Countertrade Essay Example

whereby the right to sell Pepsi products in the country was exchanged for Pepsi Cola syrup. As part of this deal, exclusive rights to sell vodka products in the US were granted to PepsiCo, with a balanced swap of Pepsi syrup for vodka completing the exchange. Coca Cola also engaged in countertrade by establishing a joint venture in Turkey.

According to The Barternews (reprinted from 1998), Turkey and Coca Cola made a countertrade deal. Under this agreement, Turkey would produce tomato paste for the plant while Coca Cola would offer technology and management services. This partnership aimed to create products not only for the U.S. market but also for other markets. The article highlights the importance of countertrade in managing risks.

Countertrade is crucial in risk management as it can prevent potential issues and failures in such transactions. The product market's performance plays a significant role in determining transaction outcomes. It is essential to distinguish between government and private companies when managing risks before entering into countertrade deals. Before signing a countertrade agreement, examining the company's financial credit, reputation and statements is vital. For information on countertrade for both companies and countries, the U.S Department of Commerce Country Desk is a reliable source.

When initiating a countertrade, it is crucial to assess the security state of the country. This evaluation can be done by referring to the embassy, annual reports, internal credit reporting companies, and the World Trade Center headquartered in that particular nation. According to West (2002), being aware of the security status of a country is vital to ensure the protection of personal safety and business investments. A company should also determine whether it is practical

to travel abroad for meetings and fostering partnerships when initializing a countertrade.

It is advisable for a company to verify the financial institution responsible for processing transactions and not rely solely on representations. Utilizing resources like the Bankers Almanac can assist the company in obtaining useful information. Smaller companies exploring countertrade options may benefit from employing a country agent, who has a better understanding of the country's market, regulations, and major players.

It is important to evaluate tariffs on imports and exports to determine their impact on the country. Additionally, companies involved in marketing products should be aware of the potential assumption of risk by third parties (West, 2002). When assessing resources for managing risks in countertrade, international students in the U.S. should also be considered. These individuals often come from affluent backgrounds and can provide valuable insights into their respective countries and markets.

By leveraging international students, institutions can reduce travel costs and time. Information about international student associations is typically available upon request from colleges and universities (West, 2002). Ultimately, countertrade facilitates global product exchange and is made possible by the diversity of nations like this one (BarterNews, 1998).

On the Website http://www.barternews.com/approach_marketing.htm, Hill, C. can be found. The retrieval date was September 8, 2008.

International Business: Competing in the Global Market Place by W. (2009).

The book "7th ed." is published in New York by McGraw-Hill/Irwin and is referenced by Investopedia in 2008.The website Investopedia provides information on Hard Currency, which can be retrieved on September 7, 2008. The relevant link is http://www.investopedia.com.

West, D. (July, 2005). "London Countertrade Roundtable." Retrieved from http://www.witiger.com/internationalbusiness/countertrade.htm.

The article on business credit dated April 1, 2002 is accessible on http://www.business.com and remains available

as of September 5, 2008.