Selecting a foreign country as the market

for a firm’s product of services requires

an analysis of the business
environment in the
foreign country.
THE ECONOMIC ASPECTS

The economic aspects include a foreign country’s inflation rates, population data,
unemployment rates, exchange rates, size of foreign debts, balance of trade
position, gross domestic product (GDP) size and per capita, interest rates and
capital market.

 Income indicates costumers ability to spend on  Interest rates, if interest rates are too high, the
the products sold by the marketer. In some cases, cost of borrowing may not permit business to
higher income, higher demand of luxury and expand.
lifestyle products but in some countries despite
having higher income, costumers will not spend on  Unemployment rate, if unemployment rate is too
products that are not consider to be desirable. high, business can obtain labor at cheaper cost.
 Inflation refers to an increase in prices without
increase is wages resulting to low purchasing
power of consumers. In some cases if the
marketer has a high supply and low demand the
marketer reduces their price.
LEGAL-POLITICAL ASPECTS

The political system and form of government in a foreign country can have
impact on the operations of firms. Policies of taxation, wage legislation,
government expenditure plans, investment incentives, intensity of competition
and subsidies, can be influenced by the political structure and cultural of a
country.

 Political factors can add in a risk factor which can lead to major loss in business.
 Taxes and Economic Policies, if tax is increase, the price also increase. Higher taxes
can lead to high inflation.
 Political Stability, lack of political stability (peace and order) can lead to looting, riots
and general disorder which can disrupts business operations.
TECHNOLOGICAL ASPECTS

The state of Information Technology (IT) development and E-commerce

development in a foreign market should be considered in order to determine the
availability of personnel that will provide skills necessary for efficient operations
as well as the infrastructure needed for computer and internet technologies.
Included here is the infrastructure for the communication system in foreign
markets that facilitate information flows between companies and individuals from
different countries.
 Efficiency of Operations. Technology also helps a business understand its cash flow needs and preserve precious resources
such as time and physical space. Warehouse inventory technologies let business owners understand how best to manage the
storage costs of holding a product. With proper technology in place, executives can save time and money by holding meetings
over the Internet instead of at corporate headquarters.
 The chosen foreign market should have a progressive educational system ensuring a continuous supply of highly-skilled
employees.
INFRASTUCTURE DEVELOPMENT

Infrastructure development impact on operations particularly on marketing and

production. These include road networks, rail systems, airports, land
transportation, shipping, etc.

 Transportation is a major contributor to the economy and a competitive force in business. It is the activity that physically connects
the business to its supply chain partners, such as suppliers and customers, and is a major influence on the customer’s
satisfaction with the company.
GEOGRAPHICAL INFLUENCES

These include the climate season, natural resources, location of country and
population concentration.
 Transportation is a major contributor to the economy and a competitive force in business. It is the activity that physically connects
the business to its supply chain partners, such as suppliers and customers, and is a major influence on the customer’s
satisfaction with the company.
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THE ECONOMIC ASPECTS
TEXT LAYOUT 1
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 $50,000

CHART
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$0
20XX 20XX 20XX 20XX 20XX

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TABLE Category
20XX 20XX 20XX

SLIDE
0 400,000 1,600,000
Category 500,000 4,000,000 16,000,000
Category 75 80 90
Category 5,625,000 48,000,000 216,000,000
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Category 0 0 0
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consectetuer Category 5,625,000 48,000,000 216,000,000
adipiscing elit, sed Category 1,687,500 9,600,000 21,600,000
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Category 281,250 2,400,000 4,320,000
Category 7,593,750 52,800,000 187,920,000

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VIDEO SLIDE

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THANK
YOU!
Alexander
Martensson
Phone
678-555-0128
Email
martensson@example.com
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