Lesson 4.1: Logistics in International Business

  • Lesson 4.1: Logistics in International Business

    Learning Goals: By the end of this lesson you will be able to 

    1. Compare the logistics of delivering a product to a local, a national, and an international market.
    2. Describe the key factors that influence the ways in which a company may deliver its product to an international market.
    3. Compare the advantages and disadvantages of different modes of transportation for distributing a product to different world markets.


    • Lesson 4.1 Warmer Forum

      Do you know any companies that have really good logistics? 

    • Independent Work

      1.Textbook Sections 9.1, 9.2, 9.3
      2.Glossary Quiz
      3.Exit Card
      4.Homework Forum

    • lesson 3.5 textbook work.jpg
    • Lesson 4.1 Glossary Quiz

      Do this quiz before class and after you study the glossary.

    • Horizontal vs Vertical Integration.jpg
    • Lesson 4.1Production Forum

      The CEO of Yi Dian Dian is trying to decide between horizontal integration and vertical integration. Prepare a presentation and answer these questions:

      1. Who can Yi Dian Dian do horizontal integration with? What would be the benefits and challenges?
      2. Who can Yi Dian Dian do vertical integration with? What would be the benefits and challenges?
      3. What do you recommend Yi Dian Dian to do?


    • Vertical Integration Examples

      1. Apple Inc.

        • Type: Backward Integration
        • Description: Apple is known for its high degree of vertical integration, notably in hardware manufacturing. By designing its own chips, such as the A-series processors used in iPhones and iPads, Apple controls critical components of its supply chain. This integration allows Apple to optimize performance and better control the production timeline, quality, and costs.

      2. Netflix

        • Type: Forward Integration
        • Description: Netflix originally delivered DVDs by mail but transitioned into streaming services, eventually moving into content creation and distribution. By producing its own content, Netflix vertically integrated forward from its original service model. This shift allowed Netflix to offer exclusive content, reducing reliance on third-party content providers and enhancing subscriber attraction and retention.

      Horizontal Integration Examples

      1. The Walt Disney Company

        • Description: Disney's acquisition of Pixar, Marvel, Lucasfilm, and 21st Century Fox represents significant horizontal integration. These acquisitions expanded Disney's portfolio of intellectual property, substantially increasing its market share in the entertainment industry. This strategy has allowed Disney to leverage synergies across its various entertainment and media platforms, enhancing its competitive position and market reach.

      2. Facebook (Meta Platforms, Inc.)

        • Description: Facebook's acquisitions of Instagram and WhatsApp are prime examples of horizontal integration. By acquiring these companies, Facebook expanded its social media and messaging services footprint, consolidating its position in the digital communication and social networking sectors. This strategy helped Facebook to capture a larger user base and diversify its service offerings, keeping competition at bay.

      Mixed Integration Example

      1. Amazon
        • Type: Both Vertical and Horizontal Integration
        • Description: Amazon demonstrates both vertical and horizontal integration strategies. Vertically, Amazon has integrated forward by establishing its own distribution and delivery network, including cargo planes and delivery vans. This integration helps Amazon control its logistics and reduce reliance on third-party carriers. Horizontally, Amazon has expanded through acquisitions like Whole Foods Market, integrating across different business sectors to broaden its retail and distribution footprint. Additionally, Amazon's development of services like Amazon Web Services (AWS) showcases further vertical integration into cloud computing, providing infrastructure and platform services.




    • Lesson 4.1Homework Forum

      Put your notes from the reading here by 1 hour before class.