First exam Flashcards
Intangibility
Products that cannot be seen, tasted, felt, heard, or smelled before they are purchased. We do not know the quality of the product until after we have experienced it.
Inseparability
Inseparability means both the employee and the customer are often part of the product.
Variability
Services are highly variable: services are produced and consumed simultaneously, which limits quality control.
Perishability
Services cannot be stored
Three pillars of sustainability
Economical, Social and Environmental
5 P of sustainability
- People
- Planet
- Profit
- Peace
- Partnership
Stakeholder
A stakeholder is any group or individual who can affect or is affected by the achievement of the organization’s objectives
Macro environment
Macroenvironment consists of the larger societal forces that affect the microenvironment (demographic, economic, natural, technological, political, and cultural forces).
Microenvironment
Microenvironment consists of the actors close to the company that affect its ability to serve its customers (the company, suppliers, marketing intermediaries, customer markets, competitors, and publics).
Country risk
Exposure to potential loss or adverse effects on company operations and profitability caused by developments in a country’s political and/or legal environments.
Dimensions of country’s risk
- currency
- commercial
- cross-cultural
- political risk
Individualism vs Collectivism (political system)
Individualism → an individual should have freedom in his own economic and political pursuits. It implies a democratic political system and free-market economies
Collectivism → primacy of collective goals over individual goals.
Democracy vs totalitarianism
Democracy → political system in which government is by the people, exercised either directly or through elected representatives. Most modern democratic states practice representative democracy where citizens periodically elect individuals to represent them.
Totalitarianism → is a form of government in which one person or political party exercises absolute control over all spheres of human life and prohibits opposing political parties
Country risk produced by political systems
- Government takeover of corporate assets
- Embargoes and sanctions
- Boycott against firms and nations
Government takeover of corporate assets
Confiscation → seizure of corporate assets without compensation
Expropriation → asset seizure with compensation
Nationalization → takeover of an entire industry, with or without compensation
Embargoes and sanctions
Embargoes → completely stopping, they are bans on exports or imports that forbid trade in specific goods with specific countries.
Sanctions → are bans on international trade, usually undertaken by a country, or a group of countries, against another judged to have jeopardized peace and security.
Boycotts
Voluntary refusal to engage in commercial dealings with a nation or a company.
Market economy
All productive activities are privately owned and production is determined by the interaction of supply and demand. The government encourages free and fair competition between private producers
Command economy
Government plans the goods and services that a country produces, the quantity that is produced, and the prices at which they are sold. All businesses are state-owned, and governments allocate resources for “the good of society”.
Mixed economy
Certain sectors of the economy are left to private ownership and free market mechanisms while other sectors have significant state ownership and government planning. Governments tend to own firms that are considered important to national security.
Common law
It’s based on legal precedents, tradition, and past practices, set by courts via interpretation of statutes, legislation, and past rulings. Common law is relatively flexible.
Civil law
Based on an all-inclusive system of laws that have been clearly written by legislative bodies. Laws are not strongly subject to interpretation by courts. Civil law is mainly legislative and based on laws passed by national and state legislatures.
Trademark
Trademarks protect words, names, symbols, sounds, or colors that distinguish goods™ and services. It protects everything that makes your brand recognizable
Patent
Form of protection that provides a person or legal entity with exclusive rights for making, using, or selling a concept or invention and excludes others from doing the same for its duration.
Its utility is 20 years.