How To Succeed In International Business

Author	John Michael Pierobon
E-mail:	pierobon@pierobon.org
Web site:	http://www.pierobon.org/

Go to the outline of:
Chapter 0	Chapter 1	Chapter 2	Chapter 3	Chapter 4	Chapter 5	Chapter 6
Chapter 7	Chapter 8	Chapter 9	Chapter 10	Chapter 11	Chapter 12	Chapter 13

Course Introduction

Course Objectives
Intended Audience
Course Structure

Bookmarks of all the external links that appear in the course.
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Course Content

Developing An Export Plan

Strategy comes from the Greek

Why Have An Export Plan
Evaluating The Export Potential Of Your Products

How successful are your products domestically?
What are the unique features of your products?
Are you losing market share to more technically advanced products?

Is Your Company Ready To Export?

Developing A Marketing Plan

The Importance of Market Research
What Is Market Research

Primary Market Research
More on Primary Market Research

Advantages
Disdvantages

Secondary Market Research
More on Secondary Market Research

Advantages
Disdvantages

Using Primary and Secondary Market Research
Decision Making Ingredients
Classification Systems
Why Classify Your Products

Getting Started With Your Market Research
Factors To Consider

Market Size

Population
Total GNP
Per capita GNP
Rate of investment
Local production of your product

Market Growth

Import history
Trends and forecasts
Change in per capita income
Industrial development stage of the market

Market Accessibility

Import duties and tariffs
Product standards
Local suppliers
Foreign suppliers
How distribution channels work
How to obtain import permits
Pricing methods
Advertising and promotional practices
Credit terms

Economic Stability

Exchange rate performance
If currency controls exist
The balance of payments
Foreign currency reserves
Goverment debt and budget
Rate of inflation
Rate of unemployment

Political Climate

Ability to import into the market
Attitude towards your country
Political stability

Cultural Climate

Religion
Symbols
Numbers
Colors

Education
Language
Environmental Factors

Temperature
Humidity
Altitude
Sand

Geographical Factors

Travel time
Travel costs
Delivery time
Shipping costs

Legal System

Independent judiciary
Copyright protection
Trademark protection
Right to sue
Right to own property
Right to travel

Analyze The Information Collected
Making A Decision

Choose the path of least resistance
Choose markets that fit your resources
Choose markets for the long term
Avoid paralysis by analysis
Use common sense

Chapter 2 Review Questions
Chapter 2 Review

Exploring Exporting Options

Indirect Exporting

Direct Exporting

Sales Representatives

When to Use Sales Representatives

Distributors

Other Methods of Exporting

Finding Trade Contacts

Where To Look

How Your Government Can Help You

Foreign Governments
Commercial Attaché

Local trade and tariff laws
Government procurement procedures
Local business practices
Identify potential importers, agents, distributors, and joint venture partners
Provide information on local government tenders
Assist with trade and investment disputes

Exhibiting At Trade Shows

More On International Trade Consultants

What To Look For

Chapter 4 Review Questions
Chapter 4 Review

The Voyage

Why You Should Visit Your Target Market

Evaluate potential partners.
Partners evaluate you.
Size up the competition.
Conduct primary market research.

If You Cannot Visit Your Target Market
Is All This Planning Necessary?

Planning The Trip

Duration

Travel Time

Traveling between countries takes time.
Today in America is tomorrow in Asia.

Travel Time Exercise
Jet Lag

Coach or Business Class
Is the cost difference worth it?
Can you sleep on an airplane?

High Altitude

La Paz 3650 meters
Quito 2800 meters
Bogotá 2600 meters
Mexico City 2240 meters
Johannesburg 1750 meters
Nairobi 1660 meters
Denver 1610 meters
Guatemala City 1530 meters

Flexibility
Time to Explore

It may be the only time you visit this place

When To Go

Holidays

In Your Country
In Their Country

Working Days

Israel
Moslem Countries

Know Where You Are Going

Things you should know about the country you are going to

What language do they speak?
What are appropriate/inappropriate gestures?
What is the exchange rate?
What is the electrical current?
On what side of the road do they drive on?
What are the units of measure?

Miles versus kilometers
Feet versus meters
Gallons versus liters
Pounds versus kilograms
Letter versus A4 paper

Know Where You Are Going Exercise
Study The Map

Get detailed directions

Understand the distances

In Time
In Space

Do Not Trust Your Travel Agent

Have they been to where you are going?
Have they flown internationally?
What incentive do they have in saving you money?

They get paid on commission

No longer true for airfare
Still true for car rental
Still true for hotel

Use the World Wide Web

Booking The Trip

Airfare

Costs more on weekends
High season or low season
Flexibility

Advance purchase
Change penalties
Last Flight Out

Frequent Flyer Programs
Around the world ticket
Tourist Class Or Business Class

Is the cost difference worth it?

Bigger seat
Access to airport lounge
Better meal
Usually a better seatmate
Off the airplane quicker

Seat Preference

Emergency exit row
Bulkhead

You can put your feet up
You cannot put things under the seat in front of you

Hotel

Where To Stay

Image
Proximity
Recommendations

Type Of Room

Smoking
Non-smoking
High floor
Low floor
King size bed
Two double beds
Suite
Adjoining rooms
Concierge level

Room Rate

Corporate rate
Costs less on weekends
High season or low season
Does the rate include breakfast

Cancellation Policy
Hotel Guest Loyalty Programs

Ground Transportation

Car Rental

Class Of Vehicle

Taxi
Bus
Subway
Train
A combination of the above

Travel Documents

Passport

When does your passport expire?
Photographs
Forms
Other requirements

Obtaining A Visa

Type Of Visa

Immunizations

Before You Go

Learn The Language

Learn some key phrases
Listen to audio tapes in your car

Suitcase

Hard plastic
Easy to lock
Easy to identify
Wheels

What To Pack

Weather
Know The Weather Exercise
Clothes

Shoes
Socks
Underwear
Suits
Shirts/Blouses
Belts
Ties
Sleepware
Travel Clothes
Casual Clothes
Exercise Clothes

Toiletries

Shampoo
Hair dryer
Electric items

110v versus 220v

Money

Cash
Traveler's Cheques
Credit cards
Know the exchange rate

Work Materials

Cellular Telephone
Laptop Computer
Business Cards

Product Samples
Gifts

Do not wrap gifts until you arrive

Disposable Camera

Inexpensive
Make friends
Create memories

Medicine

Aspirin
Prescription drugs

Other Important Items

Dictionary
Maps
Documents

Photocopies
Itineraries

Travel Day

What to Wear

Comfortable clothes
Walking shoes
How airlines will treat you

Getting To The Airport

International Flights
Domestic Flights

Checking In

Verify that your seat preference has been honored.
Check to be sure your bags are taged to the correct destination.
Ask for customs and immigration forms.

Leaving The Country

Passport
Boarding Pass
Airport Tax Receipt

Security

No jokes
How to walk though
Be careful with your belongings

Duty Free
Boarding

Board the aircraft as soon as you can

While In Flight

Things you can do during the flight that can save time upon arrival
Healthy things to do in flight

Walk around
Drink liquids
Sleep

Get Off The Aircraft First

Catching the bus or tram
Waiting in line

Average wait time 35 minutes in the United States

Immigration

Read the signs; get in the right line.
Have your forms filled out before you get in line.
Be patient and polite.

Customs
Getting Around The Airport
Transportation

Will someone be there at the airport to greet you?
Which mode of transportation should I use?
Rent A Car

Age
Credit card

Some places do not accept debit cards

Driver's License

Photocopy is not acceptable

Frequent Flyer Number
Insurance
Return empty or return full
Taxes

Rental Car Safety

Air Conditioning
Ask for a map
Wear your seat belt
Inspect the automobile

License plate and expiration
Hubcaps
Dents and scratches
Gas gauge

Hotel Check In

Requires a credit card

Even if it is direct bill

Always check that your reservation specifications are correct
Hotel key
Which floor am I on?

Your Hotel Room
Hotel Room Amenities

Telephone

Toll free

800
888
877
866

Long Distance

Within the country

Dial 1 in the United States
Dial 0 in most other countries

International Long Distance

Dial 011 in the United States
Dial 00 in most other countries

Hotel Check Out

Hotel bill under the door
VAT refund in Canada

Staying Healthy

Travelers' Diarrhea

The most common illness among executives on the road.

Even those staying at five star hotels get it.

CDC estimates 10,000,000 cases a year.
Developing nations are high risk.

Travelers' Diarrhea Precautions

Boil it
Cook it
Peel it
Forget it

Mosquito Borne Illnesses

Dengue fever
Yellow fever
Malaria
West Nile virus

Altitude Sickness

What you should do

Stay properly hydrated
Take it easy
Sleep when you arrive
Eat a high carbohydrate diet

Potato
Pasta

Things to avoid

Alcohol
Tranquilizers
Sleeping pills

Overcoming Jet Lag
Obtaining Medical Help

Emergency Number

911 in the United States and Canada
999 in the United Kingdom

Chapter 5 Review Questions
Chapter 5 Review

Introductions

Establishing A Positive Presence
Components Of A Proper Introduction

Standing Up
Handshake

Firm
Not too tight
Not like a fish
No fingertip handshake
Shaking Hands In Other Cultures

In the Orient

Bow

In the Middle East

Opposite gender

Eye Contact
Smile
Saying The Name

Forgot A Name

Order Of Introduction

Always look at the most important person and say the most important person's name first.
Introduce the next highest ranking person to the most important person.
Say something brief about the person being introduced.
Introduce the most important person to the other person.
Repeat their names.
Mention something that is of mutual interest to them.

Business Cards
Exchanging Business Cards

Exchanging business cards in the Orient

Names

Use the formal as a sign of respect until told otherwise.

In the Orient last names are used.
In Australia first names are used during first meetings.

Seating

The most important guest should sit at your right.
The next most important guest should sit at your left.

Breaking The Ice

Establish trust

Be sincere
Sound sincere

A number of things you can do to begin a conversation.

Thank them for meeting with you.
Start with a catchy statement.
Refer to something you read in the local newspaper.
Tell a personal story.
Seek a common ground.
Talk about the weather.

Topics To Avoid

Chapter 6 Review Questions
Chapter 6 Review

Managing The Meeting

Why Am I Here?
Clarify The Objectives
Build A Consensus
Why Have A Meeting Agenda
Contents Of A Meeting Agenda

What A Meeting Agenda Should Be

Meeting Minutes Or Action Notes

Action notes are not as formal as meeting minutes

Meeting Minutes
Action Notes
Leadership

Leadership is required to:

Motivate
Inspire
Capture their imaginations
Develop their loyalty
Navigate through change
Sell your product

Successful Meetings

Successful meeting take time to prepare.
- The success of an event depends on the amount of preparation put into it.
- A successful meeting is one that inspires as well as accomplishes.
- Remember to include the bigger picture in every meeting.
- Remind people what they are striving for not just what they are up against.

Prepare
Type Of Meeting

Negotiation
Presentation

Communicating
Ending The Meeting
Follow Up
Meetings To Avoid
Chapter 7 Review Questions
Chapter 7 Review

International Selling

How To Succeed

To succeed in international sales you need to know what you are doing and why.
International sales is more challenging because of:
- Cultural issues
- Language barriers
- Government regulations and tariffs

Basics Of Selling

Sell Yourself
Sell Your Company
Sell Your Product

More On The Basics Of Selling

Establish trust

Fail To Listen
Buying Modes

Complex Sale

Owner Buyer

Releases the money.
Approves the sale.
Has to live with the consequences of the deal.

Financial Buyer

Releases the money.
Fnances the deal.

Technical Screener

Screens out sellers.
Looks at product specifications.

End User

Judges impact your product on the job.
Uses the product.

Advisor

Guides you through the sales process.

What The Owner Buyer Wants

Owner buyers are paid to predict the future.

Owner buyers want knowledge.
Owner buyers want trust.

Owner buyers are generalists.
Owner buyers do not buy products, they buy concepts.

What Is A Concept Sale
Make The Concept Sale First
Results
Identifying The Owner Buyer
More On Identifying The Owner Buyer
Preparing To Meet The Owner Buyer
Cannot Meet The Owner Buyer
Ask The Buyer

Objective questions
Attitudinal questions
Always ask

Comparing Answers
Your Advisor

A good advisor is essential to good strategy.

Can help you find the real buyers.
Identify your areas of strength.
Help you understand the buyer's perception of reality.

Cultural issues.

Can help you understand the results each buyer needs to win.

What Makes A Good Advisor

Your credibility.
Your advisor's credibility.
Your advisor wants you to succeed.

False Advisors

Helpful people.
Your friends.
The government.

Best Advisor

The more advisores you have the better off you are.

Test Your Advisor

Does you advisor trust you?
Has your advisor had any success in this market?
How is your advisor's self interest served by your success?

Asking For Advice
Type Of Customer

Customers are neither good nor bad, but somewhere in the middle.
Identify the customer that matches your strength.
Customer Interests

Long Term
Performance
Price/Performance
Price

Good Customer

Trusts you
Innovative and progressive management
Loyal to vendors selected
Committed to quality
Willing to pay for the added value of your product
Highest business ethics and integrity
Wants a win-win relationship with every sale

Bad Customer

Inflexible on price
Slow in deciding
Not loyal to vendors selected
Only interested in price
Not interested in the product
Authoritarian management system
Wants a lose-win relationship
Secretive
Unwilling to cooperate

Keys To Success
Chapter 8 Review Questions
Chapter 8 Review

Negotiating

What Makes A Good Negotiator
Negotiating Paradigm
Communicating
Body Language, Gestures, And Behaviors

Body language communicates more than words.

Body language shows others how much you like them and how you see yourself.
It is important to recognize the meaning associated with certain behaviors.

These behaviors vary from culture to culture.

The more you understand their culture, the better you will be able to negotiate.

Negotiating From Strength

International Negotiations
Chapter 9 Review Questions
Chapter 9 Review

International Law And Contracts

International Business Transactions

International Trade
Foreign Investments

Export License
Determining Export License Requirements

Classification
Destination
End User
End Use
Conduct

Letter Of Intent
Contracts

Bribery
Evergreen Contract

Rolling Contract

Shipping

Freight Forwarder

Incoterms Groups

Buyer and Seller Obligations

Group E: Departure Term.

EXW - EX WORKS (... named place)

EXW - EX WORKS Responsibilities

Group F: Shipment Terms - Main carriage unpaid.

FCA - FREE CARRIER (... named place)

FCA - FREE CARRIER Responsibilities

FAS - FREE ALONGSIDE SHIP (... named port of shipment)

FAS - FREE ALONGSIDE SHIP Responsibilities

FOB - FREE ON BOARD (... named port of shipment)

FOB - FREE ON BOARD Responsibilities

Group C: Shipment Terms - Main carriage paid.

CFR - COST AND FREIGHT (... named port of destination)

CFR - COST AND FREIGHT Responsibilities

CIF - COST, INSURANCE AND FREIGHT (... named port of destination)

CIF - COST, INSURANCE AND FREIGHT Responsibilities

CPT - CARRIAGE PAID TO (... named place of destination)

CPT - CARRIAGE PAID TO Responsibilities

CIP - CARRIAGE AND INSURANCE PAID TO (... named place of destination)

CIP - CARRIAGE AND INSURANCE PAID TO Responsibilities

Group D: Arrival Terms.

DAF - DELIVERED AT FRONTIER (... named place)

DAF - DELIVERED AT FRONTIER Responsibilities

DES - DELIVERED EX SHIP (... named port of destination)

DES - DELIVERED EX SHIP Responsibilities

DEQ - DELIVERED EX QUAY (... named port of destination)

DEQ - DELIVERED EX QUAY Responsibilities

DDU - DELIVERED DUTY UNPAID (... named place of destination)

DDU - DELIVERED DUTY UNPAID Responsibilities

DDP - DELIVERED DUTY PAID (... named place of destination)

DDP - DELIVERED DUTY PAID Responsibilities

Getting Paid

Pricing Your Product

Shipping Costs Exercise

Calculate Shipping Costs

International Sales Contract

Payment Terms

Payment In Advance
Letter Of Credit

Letter Of Credit Origin
Parties To A Letter Of Credit

Buyer
Opening Bank
Advising Bank
Confirming Bank
Paying Bank
Beneficiary

Letter Of Credit Types

Revocable versus Irrevocable
Confirmed versus Advised
Straight versus Negotiation
Sight versus Usance

Requesting A Letter Of Credit
Sample Form For Requesting A Letter Of Credit
Receiving A Letter Of Credit
Presenting A Letter Of Credit
Common Mistakes Made With Letters Of Credit

Conclusion