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THE ECONOMY – UNIT 1
GDP (Gross domestic product) measures the economy of a country. It represents the total values of all goods and services produced over a specific period. It is an indicator that measures the health economy of a country. Two points of interests in a government policy are:
- Liberalizationfree markets and free movement of capital around the world;
- Protectionismgovernment intervention and restrictions on the movement of capital.
If consumers are confident about tomorrow (example to have a job), they will spend more. Interests’ rates are set by Central Banks. Cheap credit causes inflation and too much liquidity in the system. When the Central Banks sees the need to control inflation raising interest. Exchange rates makes imports cheap for domestic consumers, but hurts exporters (euro-dollar).
Effects of Globalization
- Financialeasier access to external financing;
- Politicalcloser relationships between governments;
- Informationalrapid flow of information;
- Culturaltravel and tourism, access to foreign products;
- Ecologicalinternational co-operation.
THE BUSINESS CYCLE – UNIT 2
History shows that there is a business cycle that repeats again and again.
The peak of the cycle
Inflation has become a problem. Borrowing is expensive. The stock market recognizes that the end is coming. Investors now switch to more defensive stock like consumers staples.
Contraction
Stock markets are falling. Central Banks see the danger and encourage spending. Bonds respond positively to the drop in rates, and they benefit.
The bottom of the cycle
Growth – expanding
Once there are early signs of growth, transportations pick up, and industry spends more on capital goods. During this period inflation starts to rise.
Eventually financials start to recover. Now the economy shows signs of strength and the whole cycle repeats again.
INTERNATIONAL TRADE – UNIT 3
Deciding to export:u
- Increase sales and production, reduce unit costs through economies of scale and increase profits if things go well;
- Diversify selling to other countries allows you to spread the risk.
Do research before export on the foreign market:
- Background economic situation, political stability;
- (^) Market size;
- Competitionsimilar products already into market;
- Distribution channelsagents or distributors;
- Promotional materiallocal language;
- Customer servicecomplaints, warranty claims;
- Legal requirements.
The first step in exporting is to involve an intermediary (agent or distributor). They will have local knowledge and contacts and they cpuld decide to establish its own presence in the foreign market. This allows direct contact with customers, faster delivery and more control on the local market. Two key issues for an exporter:
a. Method of payment;
b. Who pays for transportation.
Other options
Exporting is one way to sell your goods into a foreign market:
- Joint venturetwo companies work together but keep their own legal identity;
- Foreign direct investmenta business sets up operations in a foreign country;
- Licensingfranchinsing.
SETTING UP AND GROWING A BUSINESS – UNIT 4
Initial idea
Someone has an idea for a new business, a start up. They have a competitive edge, a bank will want security in case the loan is not repaid. Potential sources of finance for this new business include:
- Self funding;
- Backers;
- A bank loan;
GLOBAL ISSUED FOR THE 21st^ CENTURY – UNIT 6
- The growth of the BRICs: Brazil, Russia, India and China.
- The decline of the dollar: Central Banks will take less dollars and the price of oil will be priced with a different range of currencies.
- Climate change: global warming is happening.
- Peak oil: global oil production is going to peak very soon and prices are very high.
- Energy security and alternative energy: some countries have a lot of energy resources, others don’t. the one technology that might make a difference is nuclear.
- Absence of other resources: we are short of water China, Souther Europe and Middle East.
SALES – UNIT 18
Sales consultants have direct contact with the customers: they are the ones who really know what is going on the market. Marketing guys just sit in their office.
What qualities does a salesperson need?
- Knowleagdble;
- Well-prepared and organized;
- Reliable and flexible.
Sales technique
- General pointsshow interest in the customer;
- Discovering customer needsask a lot of questions, listen actively;
- Presenting the best casebuild a case slowly, base on the individual customer’s needs. Be clear and precise, emphasize benefits, be credible;
- Handling objectionsview an objections as an opportunity;
- Closingthe customers makes a reference to the product in use, the customer asks about what results they can reach (installation i.e.).
CUSTOMER SERVICE – UNIT 19
Is is a key business function that is often ignored. Nowadays, the quality of customer service can make big difference.
CRM (customer relationship management)
CRM is a software that allows the company to provide a unified face to customer. Having all sort of information’s like complaints, orders and warranty on screen is a huge advantage.
Active listening
This means:
- Let the customer explain the issue and pay full attention while they are speaking;
- Make written notes;
- If there is a problem apologize sincerely;
- If the conversation is face-to-face maintain an open build posture.
MARKETS AND MARKETING – UNIT 20
In a B2C company (business to consumer), customers can be divided according to:
- Demographics (age, gender);
- Psychographics (personality);
- (^) Geographics;
- Benefits looked for the customer (price);
- Current purchasing situation of the customer.
B2B (business to business) is a company that needs to know the type of customer, their size, the ownership. B2B customers are less interest in image and more interested in changing demands.
Who should we target?
After the decision about how to segment the market; they have to do:
- Target the mass market;
- Target multiple segments;
- Target one segment a niche market, specialized;
- Target individual customer with tailor-made productsthe Internet has been the catalyst fot this approach.
What is marketing?
Four Ps combine to form the marketing mix:
♦ Product;
♦ Place (distribution);
♦ Promotion;
♦ Price.
Marketing strategy: this includesanalysing the business environment using market research; developing new products and activity of competitors, innovation and cultural change.
PRODUCT – UNIT 21
Four key factors:
- Featurescharacteristics of a product that offers benefits to the customer;
- Brandinginvolves establishing an identity for a product. This is essential in similar product in competitive market. It usually include a design element such as a logo or a symbol. (B2CB2B)
- (^) Packagingit protects during shipping and handling;
- Public relationsmonitoring the media; keeping in contact with customers, organizing special events.
Other targets of promotion
Explaining a new product to the sales force and motivating them to sell it.
PRICE – UNIT 24
- Price is the most flexible and adjustable part of the marketing mix;
- Pricing decisions are critical for revenue;
- Price is important for first impression;
- Price is an important parte of sales promotions.
Internal factors that affect price
- Profitabilitya company usually requires a minimum return on its investment;
- Market sharea price may be set low to gain a position in the new market;
- Marketing strategyconsistency.
External factors
- Elasticity of demand;
- Customer expectations;
- Competitors product.
MARKETING MANAGEMENT – UNIT 25
Understanding of a business is often done using a 5Cs analysis:
- Customer analysis segments;
- Company analysiscompany’s cost structure;
- Collaborator analysis producing a profile of all the channels partners;
Competitor analysisstrength and weakness;
- Context analysis.
Market research
A variety of techniques are used:
- Quantitative researchquestionnaire on website;
- Qualitative researchinterviews or focus groups;
- Secondary researchdata collected by companies;
- Test marketingtest product in certain location.
Developing a marketing strategy
- Identify new markets;
- Developing new products and find a place;
- Developing competive advantages;
- Obtaining market share.
