Unit 14

Question 1

Q1. What is a marketing strategy?

Answer 1

A1. A plan to achieve the marketing objective using a given level of resources.

Question 2

Q2. What are legal controls?

Answer 2

A2. Laws that control the activities of business.

Question 3

Q3. What are barriers to trade?

Answer 3

A3. Usually taxes, quotas, or bans that one country places on goods of another country.

Question 4

Q4. What is the domestic market?

Answer 4

A4. The market for goods and services in the business’s own country.

Question 5

Q5. What is a joint venture?

Answer 5

A5. An agreement between two or more businesses to work together on a project.

Question 6

Q.6 What is the Importance of marketing strategy?

Answer 6

A.6 Decisions about product, price, place and promotion taken to achieve a business’s objectives with the correct budget and plans with the objectives in mind.

Question 7

Q.7 What are the Duties of legal controls?

Answer 7

A.7
1) Protect consumers from faulty and dangerous goods.
2) Prevent businesses from using advertising to mislead consumers.
3) Protect consumers from being exploited in industries where there less competition.

Question 8

Q.8 What are the impacts of legal controls?

Answer 8

A.8
1) Costs may be increased.
2) Business may need to change products to meet quality and safety standards.
3) Advertisements may have to be withdrawn.
4) Business may have to issue an apology in newspapers.

Question 9

Q.9 What are the effects of legal controls on advertisements?

Answer 9

A.9 If old advertisements do not meet the criteria for new legal controls, advertisements may need to be discarded and funded again.

Question 10

Q.10 Explain the importance of opportunities to enter new foreign markets.

Answer 10

A.10 Market in own country may already be established or may be in decline, thus marketing in other countries may be beneficial for increased sales and profit.
Increase in international marketing has been possible because of developments in technology which have reduced barriers to trade between foreign countries.

Question 11

Q.11 Explain the barriers to entering foreign markets.

Answer 11

A.11
1) Difference in language and culture.
2) Economic difference.
3) Social differences.
4) Differences in legal controls.
5) Lack of market knowledge.

Question 12

Q.12 Explain the problem with entering foreign markets: Difference in language and culture.

Answer 12

A.12 Language barriers can be solved easily, however, it is difficult to know the difference in culture. Language and cultural barriers may cause problems within the work force and may hinder communication, affecting productivity.

Question 13

Q.13 Explain the problem with entering foreign markets: Economic diference.

Answer 13

A.13 People from different countries have different income rates. This means prices may have to be changed.

Question 14

Q.14 Explain the problem with entering foreign markets: Social difference.

Answer 14

A.14 Age structure, importance of family and the role of family members have an impact on business activity.

Question 15

Q.15 Explain the problem with entering foreign markets: Differences in legal control.

Answer 15

A.15 Countries have their own laws and regulations to protect consumers from unfair or dangerous activity which may be different from business’s own country.

Question 16

Q.16 Mention the reasons behind a lack of market knowledge in foreign markets.

Answer 16

A.16
1) The market may not know the business.
2) The business may not know the market.

Question 17

Q.17 Explain why lack of market knowledge happens due to the market not knowing the business.

Answer 17

A.17 Customers and consumers may not be familiar with the business’s name, services and products.

Question 18

Q.18 Explain why lack of market knowledge happens due to the business not knowing the market.

Answer 18

A.18 The business needs to know things about the market, such as: market size, brand image, competitors, customer loyalty to existing products, customer taste and preferences, channel of distribution, sources of media.

Question 19

Q.19 What are the methods to overcome problems in the foreign market?

Answer 19

A.19
1) Franchising.
2) Licensing.
3) Joint ventures.

Question 20

Q.20 Explain how this method helps the business in foreign markets: Franchising.

Answer 20

A.20 Partnering with another business that is already successful in the area will allow a business to get more sales with the help of the other business.

Question 21

Q.21 Explain how this method helps the business in foreign markets: Licensing.

Answer 21

A.21
A business in one country allows a firm in another country to its branded product under license.
This allows the products to be made in a country where the business understands the locals, however, problems may arise if the business’s quality standards are not met.

Question 22

Q.22 Why would a business want to do a joint venture to help make profit in a foreign market?

Answer 22

A.22
1) Reduces risks and costs.
2) Each business brings different expertise.
3) Market potential for all businesses in the joint venture is increased.

Question 23

Q.23 What are the limitations for a business to do a joint venture in a foreign market?

Answer 23

A.23
1) Mistakes made by one company will reflect on both.
2) Decision making process may be difficult due to different business culture or style of leadership.