International Trade International Trade TransactionTransaction

6th Lecture6th Lecture

Steps for market-entrySteps for market-entry 1. 1.On the behalf of / for the account /at the On the behalf of / for the account /at the

risks of his principal:risks of his principal: Sales representativeSales representative→ not subject to → not subject to

VAT tax law; Not entitled to conclude a VAT tax law; Not entitled to conclude a concrete dealconcrete deal; fixed salaried; employee;; fixed salaried; employee;

AgentAgent→ professional; commission fee; → professional; commission fee; Types: Types: salaried (retainer;) stockiest; salaried (retainer;) stockiest;

consignment stokiconsignment stokieest;st; after-sale after-sale services; del credere;services; del credere;

Steps for market entry 2.Steps for market entry 2.On the behalf of / for the account of/ at the On the behalf of / for the account of/ at the

risks of his own;risks of his own;

DistributorDistributor→ contract of sale and contract of → contract of sale and contract of agencyagency;; mark-up; full liability for the mark-up; full liability for the products towards customers; Liable jointly products towards customers; Liable jointly and severally towards consumers; takes on and severally towards consumers; takes on financial (liquidity), performance risks as financial (liquidity), performance risks as well;well;

Types of distributors: after-sale service, Types of distributors: after-sale service, stockiest;stockiest;

Re-exporter:Re-exporter:

Types: covered vs. not-covered; transitor;Types: covered vs. not-covered; transitor;

Steps for market entry Steps for market entry 3.3.

OOn the behalf of his own, but for the n the behalf of his own, but for the accountaccount of of and at the risk of his principal: and at the risk of his principal:

Export-management companyExport-management company→ contract of → contract of sale with the foreign partner+ contract of sale with the foreign partner+ contract of agency with the domestic partneragency with the domestic partner; Limit ; Limit price;price; Commission feeCommission fee +Premium;+Premium;

Takes on all potential liability towards Takes on all potential liability towards foreign partner because it acts as if it foreign partner because it acts as if it were the original supplier/or final were the original supplier/or final purchaser;purchaser;

Steps for market entry Steps for market entry 4.4.

Trading House: all functions, but especiallyTrading House: all functions, but especially

Financing; Financing;

Aggregating the demand and the supplyAggregating the demand and the supply→ → having the large-scale position;having the large-scale position;

All linked operations: warehousing, All linked operations: warehousing, transportation, logistic services;transportation, logistic services;

Clerical work; Clerical work;

Sogo shosha; London specialized in;Sogo shosha; London specialized in;