Study Guide

Objective

Students will be competent in assessing a company's readiness for foreign trade and initiating the entire export/import process step by step. Students will possess knowledge of the practical aspects of the foreign trade process and will be able to create necessary documentation for delivery, insurance, and payment procedures of the operation. Students will learn how different phases and decisions of the export process will affect each other and how these decisions will influence pricing, profit margin, risks, logistics, and legal obligations. Students will gain knowledge for choosing suitable payment terms and methods and managing risks and sanctions for the operation.

Content

Foreign trade practices:
- Controlled foreign business transactions – from offer to delivery and follow-up
- Phases of the export operation process and mutual dependence of them in the process
- How terms of payment and terms of delivery are dependent on each other
- Contract and how it affects pricing, contribution margin, risks, logistic solutions, and legal obligations of authorities
- EU obligations for the documentation of internal and external trade
- EU’s demands for different processes in foreign trade

Contract, delivery, Incoterms, and documentation:
- Documentation of foreign trade – what information is needed in the documentation
- Documentation requirements and regulations given by authorities in foreign trade (requirements for custom, statistics, and documents of origin)
- Incoterms 2010 – How terms of delivery will affect transport insurance and documentation

Payments in foreign commerce:
- Choosing the right method and term of payment (documentary collection, documentary credit, standby letter of credit)
- Needed documentation based on terms of payment

Financing foreign operations:
- Bank guarantee in foreign trade
- Financing foreign operations
- Managing risks and sanctions

Qualifications

- Basic Studies
- Cross Cultural Business

Assessment criteria, satisfactory (1)

The student can explain the main phases of the export/import process. The student is familiar with some aspects of the foreign trade process and is able to create sufficient documentation for a foreign operation. He/she can recognize some links between export decisions and pricing, profit margin, risks, logistics, and legal obligations. The student can choose a passable payment term and method for the case.

Assessment criteria, good (3)

The student can initiate the entire export/import process in detail. The student is familiar with the practical aspects of the foreign trade process and is able to create some documentation for delivery, insurance, and payment procedures for a foreign operation. The student can explain the main phases of the export process. He/she can explain some links between export decisions and pricing, profit margin, risks, logistics, and legal obligations. The student can choose a passable payment term and method for the case and is able to foresee some risks and sanctions of the case operation.

Assessment criteria, excellent (5)

The student can assess a company's readiness to foreign trade and initiate the entire export/import process in detail. The student is familiar with the practical aspects of the foreign trade process and can create necessary documentation for delivery, insurance and payment procedures for a foreign operation. The student knows the different phases of the export process. He/she can explain how decisions related to export operation will influence pricing, profit margin, risks, logistics and legal obligations. The student can choose suitable payment terms and methods for the case and is able to foresee the main risks and sanctions of the case operation.