Textbook Notes (363,566)
Canada (158,433)
York University (12,360)
ADMS 2200 (123)
Kim Snow (26)
Chapter 6

Chapter 6 Notes ADMS 2200.docx

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York University
Administrative Studies
ADMS 2200
Kim Snow

Chapter 6: Serving Global Markets Exporting – marketing domestically produced goods and services abroad Importing – purchasing foreign goods and services Chapter Objective 1: Describe the importance of global marketing from the perspectives of the individual firm and the nation. Benefits of going global: - Additional revenue - New insights into customer behaviour - Alternative distribution strategies - Advance notice of new products - Exposure to new marketing techniques A major key to achieving success in foreign markets is a firm’s ability to adapt its products to local preferences and culture. Chapter Objective 2: Identify the major components of the environment for global marketing. International Economic Environment - National Factors o Nation’s size, per-capita income, stage of economic development determine its prospects - Infrastructure o Underlying foundation for modern life and efficient marketing o Transportation, communications, banking, utilities, and public services - Exchange Rate o Price of one nation’s currency in terms of another country’s currency o Fluctuations can make a nation’s currency more/less valuable compared to other nations International Social-Cultural Environment - Before entering a market, need to study all aspects of a nation’s culture o Language, education, religious attitudes, social values - Language plays an important role in international marketing International Technological Environment - Internet technologies connect large and small firms to world markets - Technology presents some challenges for global marketers International Political-Legal Environment Laws Political Risk Assessment (PRA) – units within a firm that evaluate the political risks of the marketplaces in which they operate as well as proposed new marketplaces The legal environment for firms operating abroad results from three forces: 1. International Law a. Treaties, conventions, agreements that exist among nations b. ISO – International Organization for Standardization 2. Canadian Law a. Trade regulations, tax laws, import/export requirements 3. Legal requirements of host nations a. Affect foreign markets Trade Barriers - Tariffs o Tax against imported goods o Revenue tariff: taxes to raise funds for the importing government o Protective tariff: taxes designed to raise retail price of an imported product to match or exceed domestic product (usually higher than revenue tariff) - Other trade barriers o Import quotas: limit the number of units of certain goods that enter a country for resale o Embargo: complete ban on the import of a product o Subsidy: government financial support of a private industry o Exchange control: regulate international trade among importing organizations by controlling access to foreign currencies - Dumping o Selling a product in a foreign market at a price lower than what it receives in domestic market Chapter Objective 3: Outline the basic functions of GATT, WTO, NAFTA, FTAA and the EU Multinational Economic Integration Free Trade Area – region in which participating nations agree to free trade of goods among themselves, abolishing tariffs and trade restrictions Customs Union – establishes free trade area + uniform tariff for trade with non- member nations Common Market – extends customers union by seeking to reconcile all government regulations affecting trade General Agreement on Tariffs and Trade (GATT)
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