International Trade and Foreign Trade Zones

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Questions and Answers

What does the Delivery Gap refer to?

The time taken to resolve customer complaints

The cost of delivering services to customers

The difference between expected and actual service provided (correct)

The discrepancy between profit margins and service quality

Which statement about cultural factors is true?

Power distance refers to the equal distribution of power in society.

Cultural differences are always minimal and do not affect business.

Culture encompasses shared meanings, beliefs, and values of a group. (correct)

Most countries primarily communicate through written documents.

What distinguishes a Strategic Alliance from other types of partnerships?

It creates an equity partnership between the firms.

It requires a formal legal contract to be valid.

It involves a financial investment from both firms.

It is a collaborative relationship without equity sharing. (correct)

Which type of scorecard takes into account the costs associated with doing business over time?

Cost-based Scorecards Signup and view all the answers

Which of the following is an action that governments typically take to influence trade?

Implementing tariffs and trade agreements Signup and view all the answers

What is the primary reason for implementing tariffs?

Protect local businesses Signup and view all the answers

What is the major issue faced when importing goods?

Government regulations Signup and view all the answers

Which of the following best describes the concept of an embargo?

A restriction on trade Signup and view all the answers

What is indicated by a trade deficit?

Importing more than exporting Signup and view all the answers

What shift occurs in responsibility during international shipping according to Inco-terms?

From buyers to shippers Signup and view all the answers

What does the Gini Index measure?

Income distribution Signup and view all the answers

Which of the following characteristics is NOT associated with services?

Homogeneous Signup and view all the answers

What is the least risky strategy for entering foreign markets?

Exporting products Signup and view all the answers

What does GDP measure?

The yearly value of finished goods and services produced within a country's borders Signup and view all the answers

What is the essence of a Free Market?

It allows consumers and competitors to interact freely Signup and view all the answers

Which of the following is NOT considered a KPI for sustainability?

Measuring the cost of sustainability Signup and view all the answers

What does high order fill rate indicate?

All orders have been filled Signup and view all the answers

What are the three most important qualities of data?

Accuracy, Completion, Timeliness Signup and view all the answers

What defines a 'Perfect Order'?

An order with no errors throughout the process Signup and view all the answers

In the context of services, what does 'perishable' imply?

Services cannot be stockpiled Signup and view all the answers

What does a categorical scorecard measure?

Overall performance check Signup and view all the answers

What effect does a lengthy resolution of service failure have on customers?

Customers experience increased irritation. Signup and view all the answers

Which of the following best describes the concept of infrastructure?

Basic facilities and services essential for a society's function. Signup and view all the answers

What does power distance represent in a cultural context?

The acceptance of inequality in social structures. Signup and view all the answers

What is a key characteristic of a strategic alliance?

A collaborative relationship without equity involvement. Signup and view all the answers

Which category of scorecard assigns weights to different performance metrics?

Weighted Point Scorecards Signup and view all the answers

What is the primary impact of foreign trade zones on customs duty?

Decrease customs duty Signup and view all the answers

Which of the following is true regarding the characteristics of services?

Services are perishable Signup and view all the answers

Which country was the top trading partner for the U.S. in 2023?

Mexico Signup and view all the answers

What is a major risk factor when entering foreign markets?

Setting up a new shop Signup and view all the answers

What does the term quota refer to in international trade?

A limit on the amount of imported goods Signup and view all the answers

What is typically a direct outcome of inaccuracies in paperwork during importing?

Delays and extra costs Signup and view all the answers

Which index measures income distribution in a population?

Gini Index Signup and view all the answers

What are brick nations known for in the context of global markets?

Significant opportunities for market growth Signup and view all the answers

What is the primary purpose of OSHA legislation?

To ensure safety and health in the workplace Signup and view all the answers

Which of the following is NOT a component of a KPI?

Risk assessment Signup and view all the answers

What does the order fill rate measure?

The ratio of orders fulfilled to orders placed Signup and view all the answers

Which characteristic is essential for data to be effective?

Timeliness Signup and view all the answers

What does it mean if a service is described as 'perishable'?

It cannot be stockpiled Signup and view all the answers

What are sustainability KPIs primarily used for?

To assess environmental impact Signup and view all the answers

What defines a perfect order in a supply chain context?

An order where every aspect is correctly fulfilled Signup and view all the answers

What is measured by GDP?

The yearly value of all finished goods and services produced domestically Signup and view all the answers

Study Notes

Foreign Trade Zones

Aims to decrease customs duty (taxes)
Main reason for implementing tariffs: Protect domestic businesses first
Government regulations are a concern when importing
Inaccurate paperwork results in delays and added costs
USMCA includes the US, Canada, and Mexico

Macro-influences

Geo-political issues are a factor
Embargo: Trade restrictions imposed
Incoterms: Define responsibility shifts during international shipping
Joint ventures: Two or more international companies form a new entity

Trading Companies & Entities

Mexico is the top trading partner for the US (2023)
Zone of tolerance: Acceptable time allowance for arrival
Service-dominant companies (e.g., doctor's offices) are increasing in the US

Reducing Service Gaps

Businesses use trading to reduce service gaps
Communication gaps exist between promised service and customer experience
Managing customer expectations (promised vs. received)
Key characteristics of services: Intangible, inseparable, heterogeneous, perishable
Delivery gaps exist between the actual service and service standards/policies

Entering Foreign Markets

Direct interaction with customers is important in service delivery (delivery gap)
Entering foreign markets through brick-and-mortar is high-risk
Exporting is the lowest-risk entry strategy for new markets
Increased opportunity for market growth in brick-and-mortar nations
Quota limits imported goods
Direct investment is the highest possible return

Market Assessment

Exchange rates are needed for equilibrium in global market assessments
Economic, infrastructure, governmental, and socio-cultural analyses are important
Hofstede's framework aids in understanding cultural dimensions (e.g., power distance, individualism)
Globalization enables cross-border movement of goods and services

Global Economics

GDP - Yearly value of finished goods and services in a country
Global markets focus on consumer behavior and competitor analysis
OSHA (Occupational Safety and Health Administration) oversees safety and health issues
Sustainability KPIs include greenhouse gas emissions, energy consumption, and waste

KPI (Key Performance Indicator) Measurements

Order fill rate: Orders filled vs. total orders
Metrics should be actionable, objective, and focused on results.
Perfect order: Achieving all aspects of an order correctly
Key KPI qualities include accuracy, completeness, and timeliness
Important elements of KPIs include benchmark, target, time frame
Sustainability KPIs are essential in monitoring performance
Categorical scorecards quantify performance

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Description

This quiz explores key concepts related to international trade, including foreign trade zones, macro-influences, and trading companies. Learn how government regulations and geopolitical issues impact trade dynamics and service gaps in the marketplace. Test your knowledge on major trading partners and the evolving role of service-dominant companies.