Cheaper labour costs/ Closer to raw materials/ Nearer to potential customers ( improves customer service).
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What are pull factors?
Factors that entice firms into new markets and are the opportunities that businesses can take advantage of when selling into overseas markets.
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What are push factors?
Factors in the existing market that encourage an organisation to seek international opportunities.
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Give 2 examples of push factors?
lots of competition/ a saturated market
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Give examples of pull factors?
new or bigger markets/ lower costs e.g. labour/ economies of scale/ risk spreading
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Give 5 factors to consider when assessing a country as a market?
Levels and growth of disposable income/ Ease of doing business/ Infrastructure/ Political stability/ Exchange rate
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Give 9 factors to consider when assessing a country as a production location?
Costs of production/ Skills and availability of labour force/ Infrastructure/ Location in a trade bloc/ Government incentives/ Ease of doing business/ Political stability/ Natural resources/ Likely return on investment
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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.
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Why do businesses want to target international markets?
Reduce dependence on domestic market/ Access faster growing markets + demand/ Achieve economies of scale/ Better serve customers located overseas/ Build brand value, particularly global brands.
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Give 9 sources of global competitiveness?
Cost advantage/ Raw material prices + access/ Cheap labour/ Wage rate/ Political stability/ Better technology/ More skilled/educated workforce/ Regulation/ Process innovation
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