4.2.2 Assessment Of A Country As A Market Flashcards
What are the 5 factors that make a country more attractive to sell in?
1.) Levels and growth of disposable income
2.) Ease of doing business
3.) Infrastructure
4.) Political stability
5.) Exchange rate
What is a disposable income?
The amount that a customer has to spend after all their bills have been paid.
Why would a business look at levels of disposable income in a country?
This helps to a business to see if the citizens of the country will be able to afford the products they want to sell there.
What is a disposable income per household?
Household disposable income is the amount of money that a household earns, or gains, each year after taxes.
What does a growth of disposable income mean to businesses?
Can signal potential opportunities in that country to sell to.
What is the ease of doing business?
Better, usually simpler, regulations for businesses and stronger protections of property rights.
What is infrastructure?
The basic physical and organisational structures and facilities (e.g. buildings, roads, power supplies) needed for the operation of a society or business.
What are the 2 reasons infrastructure is important to sales?
1.) Without road, rail and transport a business cannot deliver to it’s customers in time.
2.) Without telecommunications a business can not communicate with it’s suppliers and customers.
Why may political instability negatively affect a business?
Each new government may seek to impose a series of laws which will need to be adhered to, e.g. environment laws, employment laws which could have an impact on the business.
Why is political stability so important?
An aggressive takeover of a government could lead to negative effects such as:
-riots
-protests
-looting
-civil wars
What are the 6 factors of exchange rates?
-Strong
-Pound
-Imports
-Cheaper
-Exports
-Dearer
