1.52 Place Flashcards
What is international Trade
The exchange of products or services between international borders
What is regional trade
The exchange of products or services within a country
What are the differences between countries or continents that affect how and where products are made or used
-Cost of production- countries have cheaper labour and materials, which is ideal for mass production, eg electronics in China
-Technological Infrastructure- countries have advanced technology, such as precision engineering in Japan
-Products are designed depending on what is needed/ popular. Eg, a mobile phone in Inida may be made with longer battery life due to the lower reliable electricity compared to one in sweden
What are the international differences
-More expensive than regional- due to border which imposes additional costs such as tariffs and time costs. This is due to border delays and expenses associated with country differences, eg language and culture
-Production factors such as capital and labour, are more portable within a country than across countries.
International trade in mainly restricted to trading goods or services
What are the reginal differences
-Climate- a product made in NI has to be waterproof compared to Southern Spain
-Availablilty of materials- designers choose materials that are locally sourced to reduce costs and support the local economy
-Skilled labour- some regions are known for certain skills, such as precision engineering in NI- this will influence what products are made there
-Cultural preferences- colour and symbols may be changed to suit the local culture or religious practices
What are the difficulties to trading
-Tariff barriers are taxes on certain imports, which raise the price of goods. This makes imports less competitive, eg China reduced its tariff imports on luxury foreign foods from 10-5%
-war and other forseeable events
-certification and testing requirements
What are end caps
-shelves at the end of the store aisles, which typically show featured products, promotions and new arrivals. They are used to capture the attention of consumers, maximising their visibility which increases sales
What are point of sale displays
-They are strategically positioned near the counter, which catches the consumers attention whilst waiting. These often feature small, impulse boys such as sweets. My capitalising consumers idle time, retailers encourage additional purchases and increased sales.
What is strategic aisle placement
-High profit margin products are placed at eye level, to attract the attention-lower demand products are placed on lower/ higher level shelves
-Retailers will position complementary products close to each other, to encourage cross selling
What is category adjacency
-Retailers will position related products in close proximity to encourage cross category purchases, such as placing a pasta pasta sauce next to pasta
-This causes consumers to purchase additional items they have not considered, causing them to increase their basket size and overall sales for the company
