4.2.2 ASSESSMENT OF A COUNTRY AS A MARKET

Question 1

What are the 5 WAYS to ASSESS a COUNTRY as a MARKET?

Answer 1

(1) DISPOSABLE INCOME
(2) EASE OF DOING BUSINESS
(3) INFRASTRUCTURE
(4) POLITICAL STABILITY
(5) EXCHANGE RATES

Question 2

Explain the WAY of Assessing a Country as a Market - DISPOSABLE INCOME

Answer 2

if a BUSINESS wants to MOVE to ANOTHER COUNTRY -> Assess the LEVEL of DISPOSABLE INCOME -> HELPS Business SEE IF the CITIZENS of the Country can AFFORD THEIR Products

Question 3

Explain the WAY of Assessing a Country as a Market - EASE OF DOING BUSINESS

Answer 3

Problems with GOOD ENTERING a COUNTRY, SETTING UP PREMISES, PROTECTIONISM (e.g. Tariffs ) or everyday dealing or trading -> CAUSES DELAYS in SALES and INCREASE COSTS

Question 4

Explain the WAY of Assessing a Country as a Market - INFRASTRUCTURE

Answer 4

the Basic PHYSICAL and ORGANISATIONAL STRUCTURES and FACILITIES needed FOR OPERATION e.g. BUILDINGS, ROADS, POWER SUPPLIES, TELECOMMUNICATIONS
- important to SALES, DELIVERY TIME

Question 5

Explain the WAY of Assessing a Country as a Market - POLITICAL STABILITY

Answer 5

• Political INSTABILITY -> Major RISK FACTOR -> can AFFECT a Country’s BUSINESS ENVIRONMENT and COST INVESTORS
• AGGRESSIVE TAKEOVER of GOV –> RIOTS, PROTESTS
• MEMBERS of GLOBAL ORGANISATIONS, e.g. UN -> have to Agree to Certain Rules = MORE STABLE COUNTRY

Question 6

Explain the WAY of Assessing a Country as a Market - EXCHANGE RATES

Answer 6

STRONG POUND means IMPORTS are CHEAPER and EXPORTS are HIGHER PRICED

Countries with STABLE EXCHANGE RATES > FLUCTUATING EXCHANGE RATES