4.2.1

Question 1

What is a Push Factor

Answer 1

Factors that push a business to expand outside of the domestic country

Question 2

2 Push Factors

Answer 2

-Saturated Markets
-Intense Competition

Question 3

What is a Pull Factor

Answer 3

Factors that encourage businesses to expand to markets abroad

Question 4

2 Pull Factors

Answer 4

-Economies of Scale
-Risk Spreading

Question 5

Definition of Offshoring

Answer 5

When a company moves part of the company to another country

Question 6

3 Advantages of Offshoring

Answer 6

-Lower labour costs
-Access to specialised suppliers
-Economies of Scale

Question 7

3 Disadvantages of Offshoring

Answer 7

-Increased short term costs
-Poor customer service to language or cultural differences
-Employee/Employer relations may suffer

Question 8

Definition of Outsourcing

Answer 8

When an external organisation completes certain business function

Question 9

3 Advantages of Outsourcing

Answer 9

-Access to specialist skills
-Cost effectiveness
-Higher labour productivity

Question 10

2 Disadvantages of Outsourcing

Answer 10

-Damage to brand image
-Poor Communication

Question 11

How can the PLC be applied to trade

Answer 11

An extension strategy may be to sell the product in a new international market