Integrativetrade is a situation whereby, firms are opting to supply or offerparticular enormous amounts of goods and services to larger networkof firms. Vertical fragmentation is the strong drive behind thisdecision by the companies. The whole idea of collections andpackaging is leading to the reduction of barriers to global sourcingeven further resulting in an increased supply based competition andoutsourcing, as well as, off shoring in which an end cannot bereached. The whole idea of economic integration will see that thepattern of globalization, which has already developed, will worktowards altering the future patterns. For example, during theintroduction of computer hardware, most firms had few capabilities.Communication was expensive, unreliable, and had limitedfunctionality. By contrast, the presence of infrastructures, anestablishment of business models and strong skills, are leading toservice off shoring.
Bundlingentails offering different products for sale as a single combinedproduct. A company may consider mixed bundling in order to offerconsumers an opportunity to purchase one of the products or all theproducts that the company offers this increases the revenues of thecompany. For instance, a company dealing with telecommunicationsmight be offering cell phones and internet services. However, inexisting and emerging markets, a major problem is the lack ofreliable power that can assist in expanding computer services as wellas internet related services. Nevertheless, a combination of bundles,which includes the power supply, internet access, and digitalcontent, can be bundled and sold as a single package. Institutionslike schools and hospitals can benefit a lot from such bundles not tomention even ordinary individuals.
TheCultural dimension of the international market creates an enormousdifference between two parties involved since they can view thenegotiation differently. Some cultures may consider a businessnegotiation as a contract that should be signed between the two sideswhile others may see it as the relationship created out of acompany’s event. Again, different cultures have different attitudesand approach business arbitration in either a win-win or a win-losenegotiation. Different cultures pose different ways of presentingtheir talk they can be formal or informal. Example, an officialnegotiator, may prefer using titles while addressing theircounterparts while an experienced businessperson addresses theircounterpart by their first names. Also, it becomes difficult fordifferent individuals to communicate in case of different language,but with the help of the internet and new technology, it has becomeeasy to open new marketplaces to promote businesses in new geographicareas and diverse cultures.
Inthe outline of the possible ethical issues to be presented to the CEOof a given company includes the importance of employing andsurrounding the business with smarter people who will bring in newideas necessary for the current competition. The hiring processshould include a fair and just practice of giving out salaries andpromotions, and opportunity should be given to all races and cultureswithout any discrimination. Second, with the world becoming a globalmarket, employing people with diverse cultures will promote theperformance of the business. Third, reward systems and employeemotivation is another major area that require an application ofethics.
Thereare typical cultural differences to be considered in the case ofcontact meeting with people from different cultures. First, islanguage barrier. In some countries, people talk in loud voices andare assertive when sharing ideas or giving directions, others aresoft spoken, and they are more passive when it comes to giving outsuggestions. Second, the difference to be aware of is the targetaudience for example, when introducing something to a broad market,it is prudent to consider people`s ideologies, gender values, andconservatism. Knowledge on the different cultures of people willalways help the company to narrow down the target groups. Otherdifferences include technology and politics.
Thereare two standard techniques used in the market. One, Primary marketresearch, information is gathered directly from the field forinstance, interview and observation. It is the most valuable methodand it only answers specific questions but not any irrelevancies. Insecondary research, information is not gathered from the scratch butrather from other available sources. This research relies oninformation gathered by other people, and its aim is to use the manydifferent available resources such as books, videos, and journalsamong others. Less time is used to carry out secondary research, soit is sometimes considered beneficial.
Agentsrepresent suppliers in international businesses. Some advantages areattached to the presence of agents, exporter has the freedom toprice, brand and market his or her goods, and commission-basedsalaries lead to the selling of large volumes of goods, agents aremore focused on the products rather than the distributors since theyhave the small range of goods. Officers and their employers shouldhave written agreements before they enter into a working relationshipthus matters of paying less than what is agreed should not arise.Again, agents should be competitive, efficient, and smart at theirjobs to avoid payment delays, lack of customers and poor customerrelations
Severalfactors have to be incorporated to improve a company with too highfreight costs or have nothing at all. First, it is important to notethat high freight cost can turn a profitable business into totallosses. Thus, there is dire need to reduce the expedited service tomeet the requirements of customers. A good internal scrutiny isnecessary to rule out any problem that may be causing the high cost,whether it is poor planning, and then the reasons for the problemshould be established. Again, logistics and sales must work togetherto ensure cooperation. Maybe an agreement with the customer toprovide his or her order earlier can be a better solution to reducecosts. Keeping good data and reducing fulfilling time are otherfactors that can improve freight costs.
Regulatory,economic, and political risks are among the many hazards thatcompanies may encounter when exporting and importing goods thisincludes political instabilities in different countries,unpredictable change of government laws and regulations, enactinglaws that only favor the local businesses and potentially adverse taxconsequences. However understanding the cultural differences,acquiring knowledge on security environment, identifying health risksand medical environment, respecting the foreign corrupt practices actcan help companies to deal with risks involved.
Aninternational business plan is a crucial tool that each companyshould have. It benefits a company in several ways for example,objectives and goals of the company are included in the plan. It alsocommunicates to others the scope, range, and nature of the program.Again, the method allocates the responsibilities and evaluation ofthe results. Furthermore, it gives a roadmap for the management toput into practice what is required of them and to establish aconsensus, accord, and support needed to ensure commitment toexporting.
Lawsand regulations that govern a given nation are there to protect anindividual or an organization. They also provide the promotionsupport and maintenance of certain categories of national interest.Nevertheless, these laws and regulations are meant to operate on theinternational ground with maximum effectiveness in the perspective oflegislation and institutions, and broader international agreements.All the same, it may appear unrealistic to find a common ground tothe international community concerning the large numbers ofregulatory regimes, legal tradition, and endless variety of publicpolicy objectives. WTO relates to domestic laws governing the conductof international trade through ensuring that it uses laws that areused in the domestic market.