World Business Superbook Book 1. World Business-Trade Guide 1 (Doing Business Worldwide)

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World trade runs the world if you think about it. Simply walk through a supermarket or a shopping mall and look at the tags of some of the products to see where they're made.

Most of us don't realize the incredible amount of motion going on all the time as goods and services are transported all over the world to end up neatly packaged on our store shelves at reasonable prices. It is indeed a miracle.

Whereas once before, you just competed with companies in your own country or in your own continent, nowadays, you're competing with countries halfway around the world (Japan and Germany are the number two and three economies) for a piece of the global pie.

We, in North America, have to be exceptional if we hope to counteract the great advantages emerging nations have with their cheap labor and absence of environmental laws which makes production so much easier overseas for general products that don't require skilled labor so if these types of factories and production are to stay in America and not be relegated to China or India, we had better be damn good and efficient at what we do otherwise we will become a consumer nation buying all of our manufactured stuff from China, Japan, India and Mexico.

The potential is there for a North American company to expand to the global marketplace if we want to. We have the one great advantage of the best technology the world has to offer, a great infrastructure and a well developed transportation system such that we can ship anything we want anywhere in a matter of a week or two at the latest or we can fly it there by air cargo in a day or two. This is our competitive edge not to mention that we have abundant natural resources, at least in Canada.

In general, there are two markets:

a consumer market, making products for mass consumption by the public at large;

an industrial market, making products for business and industry so they can do what they do to produce goods and serves.

As far as the industrial market goes, North America gets the lion's share of the world market share because most of the world's technology is located here, was developed here, is invented here and we have the greatest availability of skilled labor here.
As far as the consumer market goes, because of volume of sales, good products can be made anywhere and sold anywhere. The consumer market goes from beer to TVs to ipods to pop music.

Whoever makes the best product and sells it at the lowest price wins which is why the Asian countries seem to be winning this game. They know how to make good products cheaply. There are your two bottom line factors right there:

Quality.
Low Price.

How can North Americans compete with this? For one thing, we can stick with what we do best and make our money there, namely industry, high technology, medical equipment, agriculture and natural resources.

For the consumer market, we, as individual companies, have to focus on our individual products, try to make them as good as we can as efficiently as we can to capture niche markets worldwide. This is what it's called, niche marketing, find what you're good at, do it the best you can and sell it worldwide.

At one time, after World War Two, America made virtually everything on the planet. They sent a few business experts, I believe the one guy's name was Deming, over to Japan and twenty years later, the Japanese were mass producing most of the world's electronic components.

Good companies eventually develop subsidiaries in other countries, branch plants where they basically replicate what they do at the mother company thus alleviating the hassles of exporting thereby winning favor from the country itself for investing there.

We mustn't forget that easily over half of the world doesn't come close to having near the technology we have in North America. I read that in Eastern Europe they don't even have a flow of uninterrupted electricity. That's how much more advanced w


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