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READINESS
Technological environment • Describe how the infrastructure in the country will affect communication with the supplier
Marketing benefits • Explore the image and reputation the source country has in the organization’s home country:
positive or negative?
Financial environment • Identify financial circumstances that could make it difficult for the importing organization to
make payments
• Circumstances might include monetary policy or the banking infrastructure
Labour environment • Describe the current and expected labour market conditions in the source country
Key Research Objectives for Importing
Domestic market • Identify whether there are tariffs or non-tariff barriers
conditions • Assess whether the product technology is compatible with required standards
Supplier selection • Identify all suppliers that possess the product, process or service that the organization
can use
• Assess reliability
• Assess skills gap
• Describe supplier’s previous experience
Physical selection • Describe how distribution and transportation facilities will affect delivery times
Management of the • Identify product or service adaptations that must be met to meet rules and requirements
business operation of the importing country
on an ongoing basis • Identify labelling standards
• Describe training procedures that must be in place for the employees
adv Disadv
o The information already exists and is readily o The information lacks specificity or does not exactly address
available -> quick & low cost question of concern
o Helps guide the focus of any subsequent o Some external secondary data may be of suspect quality or
primary research being conducted outdated
o Internal secondary data uses categories and o Internal secondary data such as sales reports and customer
breakdowns that reflect a corporation’s databases may only describe existing customers
preferred way of structuring the world o Information is less likely to exist, particularly in developing
o Secondary research may be the only available countries, due to the lack of primary research conducted in
source of specific pieces of information (i.e. unpopular markets or strict media control from the governments
government data
The two most frequently mentioned advantages of secondary data are the reduced costs involved with secondary research
and the shorter amount of time needed to obtain this information. These advantages take on great value for companies
involved in international trade research because of the distances involved, the limited familiarity with the target market
and the potential issues with language that can add substantial time and cost to data gathered through primary research
methods.
The main issue with secondary data is that someone else collected the information for a different purpose. This means
that researchers must validatethe data, the source and the collection methodology to verify its accuracy.
Sales and accounting records Baseline comparisons of trends, costs and target customers
Employees with experience in the target Opinions about general conditions, cultural impact and business
market methods
Trade or industry Practices, trends and conditions Various Fast access to publications, directories,
associations related to the organization’s websites yearbooks, statistics and market
expertise research reports
Publications, directors Market statistics, general Representatives Trade and market conditions specific to
and yearbooks information about trends, of the target the country and cultural considerations
interests, demands and country
regulations, sources of
information and advice
• Exploratory research involves collecting information informally to gain insights into some aspect of marketing
or trade. It is helpful in breaking very broad research problem statements into smaller and more manageable
statements. For example, researchers might visit a potential international market to investigate consumer
attitudes. Exploratory research projects often provide a basis for further research and usually involve gathering
qualitative information.
• Descriptive research is more structured than exploratory research and involves gathering information about a
market to explain the current market condition, current demographics or a current business problem. It is often
used to measure the frequency with which something happens or to compare market variables, and is useful in
establishing what is real, rather than what is assumed. For example, an organization considering exporting to
Japan might have heard about new regulations regarding wood packaging material. Descriptive research could
identify the regulations and any necessary certifications required.
• Causal research involves attempting to determine whether one market variable impacts another market
variable. The aim is to detect cause and effect relationships. For example, an organization attempting to break
into a new international market and not having much success might wish to carry out causal research to
determine whether a lower price will have a significant impact on sales.
• Ad hoc research involves investigating a single problem or opportunity at one point in time. Often, ad hoc
research involves gathering information from a range of sources in one specific time frame and is called cross-
sectional research. Cross-sectional research is useful for research objectives that involve investigating the
feasibility of an international trade venture, knowing the right time to make a business move or deciding
whether it is wise to launch a new product.
• Continuous research, also known as longitudinal research, involves long-term research to monitor trends in
customer attitudes and market attitudes. This involves obtaining information from the same sources or the same
consumer groups on several occasions over a defined time period. Continuous research is very useful for
investigating causal responses, such as purchasing habits in response to changing interest rates, or for following
trials of a new product or service.
The main advantage of primary data is that it is current and gathered to answer specific research objectives. Because the
research instruments used to gather primary data (observation, surveys, questionnaires, focus groups and panels) are
designed and used by the researchers, the information gathered is confidential and cannot be known by competitors. This
provides companies with a competitive edge. Although gathering primary data is usually slower than conducting
secondary research, some types of data sources, such as well- designed online polls, can generate results quite quickly.
Most primary data is difficult to collect. It can take a long time to develop the correct questions to ask and to decide who
to ask. Waiting for responses from surveys and questionnaires can create long delays. The level of effort involved with
developing and implementing tools to collect primary data can make this research expensive. These expenses can be
wasted if questions or target respondents are not chosen carefully and misleading data is obtained as a result.
VI. CACULATE
Uses and Comments and caculated
Mean • Add the value of each response and divide by the total number of responses
• Most data provided by secondary sources is in the form of a mean figure
• Used to draw conclusions about the actions of a group
• When calculated in units, multiply the mean by the total population size to estimate a total number of units
(e.g. market size)
• Mean can be skewed if some responses are much higher or lower than majority
Median • the value of the middle term
• Arrange responses from lowest to highest and find the value in the middle, with one half of responses above
and one half of responses below
• If extreme values exist, median can be a better measure
Ordinal refers to quantities that have a natural ordering. The ranking of favorite sports, the order of people's place in a
line, the order of runners finishing a race or more often the choice on a rating scale from 1 to 5.
Interval data is like ordinal except we can say the intervals between each value are equally split. The most common example
is temperature in degrees Fahrenheit. The difference between 29 and 30 degrees is the same magnitude as the difference
between 78 and 79
Ratio data is interval data with a natural zero point. For example, time is ratio since 0 time is meaningful. Degrees Kelvin
has a 0 point (absolute 0) and the steps in both these scales have the same degree of magnitude. Ratio Scale is defined as
a variable measurement scale that not only produces the order of variables but also makes the difference between variables
known along with information on the value of true zero. It is calculated by assuming that the variables have an option for
zero, the difference between the two variables is the same and there is a specific order between the options.
VIII. TERM
1. Gross national product (GNP): The market value of all final goods and services produced by the nationals of a country
in an annual time frame. GNP is often used as a measure of the size of a country’s economy, and incorporates income
derived from overseas activity.
2. Gross domestic product (GDP): The market value of all final goods and services produced in a country or region in an
annual timeframe. GDP per capita is often used as a measure of the standard of living in a country.
3. Purchasing power parity (PPP): Compares the purchasing power of different currencies in their domestic countries and
is often used as an alternative to GDP figures for measuring the standard of living in a country. PPP is calculated using the
amount of domestic currency needed to purchase a similar collection of goods in different countries.
4. Household disposable income: The is the average amount a household in a country has to spend after taxes and
payment of essential items, such as housing costs and utilities.
5. Market size: The market’s total number of buyers. The larger a country’s population, the larger the potential customer
base.
6. Market potential: Describes how many people or businesses in a country could realistically be expected to purchase a
product or service.
7. Market resources: The presence of natural resources in a country will have an impact on international business success.
The presence of resources such as oil, soil, timber and minerals increases a country’s wealth and leads to increased
development of infrastructure. It is also important for exporters to consider the geography and climate of a potential
market country, because both have an impact on the transportation of goods and dictate which products or services are
likely to be purchased. For organizations considering sourcing goods from an international market or setting up a
production site in a foreign county, the presence of resources needed for production processes will be essential for
success.
8. Market activity: In some cases, organizations will need to investigate the major economic industries present in a specific
country. For example, an organization wishing to sell building machinery might need to check whether a potential market
has its industry centred on agriculture rather than industry.
9. Infrastructure: A country’s infrastructure, such as the transportation network, the distribution of cities and major
centres, and the extent of the national power supply, will have an impact on the distribution of goods or services and the
costs involved with distribution. In some cases, this information will also indicate a need to adapt a product or service
(because the supply of electricity is intermittent, for example), or will indicate the unsuitability of exporting to that market.
Information about a country’s infrastructure will also give an idea of how effective business communications might be (for
instance, the availability of telephone, Internet and mail services) and how easy it will be to travel to the country for
meetings and to monitor business activities.
10. Urbanization: The amount of urbanization in a country is a measure of that country’s demand for certain goods and
services and its income levels. In general, workers in urban areas are paid higher wages than workers in rural areas.