Business and globalisation (paper2) Flashcards
What is GLOBALISATION?
where businesses operate internationally and gain a lot of influence or power.
What are IMPORTS?
the flow of goods and services into one country from another country
What are EXPORTS?
the flow of goods and services out of one country to another
What is LOCATION? (in terms of globalistation)
opportunities for businesses to relocate to other countries, this may benefit from lower labour costs, to be closer to raw materials or to be closer to the markets to which they sell their products
What are MULTINATIONALS?
a large company with facilities and markets around the world creating loads of jobs and growth when they enter a country
What are MULTINATIONALS?
A large company with facilities and markets around the world. They are powerful businesses that can create lots of jobs and growth when they enter a country
Benefits of globalisation for businesses
+new market opportunities
+access to technology and resources
Drawbacks of globalisation for businesses
- threat from foreign competitors
- challenge of adapting products and services to meet the needs of foreign consumers
Trade barriers for international trade
> TARIFS
NON TARIFF BARRIERS-imposing quality or safety standards
TRADE BLOCS
QUOTAS- physical limits on imports
SUBSIDIES- money given to help domestic producers
Impacts of countries having TRADE BLOCS
> benefit the countries from sharing workers, knowledge and expertise. Countries may specialise in certain goods/ services meaning they can offer lower prices and efficiency
benefit from lower wages and tax rates
creates trade barriers from other countries
other countries may increase their barriers
What is international trade?
is the buying or selling of goods and services between countries, however there can be many barriers to prevent countries in engaging in trade deals
What is FREE TRADE?
there are no barriers to international trade
What is PROTECTIONISM?
when countries take action that restrict the flow of imports into their country
Types of TARIFFS
> tax charged on imports
QUOTAS provides a physical limit put on that import
NON TARIFF BARRIERS imposing difficult quality or safety standards on imported goods
What are TRADE BLOCS?
Promoting trade between a small group of countries but impose protectionist policies on outside countries to encourage trade between these countries
Impacts of countries having TARIFFS
> makes product more expensive, encouraging demand to domestically produced goods rather than overseas imports
protects countries businesses
protects countries employees
reduces competition from abroad
customers will have to pay higher prices
What is GLOCALISATION?
in order to sell to international markets, businesses often have to change their products in order to adapt to other countries cultural differences, tastes and legal requirements
How businesses change their marketing mix to compete internationally?
PRODUCT
> change technological components (eg sockets)
change taste to meet cultural preferences
change components to meet safety regulations
How businesses change their marketing mix to compete internationally?
PRICE
> change price to consider tariffs
comply with different tax laws
account for currency conversions
account for incomes in foreign countries
How businesses change their marketing mix to compete internationally?
PLACE
> change location of products in line with local preferences
what time people shop at and which shops people visit
How businesses change their marketing mix to compete internationally?
PROMOTION
> revise advertising campaigns to take into account the fact that the meanings of colours, gestures and phrases are different in different countries
