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Licensing and Joint Ventures

"...advantage of licensing or joint venture is that you earn some money rather than none..."

Market research may reveal that it is impossible to export your product to a foreign country because of import barriers, low-priced foreign competition, transportation costs, high production costs, etc.

The possibility of licensing a local firm to manufacture and market your product within that market, paying you a royalty for each unit locally manufactured.

Or you may wish to consider a joint venture with a local firm and enter into partnership to manufacture and market the product together.

Such agreements usually involve the use of the exporter's trademarks, patents technical know-how, specialized equipment, training, etc. and the local partner's buildings, labor force, permits, contacts, etc.


Site Contents for:
How to develop your export market?

Page 1 How to develop your export market?

Page 2 How to benefit from export merchant or agent?

Page 3 About Foreign Distributor & Import Agent

<< This Page 4 Socialist Countries Licensing and Join Venture

Page 5 Sales Procedure for Export Export Contract

Page 6 Incoterms describe the responsibilities of seller and buyer





The advantage of licensing or a joint venture
is that you earn some money rather than none.

The disadvantages are that:

  • 1. It may be difficult to find a suitable local firm.
  • 2. You may lose control of your technical "know-how".
  • 3. Your local partner may not fulfill his part of the agreement.
  • 4. The licenses may become an eventual competitor.

Foreign Broker

A specialized type of import agent who usually deals in primary commodities such as foodstuffs and minerals.

He usually handles very large quantities of the items and charges a commission for his services. He can bring together seller and buyer and help negotiate sales agreements.



Page 7 Definitions of INCOTERMS trade terms

Page 8 About commercial disputes and arbitration

Page 9 About The World Trade Center Association

Page 10 Direct Export & Indirect Export Procedures 




Socialist Countries

There are currently 14 socialist countries in the world, below are are some example:

  • People's Republic of China

  • Republic of Cuba

  • Lao People's Democratic Republic

  • Socialist Republic of Vietnam

  • Democratic Republic of Afghanistan

The usual procedure for selling to socialist countries is to identify the appropriate import and export Corporation that handles your type of product and then write to it, enclosing all possible information about your company and its products.

If they are interested, the import and export Corporation will contact you with further queries.

After several meetings and some hard bargaining, you may end up with an export order. The process may be lengthy as all imports must usually be approved centrally and conform with annual Trade Plan.

It must be emphasized that Socialist Country, although centrally planned, vary considerably in the amount of delegated authority to local trade bodies. So methods and results can also vary considerably.

Next page 5/10 Sales Procedure for Export
Export Sales Contract
"...adopting General Standard Conditions is legally binding, whether or not both parties are aware of or understand, every provision..."



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Site Contents for:
How to develop your export market?


Site Contents for:
Secrets of
International Trade


Can't find What You Want? Try Google...

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