International Competitiveness Essay

International competitiveness: Even when the TESCO is doing its business in its own country, other international competitors or international or doing the same business could affect its operation or marketing. For example the Wall-Mart, which is doing the similar business, could impact its sale. If the competition given by WALL Mart is tough then it would be difficult for TESCO to operate there

In this report I am going to define the meaning of Globalisation and assess the impact of globalisation on the way the business operate.

1.Briefly describe reasons for Phillips and Matsushita to operate internationally. Why do they do it?
Describe the international strategy of Phillips and Matsushita using the international strategy classifications we discussed in class (e.g., localization, transnational, global).

The economy exchange rate: If a start-up business buying products from abroad, than the exchange rate will impacts on the piece of goods. This will affect a start-up business because if the exchange rates are like 2 Euros to the £1 than they will make profit but if the exchange rate is like 1 Euros to the £1 than they won’t be able to make profit.

The term competitiveness defines the ability of a region to export more than its imports while including all “terms of trade” to reflect government legislation and import barriers. In other words, according to the world competitiveness report, competitiveness is “… the ability to design, produce, and market goods and services, the price and non- price characteristics of which form a more attractive package than those of competitors.” (Pg3.) Each nation has different competitiveness level, which relies on multitude factors such as; raw materials, innovative technologies, energy prices, the type of economy, legislations, and the exchange rate fluctuations. Nevertheless, the prosperity of countries depends on the nation’s competitiveness status.

Competitiveness in relation to (please address all items in the below list and provide support for your

Which is cost difference determines the patterns of international trade. Absolute advantage is trade benefits when each country is at least cost producer of one of the goods being traded. In the 1800s, David Ricardo developed the theory of comparative advantage to measure gains from trades. This theory is based on comparative advantage and it states each nation should specialize in production of those goods for which its relatively more efficient with a lower opportunity cost.

For export-oriented groups, having a weaker dollar makes these producers more competitive in the global market. This also makes foreign exporters less competitive domestically, this increases the competitiveness of domestic importer-competing producers. These aspects combined enhance one’s export-competitiveness. The Wall Street Journal insinuates that decreasing the revenue gained from export oriented sectors is damaging to the economy, stating “of those countries that do face [economic] problems, the cause is often clear: The plunge in commodities prices is a huge hit to exporters” (“Global Growth and Markets”). Critics argue that having a strong dollar is a good thing because it makes foreign products domestically and then domestic producers must match those prices to remain competitive (“Chapter 12: A Society”). The main idea behind this critique is that it increases the incomes of those

Movements in the exchange rate for the Australian dollar against currencies of Australia’s trading partners influence international competitiveness. Increasing international competitiveness means increasing productivity through the better use of resources. Increasing competitiveness suggests that goods and services produced in Australia will be more attractive in domestic markets. Australia’s international competitiveness has fluctuated quite widely during the past two decades. Changes in international competitiveness over time will affect the goods and services balance and therefore the current account in the balance of payments. The competitiveness of Australia’s exports and import competing goods and services can depend on a variety of factors,

2. How would leveraging capabilities with respect to the Indonesian market differ between an Australian/New Zealand producer of computer software and an Australian/New Zealand manufacturer of automotive parts?

However, pressure from the open market has posed big challenges for the national economy, especially to domestic businesses due to their limited competitiveness and small-scale production. Moreover, there has been ineffective use of foreign capital and the progress of foreign investment disbursement is still slow. Therefore,  how to make full use of advantages to develop a healthy comparative environment and strictly implement commitments to create good conditions for businesses actually is a controversial question.

So, keeping those in mind the company can adopt a localization strategy in international markets; in every market that they have entered they may produce products just like they did to Asian people. Furthermore, lower prices can show products less qualified in international markets, especially in Europe and America, for those markets the company can came up with an alternative product line that is more niche.

In the article “The Competitive Advantage of Nations” Michael Porter describes a diamond shaped relationship of forces that define a country’s potential for being competitive in a specified industry. The four points on the diamond representing the different forces are: factor conditions; demand conditions; firm strategy, structure and rivalry; and related and supporting industries. According to Porter, the four points apply pressure to each other resulting in a national

Measuring a potential business venture has many aspects which the international manager must be aware of in order to convey the correct information back to the decision makers. Being ignorant to any of the aspects can lead to a false representation of the project, and hence an uninformed decision being passed. In order for a business to survive it must grow. For growth to be optimal, management must first be able to identify the most attractive prospective leads. The country as a whole, specifically geography, government, and financial aspects must be looked at in order to yield the best possible picture of the market a company wishes to enter. Concentration should be placed on gathering reliable facts

Manufacturing adjusts to meet a constant return on the product (Hunt & Morgan, 1995). Effectively, these theories rely on national monopolistic models to explain comparative advantage (Ossa, n.d.). While the standard of comparative advantage explains why trade can exist between countries, the assumptions do not account for conditions of increasing returns and imperfect competition.