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Ecosystem of Foreign Trade

The document discusses foreign trade in the US and options for foreign companies to distribute products in the US market. It notes that throughout history, the US has relied heavily on importing raw materials and exporting finished goods. In the 1920s, policies under President Harding reduced taxes and protected US business and agriculture. For foreign companies, using an agent or distributor are common intermediary distribution channels that allow testing the market without a permanent presence. The distributor or agent will then market products according to the agreed terms.

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Akshay poply
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22 views

Ecosystem of Foreign Trade

The document discusses foreign trade in the US and options for foreign companies to distribute products in the US market. It notes that throughout history, the US has relied heavily on importing raw materials and exporting finished goods. In the 1920s, policies under President Harding reduced taxes and protected US business and agriculture. For foreign companies, using an agent or distributor are common intermediary distribution channels that allow testing the market without a permanent presence. The distributor or agent will then market products according to the agreed terms.

Uploaded by

Akshay poply
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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ECOSYSTEM OF FOREIGN TRADE

 U.S.A has varied widely through various American historical and industrial periods. As a
major developed nation, the U.S. has relied heavily on the import of raw materials and the
export of finished goods. Because of the significance for American economy and industry,
much weight has been placed on trade policy by elected officials and business leaders.
 The 1920s marked a decade of economic growth in the United States following a Classical
supply side policy U.S. President Warren Harding signed
 the Emergency Tariff of 1921 and the Fordney–McCumber Tariff of 1922. Harding's policies reduced taxes
and protected U.S. business and agriculture.

FOREIGN DIRECT INVESTEMENT


• What to consider if you invest in the United States
• The U.S. has a population of over 320 million people with a high GDP per capita
• The US has the first world economy, solid and performance in various sectors
• A dominant position in R&D
• A flexible and reactive employment market
• A very good quality of national statistics
• Public debt mainly held by Americans
• The American workforce has a comparatively high level of qualifications and is
considered to be one of the most productive and innovative in the world
DISTRIBUTION CHANNELS IN THE UNITED STATES OF AMERICA: AGENT OR
DISTRIBUTOR?

Many foreign companies wish to establish a commercial presence abroad, especially in the United
States of America. The first thing that comes to mind is how to establish a presence and ensure that
products are distributed in the United States in an efficient way, i.e., with the least expenditure of
money. The exporter may use intermediary channels of distribution, such as an agent or a distributor
if (i) the exporter is not financially strong to form and maintain a subsidiary or (ii) he prefers to
confirm the level of acceptance of the new product abroad before establishing a permanent
presence. The agent or the distributor, as the case may be, will market the products according to the
terms and conditions agreed with the exporter.

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