GMS 520 Lecture Notes - Lecture 3: Next Eleven, Market Saturation, Organizational Culture
Document Summary
International factors that a company might not need to consider when operating at home: pest (political, economic, sociocultural, Technological) control threats- effective = higher success in foreign countries. Success depends on how well you take advantage of opportunities and. Econ: current and potential capacity to produce and distribute output. Factors: stage of economic development, population, employment, income, productivity, urbanization, inflation, interest rates. Higher inflation = higher interest rate = higher cost of borrowing, lower value of revenue in currency = exchange risk, especially if you make goods in a country with high inflation and sell in another with low inflation. Most industrial = steady population, market saturation. Developing = rising population, long run potential for growth, need to satisfy basics e. g. food and clothing and education. More developed = more sophisticated business efforts. In international business, focus shifts when pace of economic development starts to develop, grow. Bric will constitute 20% of world growth in 2025.