Question

Global Analysis. Discuss the importance of globalization of business in today’s world and the trend. Discuss global issues that impacted your company’s opportunities and performance. For example, how have tariffs, transportation costs, exchange rates impacted your company’s production and selling decisions? How do exchange rate changes affect your decision and operation? Discuss differences and similarities in product demand among regional markets in which you chose to compete. Outline any potential global factors that may affect your future productions/operations.

Answer 1

Ans ; The importance of Globalization refers to the changes in the world where we are moving away from self-contained countries and toward a more integrated world. Globalization of business is the change in a business from a company associated with a single country to one that operates in multiple countries.

And when we talk about Impact of Globalization,

The impact of globalization on business can be placed into two wide categories: market globalizationand production globalization.

Market globalization is the decline in barriers to selling in countries other than the home country. This change will make it easier for your company to begin selling products internationally, since lower tariffs keep consumer prices lower and fewer restrictions when crossing borders makes it easier for a company to enter a foreign market. It also means that companies must consider other cultures when developing their business strategies and potentially adjust the product and marketing messages if they aren't appropriate in the target country. This may not be an issue in the camera industry, but a hamburger company entering India would definitely need to revisit their product and strategies to be successful!

And the transportation costs and production costs affect the profitability of a firm, therefore It mainly affect the location of the industry or country to trade with. ..When adding transportation costs to the prices of traded goods, a nation's volume of trade decreases.

Production globalization is the sourcing of materials and services from other countries to gain advantage from price differences in different nations. For example, you might purchase materials and components for your cameras from multiple countries and then assemble the product in yet another international location to reduce your costs of production. This change should lead to lower prices for consumers since products cost less to produce. It also impacts jobs, since production may shift from one country to another, usually from more developed countries to less developed countries with lower average wage rates.

The balance of trade influences currency exchange rates through its effect on the supply and demand forforeign exchange. ... In contrast, if a country imports more than it exports, there is relatively less demand for its currency, so prices should decline. In the case of currency, it depreciates or loses value

There are two main types of markets for products, in which the forces of supply and demand operate quite differently, with some overlapping and borderline cases. In the first, the producer offers his goods and takes whatever price they will command; in the second, the producer sets his price and sells as much as the market will take. In addition, along with the growth of trade in goods, there has been a proliferation of financial markets, including securities exchanges and money markets.