Three factors that influence international trade include: Imports will also decline as they will be more expensive to U. An example of this is when McDonalds went into the Indian market, they did it with partners that knew the local business practices and customs; these companies were Hardcastle Restaurants Private Ltd which had a strong influence in western India, and Connaught Plaza Restaurants Private Ltd which were popular in the northern India.
Tariffs are also imposed to protect consumers from potentially dangerous products such as tainted foods including imported meats or inferior products such as defective airbags.
This illustrates the importance of understanding age and other demographics on a potential country that you might sell your goods or services to since they are both reliable and used in making marketing decisions. American apparel products and What are the factors influencing international products have historically received more protection against foreign competition through high tariffs on related imports.
Continued protectionist policies can eventually cause industry slowdowns and domestic jobs will be lost to global suppliers. Wars can have a very large impact on your business in a foreign country. If you manufacture a product that does not hold up well when constantly subjected to periods of high heat, you might want to consider that carefully before marketing your heat sensitive product internationally to such places as Saudi Arabia.
For the company that markets itself properly on an international level, this can lead to a huge boost in revenue. This will affect the operational control of your business and has to be factored into any marketing decisions that your company makes.
In China, piracy is very common; individuals called pirates manufacture CDs and DVDs that look almost exactly like the original product produced in the United States and other countries.
Demographic change Technology Energy and other natural resources Changes in demographics which include age, gender and income in the global economy directly impact international trade. Licensing and Permits There is a chance that the only way you can do business in a foreign country is to give out an expensive permit or license of another business in that country to manufacture and sell your product for you.
Your company is probably not going to want to market laptops to senior citizens in a third world country where there is very little internet and where a large percentage of the citizens over 60 are computer illiterate.
Tariffs are most often employed to protect domestic companies and their employees from the potentially harmful effects of increased competition. Some industries, however, are more highly protected by tariffs than others.
A perfect example of this is Canada; they have large French speaking populations around Montreal and Quebec that are culturally much different than the English speaking communities found throughout the rest of the country.
It has been estimated that U. In the more prosperous countries it is taken for granted that you can buy goods internationally and pay for them with such things as credit cards, debit cards, online payment processors and cash transfer businesses, but that is clearly not the case everywhere in the world.
For example, many people believe that a trade deficit is a bad thing. Some would call it the coordination of marketing strategies by a company that are necessary to sell goods or services in a foreign marketplace. Therefore, exports will increase.
On the other hand, a weaker dollar makes importing U. Political change in one country can impact manufacturing costs and employee wages in another country. Tariffs Tariffs have long been used to balance trade between countries and to protect national companies from losing business to foreign competitors.
Sometimes countries may set tariffs to retaliate against a trading partner they believe is breaking the rules or going against its foreign policy objectives. If you have your money tied up in a foreign currency and economic events fall just right, your company could stand to lose millions.
Thus, a trade deficit is not a good thing during a recession but may help during an expansion. International trade between nations creates the global economy where prices are influenced by a variety of factors such as world events, exchange rates, politics and protectionism.
However, sometimes a country becomes concerned that their trading partners may be a threat to their domestic economy in ways that would harm a particular industry and its workers.
As you have seen from this article, in order to market your product or service internationally, there are many factors that your business and marketing team must consider before deciding which country or region you want to sell your goods or services to. A percentage of that increase in consumption will most likely reflect an increased demand for foreign goods.
Some governments offer subsidies to their domestic firms, so that those firms can produce products at a lower cost than their global competitors. An aging population would produce less which would lead to a decrease in their capacity to export their local products.
You must also be aware of places that are regularly affected by such natural disasters as typhoons and earthquakes. Regional Partnerships Sometimes companies know it will be difficult to break into a foreign market without the help of other companies that know the nuances of marketing a product to the people there well.
Balance of trade is the difference between exports and imports. Financial Transactions and Banking Considering how you will get paid for the products and services you market and sell internationally is important too. Piracy is one reason why the United States has a large balance-of-trade deficit with China.
Technology has resulted in the introduction of goods that challenge existing products, forcing countries to evaluate their output to ensure they remain competitive in the global market.
Taxes can and do impact your ability to make a profit selling goods and services in a foreign country and will shape your international marketing strategy because of that.ADVERTISEMENTS: Most influential factors affecting Foreign Trade are as follows: Because international trade can significantly affect a country’s economy, it is important to identify and monitor the factors that influence it.
The main aim of the study is to investigate external environmental factors influencing international business transactions at Barclays bank of Kenya; these factors include political, economic, social, technological, environment and legal. factors to consider for international marketing: International marketing is very different from domestic marketing.
There are a whole host of issues when marketing internationally that a business does not normally have to deal with when marketing in their own country.
International trade is the exchange of goods between countries. It’s what enables consumers all over the world to buy French wines, Columbian coffee, Korean television sets and German cars. International trade between nations creates the global economy where prices are influenced by a variety of factors such as world events, exchange rates, politics and protectionism.
FINRA Series 6 Exam Study Guide - International Economic Factors. This section discusses international factors such as currency exchange rates, balance of trade (BOT) and Balance of Payments.
In this article, we cover the topic of international marketing and explore 1) an introduction to international marketing, 2) factors to consider for international marketing and 3) a conclusion. INTRODUCTION TO INTERNATIONAL MARKETING Jet travel opened up the world to many people, and the expansion of the World Wide Web took that one step further.Download