INTERNATIONAL

TRADE

Presented by:
Doris F. Bernasol
LEARNING
FOCUS • How the Internet
Facilitates International
Trade
• Licensing
• How the Internet
Facilitates Licensing
• Franchising
• Joint Ventures
INTRODUCTION
International trade is a relatively
conservative approach that can be
used by firms to penetrate markets
(by exporting) or to obtain supplies at
a low cost (by importing). This
approach entails minimal risk because
the firm does not place any of its
capital at risk. If the firm experiences
a decline in its exporting or importing,
it can normally reduce or discontinue
this part of its business at a low cost.
HOW THE INTERNET
FACILITATES
INTERNATIONAL
TRADE
 HOW THE INTERNET FACILITATES
INTERNATIONAL TRADE

Many firms use their websites to list the

products that they sell, along with the price
for each product.
This allows them to:
• Advertise their products easily
• Add product lines or change price
• Importers can easily monitor the exporter’s
website
• Accept orders online easily
• Software products can easily be delivered
to the importer
Sample Footer Text
LICENSING AND
HOW THE INTERNET
FACILITATES
LICENSING
LICENSING

Licensing obligates a firm to provide its

technology (copyrights, patents, trademarks,
or trade names) in exchange for fees or
some other specified benefits.
Some examples of things that may be licensed
include songs, sports team logos, intellectual
property, software, and technology.
Licensing agreements allow parties to
control property and enter new markets
without having to spend the money to do so.
HOW THE INTERNET FACILITATES LICENSING

Some firms with an international reputation use

their brand name to advertise products over the
Internet. They may use manufacturers in
foreign countries to produce some of their
products subject to their specifications.
Example:
Suppose Apple, a manufacturer and seller of
iPhone, was based in the US and wanted to
expand to the Philippine market with an
international business license. They can enter
the agreement with a Philippine firm, allowing
them to use their product patent and giving
other resources, in return for a payment.
FRANCHISING
FRANCHISING

Franchising obligates a firm to provide a

specialized sales or service strategy, support
assistance, and possibly an initial investment
in the franchise in exchange for periodic
fees. For example, Jollibee, McDonald’s,
Pizza Hut, Seven Eleven, etc.
JOINT VENTURES
JOINT VENTURE

A joint venture is a venture that is jointly

owned and operated by two or more firms.
Many firms penetrate foreign markets by
engaging in a joint venture with firms that
reside in those markets. Most joint ventures
allow two firms to apply their respective
comparative advantages in a given project.
For example, General Mills, Inc., joined in a
venture with Nestlé SA, so that the cereals
produced by General Mills could be sold
through the overseas sales distribution
network established by Nestlé.
THE WAY TO GET
STARTED IS TO QUIT
TALKING AND BEGIN
DOING.

Walt Disney
THANK YOU
DORIS F. BERNASOL
dorisbernasol@pcf.edu.ph