What Are the Similarities and Differences Between Domestic and International Marketing?

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process. For instance, if a company is trying to implement a strategy that will differentiate their products, its operations managers should be focused on creating products that are clearly distinguishable from those of competitors. This strategy will most likely require the company to acquire high quality inputs and equipment’s. If the firm is following a cost leadership strategy, its operations management system should emphasize cost control, and the input quality would be less important than cost.

6. What types of information are particularly important to an international firm? (Chapter 17, #7)

Any data that can improve a manager’s decision is important. It is important that the data be timely, accurate, and relevant and it is needed on every aspect of the firm’s environment. For the international firm, getting together appropriate data is more intricate because it may come in multiple languages, multiple currencies, and from multiple regulatory environments.

7. What are the advantages and disadvantages of each method of payment for international transactions from the exporter’s perspective? (Chapter 18, #1)

The most desirable form of payment from the exporter’s perspective is payment in advance in the exporter’s currency. The first choice of an importer would be an open account and would be considered much less desirable because the importer may fail to pay the account balance. Collection of documents are common and involves a legally enforceable debt instrument. The exporter faces the risk that the importer might default or fail to accept a draft. This risk can be minimized using a letter of credit but the fees are associated with buying this kind of “insurance against failure to pay.” Countertrade may be appropriate if the exporter acquires goods that are easily resold, but could be problematic if the countertraded goods are not saleable.

8. How does capital budgeting for international projects differ from that for domestic projects? (Chapter 18, #4)

While many of the same methods of project evaluation are used, capital budgeting for international projects fluctuates from that of domestic projects in several ways. First, a company that uses the net present value technique for evaluating projects must consider risk adjustments, currency selection, and the choice of perspective for the calculations. Second, a firm that uses the internal rate of return method of evaluation will probably have different hurdle rates to account for differences in risk among countries while a domestic firm would have just one.

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