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International Supply chain > Midterm Exam > Flashcards

Midterm Exam Flashcards

1
Q

Define Logistics

A

the part of the sc process that plans, implements, and controls the forward and reverse flow /storage of goods, services, etc.

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2
Q

Define supply chain management

A

Management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all Logistics Management activities.

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3
Q

Define Outsourcing

A

obtain (goods or a service) from an outside or foreign supplier, especially in place of an internal source.

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4
Q

Define Reverse Logistics

A

a type of supply chain management that moves goods from customers back to the sellers or manufacturers.

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5
Q

How did the Germans approach reverse Logistics?

A

: require
companies to recycle all packaging, and
creating a post-consumer recycling program

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6
Q

How did Curitiba approach reverse logistics?

A

using recycling as an
anti-poverty program

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7
Q

The environment in which international logisticians operate is quite ______ from the domestic environment.

A

different

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8
Q

The inherent risks and hazards of international transportation are much_____

A

greater

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9
Q

International means of payment are more _______.

A

complicated

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10
Q

What made international shipping more efficient and faster?

A

The creation of multiple international institutions facilitated international trade
Reduction in transportation costs and transit times
Greater acceptance of “things foreign”

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11
Q

Define Adam Smith’s absolute advantage theory

A

If a country can produce a certain good more efficiently than other countries, it will trade with countries that produce other goods more efficiently

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12
Q

Define David Ricardo’s comparative advantage theory

A

Nations will trade with one another as long as they can produce certain goods relatively more efficiently than one another

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13
Q

Define Hector and Olin’s factor endowment theory

A

A country will enjoy a comparative advantage over other countries if it is naturally endowed with a greater abundance of one of the factors of economic production.

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14
Q

Raymond Vernon’s international product life cycle theory

A

Over its life, a product will be manufactured in different types of countries, in stages, generating trade between these countries

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15
Q

Michael Porter’s Cluster theory

A

Competitive clusters form when companies in the same industry, as well as their suppliers, concentrate in one geographic area.

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16
Q

Logistics cluster theory by Sheffi

A

Logistics clusters form when logistics companies concentrate in one geographic area.

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17
Q

Numerical example of Absolute Advantage theory :

France: 20,000 wine; 2 Machinery
Germany: 15,000 wine; 3 machinery

A

In this case, both countries are using the same amount of labor to produce these alternatives. France will specialize in making wine, and Germany will specialize in making machinery.

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18
Q

Numerical example of Comparative Advantage theory:

UK: 25 Tons of Wheat; 5 units of machinery
Brazil: 21 tons of wheat; 3 units of machinery

A

The nations will trade: If the UK sells 1 unit of machinery to Brazil for 6 units of wheat, both the UK and Brazil are better off. The UK has a comparative advantage in producing machinery, Brazil in growing wheat.

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19
Q

What are the international Trade drivers?

A

cost drivers
competitive drivers
market drivers
technology drivers

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20
Q

Cost drivers

A

Companies increase their sales worldwide to recover their high investment costs.

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21
Q

competitive drivers

A

Companies enter foreign markets to keep up with their competitors , retaliate against them, or enter a market first.

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22
Q

market drivers

A

Companies enter foreign markets because their customers expect them to be present in those countries.

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23
Q

technology drivers

A

Companies enter foreign markets because their customers use technology to make purchases from these markets

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24
Q

communication infrastructure

A

allows businesses to communicate clearly and quickly. This requires reliable phone lines, cell phone networks, internet service, and mail delivery

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25
Q

How is leapfrogging a problem in infrastructure?

A

Some countries never build infrastructure in one technology, and “leapfrog” into the next one. (Gabon)

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26
Q

Marketing Subsidiary

A

a company that another company owns or controls.

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27
Q

The subsidiary is also called the _____ (holding) company, and owns at least ____ of voting stock

A

Parent, 50%

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28
Q

Green field operations

A

type of foreign direct investment (FDI) in which a parent company creates a subsidiary in a different country, building its operations from the ground up.

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29
Q

What happens in indirect exporting?

A

Exporter does not seek export sales.
Allows manufacturer to concentrate on domestic market and leave exporting to the experts.

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30
Q

export trading company (ETC)

A

a firm with offices in multiple countries that purchases goods in one country and resells them in another.

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31
Q

For the ______selling to the ETC, as well as for the _____ buying from the ETC, the transactions are ______transactions, even though the goods eventually travel internationally

A

exporter, importer, domestic

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32
Q

An export management corporation (EMC) is normally located in the _____ country

A

exporting

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33
Q

The EMC acts as a representative for the exporter abroad, but never takes title to the goods. Instead, what does it do?

A

acts as a facilitator helping the exporter find buyers and earns a commission on the sale.

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34
Q

Piggy backing

A

refers to the possibility of a small firm piggy-backing on another firm’s efforts to enter a foreign market

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35
Q

Piggy backing example: A firm utilizes another company’s distribution channels abroad to sell its products. It uses another company’s _______ to sell its products abroad.

A

experience

36
Q

What happens in active exporting?

A

Exporter actively participates in finding potential markets abroad.
Best option for large firms or firms with international experience.

37
Q

Agent

A

typically a small firm or individual located in the importing country. The agent will act as a representative of the exporter.

38
Q

Distributor

A

typically located in the importing country. The distributor will purchase the goods from the exporter and therefore take title of them

39
Q

Distributors are typically much larger than agents and therefore fall under _____ law, while agents fall under _____ law.

A

contract, protection of labor

40
Q

Subsidiary (WOFE)

A

an independent company established in a foreign country but owned entirely by the exporting company.

41
Q

A subsidiary allows the foreign firm to retain _____ of the foreign investment

A

complete control

42
Q

What’s the phenomenon of parallel imports ?

A

firms will sell goods in different markets at different prices, methods of entry, characteristics of the market, and varying exchange rates.

43
Q

Liner Service

A

Fixed schedule
Conferences
Bill of Lading (evidencing contract of carriage)
Master of the vessel issues B/L
Break-bulk cargo (containerized ships)
Carrier / shipper
Mandatory liability based on conventions
Freight forwarders / Customs house agents

44
Q

Charter Service (Tramp)

A

Supply and demand
No fixed schedule
Bulk cargo (tanker and dry cargo)
Ship-owner / charterer
Contract for transportation (chartering) / contract of affreightment
Charterer issues B/L
Baltic Exchange

45
Q

Panamax Vessel

A

A ship of the maximum size that can enter the locks of the Panama Canal ; 110 feet wide, 1000 feet long.

46
Q

Post Panamax Vessel

A

A ship that is too large to enter the locks of the Panama Canal.

47
Q

Handy Size Vessel

A

A ship in the 10,000 to 50,000 dead-weight ton range.

48
Q

Suez Canal Vessel

A

A ship roughly 150,000 dead-weight tons, the maximum size that can fit through the Suez Canal.

49
Q

Cape Size Vessel

A

A large dry-bulk carriers of a capacity greater than 80,000 dead-weight tons.

50
Q

Aframax vessel

A

A large oil carrier of a capacity between 80 and 120,000 dead-weight tons.

51
Q

A Very large Crude Carrier (VLCC) is an oil tanker of _____ 300,000 deadweight ton range , while an ultra large crude carrier (ULCC) oil tanker has ______ 300,000 deadweight ton range

A

up to, more than

52
Q

A very Large Ore Carrier (VLOC) has more than _____ deadweight ton range while an Ultra Large Ore Carrier (ULOC) has more than _____ deadweight ton range

A

200,000 ; 300,000

53
Q

Wet bulk

A

liquid cargo that is loaded directly into the hold of a ship

54
Q

Dry Bulk

A

dry cargo that is loaded directly into the hold of a ship; takes the shape of the hold. Grain, for example.

55
Q

Breakbulk

A

cargo that is packaged (bales, boxes, drums, crates, pallets) but not containerized. Vehicles are also considered break-bulk cargo.

56
Q

containers

A

Cargo that is placed in containers before it is loaded onto a ship. containers are metallic boxes that are 8.5 x 8 x 20 or 8.5 x 8 x 40 feet.

57
Q

What are some freight charges ?

A

Abritray Charge ; Cleaning fee (ARB)
Bunker Adjustment Factor (Surcharge)
Currency Adjustment Factor (CAF)

58
Q

Packaging security issues center around

A

pilferage and theft

59
Q

Good packaging security practices include

A

Tamper-proof seals on all FCL shipments.
Measures designed to hide the nature of the goods being shipped (making secondary packaging “anonymous”).
Measures designed to keep shipment information confidential.

60
Q

The tariff structure on international air cargo is much simpler than that used by the ocean cargo industry. This is likely because

A

It is based on the weight and volume of the cargo.

61
Q

The steps of how freight charge is calculated

A
  1. Weight of shipment
  2. Volume weight of shipment (dimensional weight)
  3. Airlines charges the higher of the 2 prices
62
Q

Because of their heavy reliance on fossil fuels,airlines and aircraft manufacturers have been active in reducing the ______ of the industry.

A

carbon footprint

63
Q

some airports close at night to reduce the impact of _____ on the populations living near airports.

A

air traffic

64
Q

Passenger aircraft

A

designed to carry passengers on the main deck(s) and freight on the belly ; ex: airbus 380

65
Q

Cargo aircraft

A

carries cargo on the main deck, can be loaded thru its nose ; ex: Boeing 747F.

66
Q

Passenger to freighter aircraft

A

can be loaded thru a side door ; ex: Boeing 737

67
Q

Combi Aircraft

A

carries both cargo and passengers on the main deck

68
Q

Quick Change Aircraft

A

uses seat pallets on the main deck

69
Q

Intermodal transportation

A

A shipment that takes more than one mean of transportation from its departure to its point of destination, using only one bill of lading

70
Q

International intermodal transportation is strongly linked to the creation of the ________, which is ideally suited to be shipped by truck, train, or ship, and can be easily transferred from one mode of _______to another.

A

container, transportation

71
Q

What are the most common containers

A

40 ft high cube
20 ft

72
Q

extended length container

A

oversized goods can be shipped (45 ft long)

73
Q

Refrigerated containers (reefers)

A

ships Goods that need a controlled-temperature environment

74
Q

Open top containers

A

Ships Goods that cannot fit through the doors of a traditional container

75
Q

Liquids travel in _____ containers

A

liquid bulk

76
Q

Flat rack container

A

ships oversized cargo

77
Q

Barges

A

Ships bulk cargo

78
Q

The increased importance of containerization in intermodal transport has created new transportation models, such as _____ and _______.

A

Land bridges and intermodal yards

79
Q

Land Bridge

A

For goods that are shipped from Asia to Europe, it is often more economical to ship goods by ocean to the West Coast of North America

80
Q

Intermodal Terminal (Dry Port)

A

A location where containerized goods change means of transportation.

81
Q

Because international transportation is so complex, many shippers rely on _______ to handle their international shipments

A

freight forwarders

82
Q

The 11 incoterms rules

A

EXW (Ex Works) …
FCA (Free Carrier) …
CPT (Carriage Paid To) …
CIP (Carriage and Insurance Paid To) …
DAP (Delivered at Place) …
DPU (Delivered at Place Unloaded) …
DDP (Delivered Duty Paid) …
FAS (Free Alongside Ship)
FOB (Free On Board)
CIF (cost insurance and freight)
CFR (Cost and Freight)

83
Q

Scope for most of the incoterms

A

Can be used for any type of goods

84
Q

Modality for most of the incoterms

A

can be used for any mode of transportation.

85
Q

Responsibilities for most of the incoterms (exporter)

A

The exporter must package the goods for the international voyage and provide the importer with the documents necessary

86
Q

Resposnsibilities for most of the incoterms (importer)

A

The importer must do everything else.

87
Q

The Point at which the responsibility for the good shifts from exporter to importer occurs
When _____ or ____

A

the exporter makes the goods available to the importer.
or
the exporter delivers the goods to the first carrier in the exporting country.

International Supply chain (4 decks)

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