311 globalisatiion Flashcards
1
Q
what is meant by globalisation
A
- the process where the world is becoming more interconnected as a result of significantly increased trade and cultural exchange
- globalisation has increased the production of goods and services
2
Q
factors that have contributed to globalisation
A
- improved communication and technologies
- liberisation of trade - removes barriers to trade/ cross boarders de regulisation- creation of international trading
- cost of transportation- increased use of containerisation- transportation costs decrease- cheaper for busisnes tot move goods and for customers to buy them
- consumer tastes- individuals see what people in other counties have and want them
3
Q
effect of globalisation
A
- increased trade- barriers removed- more competition for domestic businesses- harder to survive
-> (+) consumer- more choice / (-) lower demand impacting suppliers and shareholders - opportunities for growth- domestic business will be able to find new markets abroad- help grow- economies of scale
- > depends on type of business and its ability to take advantage of these opportunities
4
Q
benefits of globalisation workforce
A
- more diverse ideas + innovation
- cheaper to hire
5
Q
link between containerisation and added value
A
- containers allows for greater and more efficient international trading, sos they can guarantee next day delivery- more desirable for consumers
6
Q
drawbacks of globalisation to a business
A
- cultural barriers - need to do MR
- supply chain issues
- currency issues
- more competition- already established business- local business outcompete by large business- drive out local shops
- local taxes & laws
7
Q
what are developing markets
A
- (or emerging economy) refers to country with growing economy and growing consumption population
8
Q
opportunities of developing markets
A
- fast growing GDP- increasing incomes-more potential sales and profits
- potential for first mover advantage
- available labour and raw materials - affordable
- less strict labour costs/laws
- weak exchange rate
9
Q
what is glocalisation
A
- is about thinking globally but acting locally
- this approach is one that considers local tastes, customs and traditions when adapting their marketing mix
- this approach is more likely to utilise their capabilities on local stakeholders and work in their benefits better
10
Q
what is a globalised/standardised approach
A
- where a business maintains the same marketing mix in each country
11
Q
(+) of globalised/standardised approach
A
- economies of scale
- brand loyalty- meeting the same expectation across the globe
- easier for customers to buy- recognisable- strong brand image
12
Q
(-) of globalised/standardised approach
A
- longer supply chain s
- may not meet cultural expectations in each country
- expensive and difficult quality management
- may not meet legislation expectations in each country
13
Q
what is a multi national company
A
- busisnes operating in numerous counties, weather extracting resources, manufacturing or retailing
14
Q
reasons for multinational companies
A
- increased sales and market share
- chaser production costs
- spreads risk ie. if one market is in a downturn, another may be in a boom
- economies of scale
- potential government grants and other funding that may be given to encourage business to set up production in another country
15
Q
(+) of multinational companies
A
- create wealth and jobs around the world
- size and scale of operation - economises of scale- lower average cost and price for customers
- large profits can be used for R+D
- outsourcing of production by multinationals - lower prices - increases disposable income- buy more goods and services- employment etc
16
Q
(-) of multinational companies
A
- multinational companies usually have monopoly power- enables the to make excess profit
- tax avoidance
- their market dominance makes it harder for small business to thrive
- outsourcing to cheaper labour cost- economies has causes loss of jobs in developed world
