another firm the right to use that property for a specified period of time in exchange for royalties or other compensation. Franchising: Arrangement in which the firm allows another the right to use an entire business system in exchange for fees, royalties or other compensation. Royalty: A fee paid periodically to compensate a licensor for the temporary use of its intellectual property, often based on a percentage of gross sales generated from the use of the licensed asset
5. Labor Unions and Collective Bargaining
Management and workers determine the job relationships that will be in effect at the workplace. Collective bargaining involves negotiations between management and workers regarding wages and working conditions. Labor regulations vary substantially, with minimum regulations in Africa and India to very detailed regulations in Northern Europe. Union membership has declined in most countries, but remains high in several European countries. Strikes can disrupt international operations
Differences between Domestic and International HRM (cont'd)
Managing the mix of expatriates versus locals. Each location may be staffed with a mix of HCNs, PCNs, and TCNs, depending on firm's international experience, cost-of-living abroad, local laws, and availability of qualified local staff. Greater risk exposure. Exposure to political risk and terrorism may require increased compensation and security arrangements. External influences of government and culture, such as regarding taxes, local work regulations, traditional work practices, and cultural conditions.
Recent Positive Trends
Many more women are obtaining university degrees in business. Female graduates account for some 50% of recruits joining European firms. Businesswomen increasingly form their own networks, such as Women Directors on Boards in Britain, and The Alliance of Business Women International in the United States (www.abwi.org). Overall trend is positive (except in strongly Islamic countries).
6. Trends in International Labor
Mobility of labor across national borders has increased substantially. Reasons: Growing interconnectedness of national economies; Rapid expansion of multinational firms; Rise of international collaborative ventures; and Greater emphasis on global teams. Many countries are coping with an influx of immigrants, both legal and illegal, who compete with established workers by providing low-cost labor. Trend is significant in Europe, Persian Gulf countries, and the United States (but not in Japan).
Franchising
Most typical arrangement is business format franchising, in which franchisor transfers to the franchisee a total business method - including production and marketing methods, sales systems, procedures, training, and the use of its name. More comprehensive and longer-term than licensing. The franschisor prescribes virtually all of the business acitivities of the franchisee. Controls the business system to ensure consistent standards
Factors that Affect International Pricing
Nature of the market. Local purchasing power and distribution infrastructure are big factors. Nature of the product or industry. A specialized or highly advanced product, or an industry with few competitors, may necessitate charging a higher price. Type of distribution system. Channels are complex in some countries, which pushes prices up. Location of the production facility. Locating manufacturing near customers or in countries with low-cost labor facilitates lower prices
Differences between Domestic and International HRM
New HR responsibilities, such as international taxation, international relocation and orientation, services for expatriates, host government relations, language translation services. Need for a broader perspective, such as establishing fair, comparable compensation when there is a mix of PCNs, HCNs, and TCNs. Greater involvement in employees' personal lives, such as regarding housing arrangements, health care, children's education, safety, security, appropriate compensation, and higher living costs
FDI
Overall, most services are provided to foreign customers via entry strategies other than exporting, especially FDI. Retailers offer their services by establishing retail stores abroad, via FDI. Retailing requires direct contact with customers. Foreign direct investment (FDI): Strategy in which the firm establishes a physical presence abroad by acquiring productive assets such as capital, technology, labor, land, plant, and equipment.
3. Performance Appraisal
Performance appraisal: Formal process of assessing how effectively employees perform their jobs. Helps identify problem areas where an employee needs to improve and additional training is warranted. Determines compensation and firm performance. MNEs devise procedures to assess the performance of individual employees; ascertain if any problems are attributable to inadequate skill levels; provide additional training and resources; and terminate employees who consistently fail to achieve goals.
Exporting
Popular with SMEs. Increase sales volume; improve market share. Generate better profit margins. Increase economies of scale. Diversify customer base. Stabilize sales fluctuations. Minimize the cost of foreign market entry. Minimize risk
International Pricing
Pricing is complex in international business, due to multiple currencies, trade barriers, added costs, and typically longer distribution channels. Prices affect sales and profits. An inverse relationship often exists between profits and market share. Firms face pressure to lower prices abroad, mainly due to lower income levels. Conversely, prices can escalate due to tariffs, taxes transportation, intermediary markups, and |after-sales service.
Which of the following refers to an advantage for firms that adapt a unique marketing program for an individual market?
Products are tailored to specifically meet the exclusive needs of customers in that market
Contractual Relationships (cont'd)
Provide dynamic, flexible choice, where firms may use contractual agreements to make their initial entry in foreign markets. Then, as conditions evolve, they switch to another entry strategy, such as FDI. Can reduce perceptions of the firm as a foreign enterprise. A contractual relationship with a local firm facilitates blending into the local market. Generate a consistent earnings from foreign operations, compared with FDI, as contractual arrangements are less susceptible to volatility and risk.
1. Staffing: Searching for Talent
Recruitment: Searching for and locating potential job candidates to fill the firm's needs. Selection: Gathering information to evaluate and decide who to employ in particular jobs. Managers must proactively identify potential candidates and groom them to become corporate leaders, train personnel to meet evolving business needs, and ensure the talent supply keeps pace with the growth of the firm.
Key Features of Foreign Direct Investment
Represents substantial resource commitment. Implies local presence and operations. Firms invest in countries that provide specific comparative advantages. Substantial risk and uncertainty. Direct investors deal more intensively with specific social and cultural variables in the host market
Three Pricing Strategies
Rigid cost-plus pricing. Set a fixed price for all export markets, by adding a flat percentage to the domestic price to compensate for the added costs of doing business abroad. Flexible cost-plus pricing. Set price to accommodate local market conditions, such as customer purchasing power, demand, and competitor prices. Incremental pricing. Set price to cover only variable costs, not fixed costs. This assumes that fixed costs are already paid from sales in the home or other countries.
Gray Market Activity Harms the Firm
Risk of tarnished image when customers realize the product is available at a lower price through alternative channels. Strained relations with distributors, as the latter lose sales. Disrupted company activities, including: Sales forecasting, Pricing strategies, Merchandising, and Marketing.
Standardized Marketing is Appropriate When:
Similar market segments exist across countries. Customers seek similar features in the product or service. Products have universal specifications. Business customers have converging expectations or needs regarding specifications, quality, performance, and other product attributes
Tradeoffs between Standardization and Adaptation
Standardization: global industries similar marget segments across countries customers seek similar features products have universal specifications business customers have converging expectations Advantages: cost reduction imporved planning and control build global brands
Cultural Intelligence
Strategy describes how an employee makes sense of cross-cultural experiences through her or his judgments. Knowledge is the employee's understanding of cultural dimensions such as values, social norms, religious beliefs, and language. Motivation measures the employee's interest in interacting with people from different cultures and confidence in doing so effectively. Behavioral flexibility is the employee's ability to adopt verbal and nonverbal behaviors appropriate in different cultures.
When a firm allows others to use an entire business system in exchange for compensation, the arrangement is known as
franchising
Culture Shock
The confusion and anxiety, often akin to mental depression, that can result from living in a foreign culture for an extended period. Often affects family members most. A leading cause of expatriate failure. Especially a factor for those assigned to culturally dissimilar countries, such as China, Yemen. Can be reduced via advance preparation, training, language skills, deep interest in the new country. Regular exercise, relaxation techniques, or keeping a detailed journal of experiences are helpful
Market Segmentation
The process of dividing the firm's total customer base into homogeneous clusters that allows management to formulate unique marketing strategies for each group. Within each market segment, customers exhibit similar characteristics regarding income level, lifestyle, demographic profile, or desired product benefits. Internationally, common market segment variables include income level, culture, legal system, etc
2. Training
Three Components of Training Personnel for International Assignments; Area studies: factual knowledge of the historical, political and economic environment of the host country. Practical information: knowledge and skills necessary to function effectively in a country, including housing, health care, education, and daily living. Cross-cultural awareness: ability to interact effectively and appropriately with people from different language and cultural backgrounds.
Other Contractual Arrangements
Turnkey contracting: Arrangement where a firm plans, finances, organizes, manages, and implements all phases of a project abroad, and hands it over to a foreign country after training local personnel. Typical in the construction and engineering services industries. Under a management contract, a contractor supplies managerial know-how to operate a hotel, resort, airport, hospital, or other facility, in exchange for compensation. With international leasing, the lesser rents out machinery or equipment to clients abroad, often for several years at a time. E.g., Airlines lease aircraft
women in international business
Women occupy relatively few top management positions Reasons for scarcity of women in international jobs: -- Senior managers assume women are not suitable leaders abroad (e.g., due to cultural challenges) -- Some female managers remain in the home country, to fulfill family obligations or avoid disrupting their partner's career. -- Most companies do not accommodate child-rearing or other family responsibilities. -- There are fewer women with sufficient experience to be sent abroad for senior jobs. Queen bee syndrome Glass ceiling Glass cliff
13. One of the advantages for the franchisor is that is it easier to maintain control over the franchisee.
false
14. In what is known as direct exporting, the exporter sells goods directly to or through an independent domestic intermediary in the exporter's home country that then exports the products to foreign markets.
false
Adaptation is often necessitated due to
differences across countries in language, culture, economic conditions, and other factors
Which of the following is characteristic of a know-how agreement?
exchanging technological or management information for royalties
11. One of the disadvantages of licensing is that it requires the licensor to make a high capital investment in the foreign market.
false
10. Varying income levels among nations usually necessitate that firms make price adjustments and product modifications for individual markets.
true
12. Franchising is an advanced form of licensing in which the franchisor allows the franchisee the right to use an entire business system in exchange for compensation.
true
2. Compared to other entry strategies, exporting minimizes risk and maximizes flexibility.
true
3. An example of an expatriate would be a Canadian manager working for a Canadian firm in China.
true
4. FDI is the most advanced and complex foreign market entry strategy.
true
5. Incremental pricing refers to setting prices to cover only the firm's variable costs, but not its fixed costs.
true
7. A reputed American automaker competes in the premium car market segment. It targets affluent buyers with refined tastes who would not mind paying several thousand dollars for a premium car. This is an example of positioning.
true
8. Contractual entry strategies in international business are cross-border exchanges in which the relationship between the focal firm and its foreign partner is governed by an explicit contract.
true