In this chapter, you will learn about: The proliferation & importance of imported products, gray markets, consumer attitudes about american-made versus foreign-made goods, finding international vendors & intermediaries, shipping costs & getting goods through U.S. customs.
Ch. 8: International Vendors • The proliferation & importance of imported products • Gray markets • Consumer attitudes about Americanmade versus foreignmade goods • Findinginternationalvendors&intermediaries Shippingcosts&gettinggoodsthroughU.S. Customs Copyright â 2006 by John Wiley & Sons, Inc All rights rese Why Buy Internationally? • Lower costs • U.S. shoppers no longer “swear loyalty” to Americanmade brands when price is a factor • Americanmade markets no longer exist for some types of goods (notably electronics) • International market offers wider range of products to choose from in trendsetting categories (clothing, wine, vehicles, etc.) Copyright © 2006 by John Wiley & Sons, Inc All rights rese Gray Market (Parallel Imports) Goods PROS CONS • Name brands available at much lower prices • A way for U.S. consumers to “fight back” against high prices • High profitability for deep discounters • Ethical & legal concerns about trademark infringement • Legal questions of products’ “material difference” • Damage to image, reputation of name branded products Copyright © 2006 by John Wiley & Sons, Inc All rights rese Buying Foreign Goods from Domestic Sources • Import merchant Wholesaler who usually stocks, sells one type or category of product • Resident sales agent Represents multiple foreign manufacturers May or may not have product on hand • Importcommissionhouse Representsmultipleforeignmanufacturers Imports&storesgoods Paidoncommissionbymanufacturers Buyingoffice Internationalofficesrepresentretailers,locateproduct &negotiatewithmanufacturers Copyright â 2006 by John Wiley & Sons, Inc All rights rese Buying Foreign Goods from Foreign Sources • Foreign export merchant Wholesaler whose business is strictly exporting • Export sales representative Sells the manufacturer’s goods to retailers Shows samples but maintains no inventory • Export commission house May represent multiple foreign manufacturers Paid on commission by manufacturers Copyright © 2006 by John Wiley & Sons, Inc All rights rese Buying Foreign Goods from Foreign Sources (continued) • Foreign freightforwarder Licensed by U.S. Maritime Commission to arrange shipping, proper documentation on behalf of exporters • Commissionaire or purchasing agent Buying office that helps international buyers do business in nation where office is located • Customs house broker Represents retailer by doing paperwork, paying duties, ensuring imported shipments meet U.S. Customs laws & requirements Copyright © 2006 by John Wiley & Sons, Inc All rights rese Customs Decisions for Every Shipment • Duty rates – General rates, special rates, “Column 2” rates • Types of duties – Ad valorem, specific, compound • Value(onwhichduty&ratearebased) foreignvalue,exportvalue,constructedvalue FormalentryForshipmentsworthmore than$2,000invalue;requiresabondfrom theimporter Copyright â 2006 by John Wiley & Sons, Inc All rights rese ... • Buying office International offices represent retailers, locate product & negotiate with manufacturers Copyright © 2006 by John Wiley & Sons, Inc All rights rese Buying Foreign Goods from Foreign Sources... shipping, proper documentation on behalf of exporters • Commissionaire or purchasing agent Buying office that helps international buyers do business in nation where office is located •... Customs Decisions for Every Shipment • Duty rates – General rates, special rates, “Column 2” rates • Types of duties – Ad valorem, specific, compound • Value (on which duty & rate are based) – foreign value, export value, constructed value