The 5 P’s of International Business

If youre enquire why nations trade with each other. Its because of the 5 Ps Product, Price, Proximity Promotion, and Preference.ProductNo country can evoke all its own goods and services, a trade is obvious solution. A countrys resources coif what goods and services it can produce.PriceDue to wages, taxes, render and other transportation costs, the costs of producing various goods from country to country may vary. Businesses in foreign countries may be able to produce products cheaper, which they can sell their products at a lower price at Canada. ProximityBorder cities such as Windsor and Ontario are tremendously influenced by their American counterparts. Businesses from both sides of the border share and step in goods and services.PromotionWith global technology such as the internet, business can let people farther away know about the goods and services they are selling.Factoring Affecting The Flow Of Goods ServicesConsumer Needs and In entersThe amount of bills that consu mers have to spend has a direct impact on the flow of goods and services in a country. In some parts in the world some people have a make do of money to spend while in other places peoples income barely cover basic needs.Currency determineMost nations have their own kind of currency. The exchange rate refers to the value of ones country currency against the currencies of other countries. It helps determine how much we pay for imported goods and services and how much we receive for what we export. When the Canadian dollar signs falls, imported goods become to a greater extent expensive, and we tend to reduce the volume of our imports. How To Convert To Other CurrenciesConverting Canadian To other CurrencyCanadian dollar is profession at 80 US Cents How legion(predicate) US dollars will purchase $40 deserving of Canadian products?Amount = Fund x site1 Can = 0.8 US1 x 40 Can = 0.8 x 40 US40 Can = 32 US$32American to buy $40 worth of Canadian products.Converting Another Currency To CanadianGiven that the Canadian dollar is trading at 90 US cents. How many Canadian dollars will purchase $70 worth of American products?Amount = 1 divide Rate x Fund1 Can = 0.9 US1 divide 0.9 CAN = 0.9 divide 0.9 US1.11 x 70 Can = 1 x 70 US77.78 CAN = 70 US$77.78Canadian to buy $70 worth of American products.Advantages And Disadvantages Of planetary BusinessAdvantages increased markets for businessesa broader choice of products, services, and prices for consumerscreate jobsexchange knowledge which results in new approaches to production, marketing, and selling.political benefits partners in trade seldom go to warfare with each otherimprove understandingincrease the level of respect people have for one another.Disadvantages less money to spend on domestic goodsnew industries will not be able to compete with well-established industries in other countriesunfair competition collectible to cheap foreign labourcompetition from foreign enterprises may lead to losing of jobsBarriers To International BusinessTariffCountries place a tax called a tariff on-in-coming goods to protect domestic manufacturing. A tariff barrier slows the entry of foreign goods by do them more expensive.QuotaThis is a limit on the number of products in a category that can come into a country.The quota on clothing and textile import.EmbargoEmbargo is a complete stop to the transfer goods and it is often utilize as a form of political or social protest. Health and Safety Standards Countries can adjust such high health and safety standards for imported goods that it becomes more difficult for foreign competitors to enter the market. workmanship Agreement & PactsOne of the earliest trade agreements the GATT ( General Agreement on Tariffs and Trade) brought over 100 major trading nations in 1947.It was based on 3 major principlesequal non-discriminatory treatment for all member nationsgeneral simplification of tariffsthe eliminations of non-tariff barriers