International Business Opportunities and Challenges Study Set 2

One of the biggest challenges in selling to emerging markets involves making the product affordable.

Counterfeit markets hurt companies that have invested in building intellectual assets such as unique product designs, technological developments, costly media content, and carefully crafted brands.

The existence of gray-market activity across a country's border has a positive impact on the producer and their channel partners (e.g., distributors and retailers) in the higher-priced country.

In the case of outsourcing, the company pays the outsource vendor for the end result; how the vendor achieves the end result is up to the vendor.

In the case of offshoring, the vendor takes control of the operations and runs the operations as they see fit.

A multibrand strategy is not advisable when a country has a strong, positive association with a particular brand.

The purpose of segmentation is to give the company a concrete vision of its customers, so that it can better understand how to market to that customer.

The disadvantage of straight product extension is that a company's products may not be well suited to local needs.

In the case of outsourcing, the firm retains control of the operations and directly hires the employees.

One advantage of straight product extension is that the products may be less costly due to lower manufacturing and labour costs in the United States.

The downsides of safety stock include the increased costs of carrying that inventory such as the investment in the products, taxes and insurance, and storage space.

Intermediaries in the channel of distribution can include distributors, wholesalers, agents, brokers, retailers, international freight forwarders, and trading companies.

Counterfeit markets are illegal because they purposely deceive the buyer.

Understanding the market's culture and social trends is irrelevant when it comes to doing business in the emerging economies of the world.

All citizens of a given country can be marketed to uniformly.

The world does become flatter to the extent a brand is recognized, accepted, and trusted across borders.

The advantage of straight product extension strategy is that the company doesn't need to invest in new research, development, or manufacturing.

Gray markets are illegal and the operators in the market are punishable by law.

In the case of the indirect channel of distribution, there are no intermediaries between the consumer and the producer.

Multiple brands may resonate more with specific markets, especially if a company merges with or acquires a local brand that is well respected in that region.