Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Exporting into Argentina

262 views

Published on

Outlines the barriers to enter the Argentine market with an iPod.

Published in: Travel, Business
  • Be the first to comment

  • Be the first to like this

Exporting into Argentina

  1. 1. Exporting the iPod into Argentina Corina Wentzel
  2. 2. Executive Summary <ul><li>Why Argentina </li></ul><ul><li>IT industry increased 19% from 2005 to 2006 </li></ul><ul><li>Over 40 million citizens </li></ul><ul><li>Median age less than 30 </li></ul><ul><li>GDP growth of 9% annually </li></ul><ul><li>Why the iPod? </li></ul><ul><li>High global demand </li></ul><ul><li>Successful in Mexico </li></ul><ul><li>International revenue grew 17% in 2007 </li></ul><ul><li>Unique </li></ul>
  3. 3. Obstacles and Opportunities <ul><li>High Tariffs </li></ul><ul><ul><li>10-20% tariff </li></ul></ul><ul><ul><li>37-47% tax and tariff </li></ul></ul><ul><li>Product Adaptations </li></ul><ul><ul><li>Language, 220 volt </li></ul></ul><ul><li>Double Taxation </li></ul><ul><ul><li>No tax treaty </li></ul></ul><ul><li>Few Non-Tariff Barriers </li></ul><ul><ul><li>No quotas or licenses </li></ul></ul><ul><li>Financing </li></ul><ul><ul><li>2 nd largest trading partner </li></ul></ul><ul><li>Significant Growth Potential </li></ul><ul><ul><li>1/3 live in or around Buenos Aires </li></ul></ul>
  4. 4. Alternative Methods *Subsidiary* Foreign Distributor Contracting Agent Pros <ul><li>Guaranteed control </li></ul><ul><li>Confidential information is protected </li></ul><ul><li>Required by law </li></ul><ul><li>Responsible for collecting payment </li></ul><ul><li>Provide after purchase support </li></ul><ul><li>Some home country management </li></ul><ul><li>Know the market </li></ul><ul><li>Complete control </li></ul><ul><li>Know the market </li></ul><ul><li>Easy to revoke </li></ul>Cons <ul><li>Governed by local laws </li></ul><ul><li>Open to double taxation </li></ul><ul><li>Unable to test the market </li></ul><ul><li>Lack of control </li></ul><ul><li>Often own competitors products </li></ul><ul><li>Care about the sale, not the product </li></ul><ul><li>Lack of control </li></ul><ul><li>Disclosure of confidential information </li></ul><ul><li>Agent assumes no risk </li></ul><ul><li>Not responsible for arranging payment </li></ul><ul><li>Only care about the sale </li></ul>
  5. 5. Key Elements
  6. 6. Legal Aspects <ul><li>Treated like citizens </li></ul><ul><ul><li>Access to financing </li></ul></ul><ul><ul><li>Welcome to take profits </li></ul></ul><ul><li>Must have subsidiary or branch </li></ul>
  7. 7. Financing <ul><li>U.S. Loans </li></ul><ul><li>Small Business Administration </li></ul><ul><ul><li>Short term loans </li></ul></ul><ul><li>International Finance Corporation </li></ul><ul><ul><li>Developing countries </li></ul></ul><ul><li>Export-Import Bank </li></ul><ul><ul><li>Guarantees loans </li></ul></ul><ul><li>Citibank </li></ul><ul><ul><li>Only U.S. bank in Argentina retail </li></ul></ul><ul><li>Argentina Loans </li></ul><ul><li>Late 1990’s: 120 Banks </li></ul><ul><li>Today: 67 Banks </li></ul><ul><li>Advanced payment of imports </li></ul>
  8. 8. Questions?

×