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Unit 3 ­ International Business

Why does a business seek international markets?
Product or market conditions that may prompt a business to trade
internationally:
As soon as people specialise in a particular activity rather than try to
meet all of their own needs, they must trade
International trade is the…

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o Sell in multiple markets
o Government schemes in place
o Source materials
o More variety of suppliers
o Outsourcing/off shoring
o Increased trade liberalisation

Selling in multiple markets spreads risks:
o Difficulties in a market become less threatening when it is one
of several markets as the supplier is…

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It encourages trade liberalisation by operating a system
of trade rules and by providing a forum for the
negotiation of trade disputes
Promotes peace
Trade rises incomes
System encourages good government
o Trade liberalisation and WTO have made it easier for b/s to
export and to compete in foreign markets…

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Both China & India have more than a billion inhabitants, roughly a fifth of
the world´s population each, and both increased their rates of economic
growth significantly
Both countries have seen rapid industrialisation -> consequence: the
benefits of growth are not shared equally; income distribution has become
more uneven.
Both…

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o Rapid income growth in China, combined with the uneven income
distribution, has created some affluent consumers with a
growing taste for luxuries
o While there affluent Indians, the size of the Indian market for
luxuries has remained relatively small.

How does a company decide which countries to target? :…

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Competition:
A business will want to know how competitive an industry
is in a potential large market
Where a market is already intensely competitive, profit
margins are likely to be squeezed - > this will make the
market less attractive unless the business is
confident that it has a competitive…

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CSR obliges businesses to consider more than just profit, to
take account of the interests of workers, suppliers,
customers and the wider community as well as stakeholders
They are generally expected to respect the environment, to
treat people fairly and to "give something back" to the local
community
Some businesses…

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o A tax on imported goods. This adds to the price of
imports, shifting the supply curve upwards
o Tariffs are a tax on imports. The higher the taxes
the more expensive imports become. High tariffs
restrict the volume of trade
o The higher price will often discourage customers,
particularly…

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Globalisation is broadly defined as the growing integration
and interdependence of nations
The increased freedom & capacity of individuals & firms to
undertake economic transactions with residents of other
countries and operate on a global scale
One measure of the impact of globalisation is the reduction of
poverty
Global strategy…

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Disadvantages:
× Differences in consumer needs, wants and usage
patterns for products
× Differences in consumer response to marketing mix
elements
× Differences in brand and product development and the
competitive environment
× Differences in the legal environment, some of which may
conflict with those of the market

Global market…

Comments

emily

Helped so much thank you!

jake

TAA

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