Global markets and business expansion Flashcards

1
Q

What are the push and pull factors which prompt trade?

A
Push: 
- saturated markets
- competition 
Pull: 
- economies of scale
- risk spreading
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2
Q

What are push and pull factors?

A

Push factors are factors existing in markets that encourages an organisation to seek international opportunities.
Push factors are factors existing in markets that encourage an organisation to seek international opportunities

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3
Q

What is off shoring?

A

To shift jobs to other countries

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4
Q

What is outsourcing?

A

To shift jobs to other organisations

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5
Q

How might a business extend the product life cycle in multiple markets?

A
  1. move production to new markets to reduce costs = increases margins
  2. sell in new markets = introductory stage = extends cycle
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6
Q

What factors should a business consider when assessing a country as a market?

A
  • Level and growth of disposable income
  • ease of doing business
  • infrastructure
  • political stability
  • exchange rates
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7
Q

What factors should a business consider when assessing a country as a production location?

A
  • cost of production
  • skills and availability of labour force
  • infrastructure
  • location in trading bloc
  • government incentives
  • ease of doing business
  • political stability
  • natural resources
  • likely return on investment
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8
Q

Why might a business choose to merge or joint venture globally?

A
  • spread risk over different countries / regions
  • enter new markets / trading blocs
  • acquire national / international brand names
  • securing resources / supplies
  • maintain global competitiveness
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9
Q

What is competitive advantage?

A

The advantage a company has over another in the provision of a particular product or service

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10
Q

What is skill shortages?

A

Where potential employees don’t have the skills demanded by employers

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