UNIVERSITI UTARA MALAYSIA

EXPORT MANAGEMENT
(GFML 3073)
Decision Analysis (QQP5023)
EXPORT FINANCING

PREPARED BY GROUP NO ____:

UMR ABDUL AZIZ MIDSEN (211218)
HASSAN MAHAMED ABUUKAR (216207)
CHEW JIA JIN (220400)
FOR:
ASSOC. PROF. DR MOHAMMAD BASIR SAUD
30 NOVEMBER 2014

ABSTRACT
The purpose of the group project is to study cross culture business about the significance of both
national culture and subcultures. Cultural change is one of the important key on this topic which
is the physical environment and technology influence culture on how companies and culture
affect one another. The two main frameworks use to classify cultures would be discuss on this
topic. Moreover, this group project also focuses on the components of culture which is impact on
business activities around the world.

To Persons Are Interesting On International

Business Subject

ACKNOWLEDGEMENT
First of all, we are grateful because we were given a chance to take part on this group project
assignment. This is a wonderful opportunity for us to harness our cross culture business
knowledge on international business subject.
In this acknowledgement segment, we wanted to thank to our lecturer, Assoc. Prof. Dr
Mohammad Basir Saud for allowed us to do this group project. He had given us some idea on
how to do the group project and also on writing this dissertation. He has taught and has guided us
along the way in doing this group project. He also had given some inner idea in completing this
group project. Through the guideline, we were able to complete this group project as expected.
And for the person that we forgot to mention in this segment, we would like to say a big thank
you for you all. Without the support and help that you all gave us, this group project would not
be so faster to accomplish.

TABLE OF CONTENTS

ABSTRACT
DEDICATION
ACKNOWLEDGEMENT
TABLE OF CONTENTS
LIST OF FIGURES
LIST OF TABLES
LIST OF APPENDICES
LIST OF ABBREVIATIVES

i
ii
iii
iv
viii
ix
x
xi

1.0.

INTRODUCTION

2.0.

MARKETING RESEARCH
2.1 Secondary Data for International Marketing Data

2
3

3.0.

PRODUCT IN INTERNATIONAL MARKETING

3.1 Product Characteristics
3.2 Company consideration
3.3 Product Line Management
3.4 Product Counterfeiting

5
6
8
9
10

4.0.

PRICING FOR INTERNATIONAL MARKETING

4.1 Pricing Policy
4.1.1 Pricing Objectives
4.1.2 Parallel Imports
4.1.3 Approaches to International Pricing
4.1.4 Leasing in International Markets

12
12
12
13
15
17

4.2

18
18
23
24
25
26
26

Price Escalation
4.2.1 Costs of Exporting
4.2.2 Estimating Demand
4.2.3 The Price Elasticity of Demand
4.2.4 Break-Even Analysis
4.2.5 Marginal Analysis
4.2.6 Approaches to Lessening Price Escalation

4.2.7Using Foreign Trade Zones to Lessen Price

Escalation
4.2.8 Dumping

28
29

Administered Pricing
4.3.1 Price Setting by Industry Groups

30
31

4.3.2 Government - Influenced Pricing

4.3.3 International Agreements

33
33

4.4

Counter Trades as a Pricing Tool

4.4.1 Types of Countertrade
4.4.2 Problems of Countertrading
4.4.3 Proactive Countertrade Strategy

33
34
36
37

4.5

Intra-company Pricing Strategies

38

4.3

5.0

CREATING PROMOTIONAL STRATEGIES

5.1 International Advertising
5.2 Global Advertising
5.3 Blending Product and Promotional Strategies

40
41
42
44

6.0

DESIGNING DISTRIBUTING STRATEGIES

6.1 Designing Distribution Channels
6.2 Differences between countries
6.3 Influence of product characteristics
6.4 Special Distribution Problems

50
51
52
56
57

7.0

CHOOSING A DISTRIBUTION STRATEGY

59

8.0

CONCLUSION

61

BIBLIOGRAPHY AND REFERENCES

APPENDICES

3.2 Product Design Processes

Many Malaysian manufacturing companies are currently unable to compete effectively and sell
their products in the world markets. This is despite their best efforts to respond to market needs
and changes, and enhance their competitiveness by introducing new products and conducting
innovative redesigns on their existing products. In order to become more competitive, Malaysian
companies need to pay more radical attention to both the tangible and intangible elements of
their product and service offerings. With all their best intents, and the fact that some companies
are keen to update their products, many Malaysian companies have failed to effectively
operationalise their conceptual ideas at the initial stage of the new product design process, have
had product design projects cancelled during the design and development process, or have
launched what they believed to have been attractive products only to have them fail in the
marketplace. These failures can be divided into two categories: price and non-price factors. The
failure of Malaysian manufacturing companies in this respect seems to be either due to product
costs being too high, or the quality and design of Malaysian products not equating to
international standards, and therefore not being competitive enough to penetrate overseas
markets. They appear to be, in Porters (1980, 1990 and 2004) terms, stuck-in-the-middle
neither lowest cost or perceived as differentiated.
A number of researchers have analysed design processes. This line of research is very closely
linked to the broader subject of decision-making. A useful model of decision-making was
initially developed by Mintzberg et al (1976), and then adapted by Bennett et al (1990) for use in
analysing technical design projects. The model provides a useful basis for structuring the
analysis of product design processes, and, being generic in nature, is valid for use in Malaysian
SMIs. The model consists of seven stages: decision recognition, diagnosis, search, design,
screen, evaluation/choice, and authorisation. In addition, Bennett et al (1990) suggested one
further stage, implementation (refer Figure 3.1). This implementation stage is important so
that one can incorporate the possibility of interruptions, delays, or any changes needed
after the authorisation stage in the design process.

Figure 3.1 Mintzbergs Decision-making Model (adapted by Bennett et al, 1990)

Decision
recognition

Diagnosis

Search

Evaluation/
choice

Screen

Design

Authorisation

Implementation

Utterback and Abernathy (1975) proposed a model of process and product design by
distinguishing between different types of innovations. They suggested a framework of analysis
for individual production units by distinguishing between product, process, and work
organization design (refer Figure 3.2). Abernathy (1978) went on to use this framework in his
analysis of the US automobile industry by investigating design and productivity improvement.
Meanwhile Whipp and Clark (1986) employed this model (refer Figure 3.3) as a framework in
their project investigating the Rover SDI project (between 1968 and 1976) and suggested an
additional temporal dimension, adding the periodisation of conception, translation,
commissioning, and operation to act as a second dimension to the type of innovation. This
framework was employed by Smith, Child and Rowlinson (1990) to examine innovations within
Cadburys Limited, emphasising the relationship between new product and process innovations
and work design.

Figure 3.2 The triangle of design dimensions

Product
(or service)

Process including
facilities

Work organization
at all levels
Source: Whipp and Clark, 1986 (Pg. 17)

References and Bibliography

. (1994), A guide to design for production, The Institution of Production Engineers, London.
(2003), Economic report 2003/04, Business Times (Malaysia), 13 September 2003.
. (1998), Handbook on Foreign Direct Investment by Small and Medium-sized Enterprises:
Lesson From Asia, United Nations conference on Trade and Development (UNCTAD).
(2002), SMI Development Plan (2001-2005) (SMIDP), Percetakan Nasional Malaysia
Berhad, Kuala Lumpur, Malaysia.
Abdullah, Moha Asri; et al (2002), The use of information technology in Small and Medium
Industries in Malaysia, School of Humanities, Universiti Sains Malaysia, Malaysia.
Abdul-Rahman, Hamzah; Kwan, C.L., and Woods, Peter C. (1999), Quality function
deployment in construction design: application in low-cost housing design, International
Journal of Quality & Reliability Management, Vol. 16 No. 6.
Abernathy, William J. (1978), The Productivity Dilemma: Roadblock to Innovation in the
Automobile Industry, John Hopkins University Press, Baltimore, USA.

Abernathy, W.J. and Utterback, J.M. (1978), Patterns of industrial innovation, Technology
Review, Vol. 80 No. 7, pp. 40-47.
Porter, Michael E. (1980), Competitive strategy: Techniques for analyzing industries and
competitors, The Free Press, London.
Porter, Michael E. (1990), The competitive advantage of nations, Palgrave MacMillan, London.
Porter, Michael E. (2004), Competitive advantage: Creating and sustaining superior
performance, The Free Press, London.

Website:
Asia-Pacific Economic Cooperation (APEC). Available at: http://www.apecsec.org.sg (August
2004).
Asian Trade Promotion Forum (ATPF) Countries. Available at: http://www.atpf.org (April &
August 2004).
Department of Statistics Malaysia (2003). Department of Statistics Malaysia Web Portal.
Available at: http://www.statistics.gov.my (March 2004).
Developing-8 (D-8) countries. Available at: http://www.mfa.gov.tr (August 2004).
Group of fifteen countries (G15). Available at: http://www.photius.com/g15 (April & August
2004).
Group of Seven/Eight countries (G7/8). Available at: http://www.groupseven.org (August 2004).

Reports:
Economic Report 2003/2004, Ministry of Finance (Malaysia), Percetakan Nasional Malaysia
Berhad, Kuala Lumpur, Malaysia.
Economic Report 2002/2003, Ministry of Finance (Malaysia), Percetakan Nasional Malaysia
Berhad, Kuala Lumpur, Malaysia.