IBUS Ch 13

Sogo Shosha
Japan’s great trading houses
Export Management Company
Export specialists who act as the export marketing department for client firms
Letter of Credit
Issued by a bank, indicating that the bank will make payments under specific circumstances
Bill of Exchange
An order written by an exporter instructing an importer, or an importer’s agent, to pay a specified amount of money at a specified time; also called a draft
Draft
An order written by an exporter instructing an importer, or an importer’s agent, to pay a specified amount of money at a specified time
Sight Draft
A draft payable on presentation to the drawee
Time Draft
A promise to pay the accepting party at some future date
Bill of Lading
A document issued to the exporter by the common carrier transporting the merchandise; it serves as a receipt, a contract, and a document of title
Export-Import Bank
Agency of the U.S. government whose mission is to provide aid in financing and facilitate exports and imports; also referred to as the Ex-Im Bank
Countertrade
The trade of goods or services for other goods or services
Barter
The direct exchange of goods and/or services between two parties without a cash transaction
Counterpurchase
A reciprocal buying agreement
Offset
A buying agreement similar to a counterpurchase, but the exporting country can then fulfill the agreement with any firm in the country to which the sale is being made
Switch Trading
The use of specialized third-party trading house in a countertrade arrangement
Buyback
When a firm builds a plant in a country and agrees to take a certain percentage of the plant’s output as a partial payment for the countract