key terms 4.2- Global markets and business expansion Flashcards
what are economies of scale?
increasing the scale of production leads to a lower cost per unit of output
what is labour productivity?
the amount of goods and service produced by lone hour in labour
what is off-shoring?
shifting jobs to other countries
what is outsourcing?
shifting jobs to other organisations
what is the product life cycle?
the stages that many products go through
1-development 2-introduction 3-growth 4-maturity 5-decline
what are pull factors?
factors that entice firms into new markets and are the opportunities that businesses can take advantages of when selling into overseas markets
what are push factors?
factors in the existing market that encourage an organisation to seek international opportunities
what is risk?
the probability of a bad event happening multiplied by its negative impact
what is saturation?
the point when most of the customers who want to buy a product already have it or there is the limited remaining opportunity for growth in sales
what is disposable income?
the amount of money that a person has left over after they have paid their taxes, national insurance and other deductions
what is an exchange rate?
the price of one currency against another `
what is infrastructure?
the basic systems, facilities, services and capital equipment required for a country’s economy to function
what is reshoring?
bringing production back home after using foreign production facilities for a period of time
what is a trade bloc?
a group of countries situated in the same region that join together and enjoy trade free of tariffs and other trade barriers
what is franchising?
establishing a long-term cooperative relationship whereby one party (franchisor) contracts with another (franchisee) to run its business
what is intellectual property?
a product that is a creation of the mind that the law protects from unauthorised use by others
what is licensing?
a contract with another firm to use its intellectual property or to produce its product or service in return for a fee
what are barriers to entry?
factors that make it difficult for a company to enter an industry or type of business and compete effectively
what is competitive advantage?
the advantage one company has over another or several others in the provision of a particular product or service
what is cost competitiveness?
through acquiring economies of scale, a company creates the cheapest product on the market
what is cost leadership?
a way to establish a competitive advantage and essentially means the lowest cost of operation in the industry
what is differentiation?
when a firm selects certain attributes of its products or services and tries to match these with specific customers
what is economic risk?
risk that future cash flows will change due to unexpected exchange rate changes
what is global competitiveness?
the extent to which a business or a country can compete successfully against rivals
what are skills shortages?
were potential employees do not have the skills demanded by employers
