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Front 1

Contractual entry strategies in international business

Back 1

cross border exchanges where the relationship between the focal firm and its foreign partner is governed by an explicit contract

Front 2

Intellectual property rights

Back 2

the legal claim through which the proprietary assets of firms and individuals are protected from unauthorized use by other parties

Front 3

royalty

Back 3

a fee paid periodically to compensate a licensor for the temporary use of its intellectual property; often based on a percentage on gross sales generated from using the licensed asset

Front 4

know how agreement

Back 4

contract in which the focal firm provides technological or management knowledge about how to to design, manufacture, or deliver a product or a service

Front 5

master franchise

Back 5

arrangement in which an independent company is licensed to establish, develop, and manage the entire franchising network in its market and has the right to subfranchise to other franchisees, thus assuming the role o local franchisor

Front 6

build operate transfer

Back 6

arrangement in which the firm or a consortium of firms contracts to build a major facility abroad, operate it for a specified period, and then hand it over to the project sponsor, typically the host country government or public, utility.

Front 7

management contract

Back 7

arrangement in which a contractor supplies managerial know how to operate a hotel, resort, hospital, airport, or other facility in exchange for compensation

Front 8

infringement of intellectual property

Back 8

unauthorized use, publication, or reproduction of products or services that are protected by a patent, copyright, trademark, or other intellectual property right.

Front 9

global marketing strategy

Back 9

a plan of action that guides the firm in how to position itself and tis offering in foreign markets, which customer segments to target, and the degree to which its marketing program elements should be standardized and adapted

Front 10

global market segment

Back 10

a group of customers that share common characteristics across many national markets

Front 11

adaptation

Back 11

firm efforts to modify one or more elements of its international marketing program to accommodate specific customer requirements in a particular market

Front 12

standardization

Back 12

firm efforts to make its marketing program elements uniform, with a view to targeting entire regions, or even the global marketplace, with a similar product or service

Front 13

global brand

Back 13

a brand whose positioning, advertising strategy, look, and personality are standardized worldwide

Front 14

gray market activity

Back 14

legal importation of genuine products into a country by intermediaries other than authorized distributors (also known as parallel imports)

Front 15

international price escalation

Back 15

the problem of enduser prices reaching exorbitant levels in the export market caused by multilayered distribution channels, intermediary margins, tariffs, and other international customer costs

Front 16

transfer pricing

Back 16

the practice of pricing intermediate or finished products exchanged among the subsidiaries and affiliates of the same corporate family located in different countries

Front 17

global account management

Back 17

servicing a key global customer in a consistent and standardized manner, regardless of where in the world it operates

Front 18

international human resource management

Back 18

the planning, selection, training, employment, and evaluation of employees for international operations

Front 19

host-country national

Back 19

an employee who is a citizen of the country where the MNE subsidiary or affiliate is located

Front 20

parent-country national

Back 20

an employee who is a citizen of the country where the MNE is headquartered

Front 21

third country national

Back 21

an employee who is a citizen of a country other than the home or host country

Front 22

expatriate

Back 22

an employee who is assigned to work and reside in a foreign country for an extended period, usually a year or longer

Front 23

expatriate failure

Back 23

the premature return of an employee from an international assignement

Front 24

culture shock

Back 24

confusion and anxiety, often akin to mental depression, that can result from living in a foreign culture for an extended period

Front 25

area studies

Back 25

factual knowledge of the historical political and economic environment of the host country

Front 26

practical information

Back 26

knowledge and skills necessary to function effectively in a country, including housing, health care, education, and daily living

Front 27

cross-cultural awareness

Back 27

ability to interact effectively and appropriately with people from different language and cultural backgrounds

Front 28

repatriation

Back 28

the return of the expatriate to his or her home country following the completion of a lengthy foreign assignment

Front 29

cultural intelligence

Back 29

the capability of an employee to function effectively in situations characterized by cultural diversity

Front 30

global talent pool

Back 30

a searchable database of employees, profiling their international skill sets and potential for supporting the firm's global aspirations

Front 31

global team

Back 31

an internationally distributed group of people with a specific mandate to make or implement decisions that are international in scope

Front 32

performance appraisal

Back 32

the formal processes of assessing how effectively employees perform their jobs

Front 33

collective bargaining

Back 33

collective negotiations between management and hourly labor and technical staff regarding wages and working conditions

Front 34

codetermination

Back 34

an industrial relations practice where labor representatives sit on the corporate board and participate in company decision making

Front 35

equity financing

Back 35

the issuance of shares of stock to raise capital from investors an the use of retained earnings

Front 36

debt financing

Back 36

the borrowing of money from banks or other financial intermediaries, or selling corporate bonds to individuals or institutions to raise capital

Front 37

global money market

Back 37

the collective financial markets where firms and governments raise short-term financing

Front 38

global capital market

Back 38

the collective financial markets where firms and governments raise intermediate-term and long-term financing

Front 39

global equity market

Back 39

the worldwide market of funds for equity financing- the stock exchanges throughout the world where investors and firms meet to buy and sell shares of stock

Front 40

Eurodollars

Back 40

US dollars held in banks outside the United States, including foreign branches of US banks

Front 41

Eurocurrency

Back 41

Any currency deposited in a bank outside its country of origin

Front 42

bond

Back 42

debt instrument that enables the issuer (borrower) to raise capital by promising to repay the principal along with interest on a specified date (maturity)

Front 43

global bond market

Back 43

the international marketplace in which bonds are bought and sold, primarily through banks and stockbrokers

Front 44

foreign bond

Back 44

a bond sold outside the issuers country and denominated in the currency of the country in which it is issued

Front 45

eurobond

Back 45

a bond sold outside the issuer's home country but denominated in its own currency

Front 46

intracorporate financing

Back 46

funds provided from sources inside the firm (both the headquarters and subsidiaries) such as equity, loans, and trade credits

Front 47

fronting loan

Back 47

a loan between the parent and its subsidiary, channeled through a large bank or other financial intermediary

Front 48

tax haven

Back 48

a country hospitable to business and inward investment because of its low corporate income taxes

Front 49

multilateral netting

Back 49

strategic reduction of cash transfers within the MNE family through the elimination of offsetting cash flows

Front 50

transaction exposure

Back 50

the currency risk that firms face when outstanding accounts receivable or payable are denominated in foreign currencies

Front 51

translation exposure

Back 51

the currency risk that results when a firm translates financial statements denominated in a foreign currency into the functional currency of the parent firm, as part of consolidating international financial results

Front 52

consolidation

Back 52

the process of combining and integrating the financial results of foreign subsidiaries into the financial statements of the parent firm

Front 53

economic exposure

Back 53

the currency risk that results from exchange rate fluctuations affecting the pricing of products, the cost of inputs, and the value of foreign investments

Front 54

spot rate

Back 54

the exchange rate applicable to the trading of foreign currencies in which the current rate of exchange is used and delivery is considered immediate

Front 55

forward rate

Back 55

the exchange rate applicable to the collection or delivery of a foreign currency at some future date

Front 56

direct quote

Back 56

the number of units of the domestic currency needed to acquire one unit of the foreign currency (also known as the normal or American quote)

Front 57

indirect quote

Back 57

the number of units of the foreign currency obtained for one unit of the domestic currency (also known as the reciprocal or European/Continental terms)

Front 58

hedgers

Back 58

currency traders who seek to minimize the risk of exchange rate fluctuations, often by buying forwards or similar financial instruments

Front 59

speculators

Back 59

currency traders who seek profits by investing in currencies with the expectation that they will rise in value in the future