International Trade and Service Industry

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Questions and Answers

What does the Delivery Gap refer to?

The difference between service efficiency and customer expectations

The difference between the firm's service standards and the actual service provided (correct)

The gap between production cost and selling price

The difference between customer demand and service capacity

What is the main purpose of implementing tariffs?

Protect local businesses (correct)

Increase government revenue

Reduce customs duties

Facilitate trade agreements

Which of the following best describes Power Distance?

The measures taken to reduce social stratification

The acceptance and expectation of social inequality within a society (correct)

The gap between societal classes in salary distribution

The level of economic disparity within a country

What characterizes a Strategic Alliance?

A contractual partnership without equity participation between firms Signup and view all the answers

Which of the following best describes the responsibilities during international shipping as defined by Inco-terms?

Responsibility shifts from buyers to shippers. Signup and view all the answers

What does a trade deficit indicate?

Imports exceed exports Signup and view all the answers

Which statement about scorecards is accurate?

Weighted point Scorecards assign weights based on relevance of each performance category Signup and view all the answers

What is the least risky strategy for entering foreign markets?

Exporting products Signup and view all the answers

Which of the following actions does NOT represent government interventions in trade?

Promoting open market competition without restrictions Signup and view all the answers

What do the components of the global market assessment include?

Economic Analysis, Technological Analysis, Government Analysis, Socio-cultural Analysis Signup and view all the answers

How is the Gini Index interpreted in relation to income distribution?

A lower number indicates more equal distribution. Signup and view all the answers

What factor limits the amount of imported goods a country can receive?

Quotas Signup and view all the answers

Which country was noted as the top trading partner of the U.S. in 2023?

Mexico Signup and view all the answers

What does GDP measure within a country's borders?

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

Which of the following is a key legislation related to safety and health issues in workplaces?

OSHA Signup and view all the answers

Which quality is NOT considered a key performance indicator (KPI) for sustainability?

Measuring the cost of sustainability Signup and view all the answers

What does a perfect order imply?

Every aspect of an order is fulfilled correctly Signup and view all the answers

Which of the following components is essential for defining a KPI?

Starting benchmark, target achievement, time frame Signup and view all the answers

What is the main characteristic of a free market?

Focus on consumer and competitor interests Signup and view all the answers

Which of the following is NOT an important quality of data?

Price Signup and view all the answers

What term describes the difference between customers' expectations and a firm's perception of those expectations?

Knowledge gap Signup and view all the answers

What does infrastructure primarily refer to in a community?

The basic facilities and services needed for functioning Signup and view all the answers

How does the length of time to resolve service failure typically affect customer satisfaction?

It leads to higher levels of customer irritation. Signup and view all the answers

What distinguishes a weighted point scorecard from other scorecard types?

It incorporates weights for various performance categories. Signup and view all the answers

What is the primary role of tariffs in international trade?

To protect local businesses Signup and view all the answers

Which statement best describes the term 'power distance'?

The extent to which social inequality is accepted as a norm. Signup and view all the answers

In free markets, what influences decision-making the most?

The interests of consumers and competitors Signup and view all the answers

What does an embargo represent in trade?

A prohibition of trade with a specific country Signup and view all the answers

Which of the following best describes joint ventures?

New companies created by two or more international firms Signup and view all the answers

What is a zone of tolerance in service delivery?

The range of acceptable service outcomes Signup and view all the answers

Which factor is most associated with a trade deficit?

Importing more than exporting Signup and view all the answers

What is the significance of the Gini Index?

It assesses income distribution within a population Signup and view all the answers

Which of the following characterizes the macro-influence on international business?

Geo-political issues Signup and view all the answers

What is the least risky method for businesses entering foreign markets?

Exporting products Signup and view all the answers

What is the primary measure of economic performance from one year to another?

GDP Growth Signup and view all the answers

Which of the following characteristics is NOT true about a perfect order?

The order can be returned without issues Signup and view all the answers

What does the Knowledge Gap represent in a business context?

The disparity between customer expectations and the firm's understanding of those expectations Signup and view all the answers

Which components are essential for defining a Key Performance Indicator (KPI)?

Starting benchmark, target achievement, and time frame Signup and view all the answers

Which of the following sustainability KPIs is relevant?

Green-house gas emissions Signup and view all the answers

What defines a free market in terms of consumer engagement?

A competitive environment focused on consumer preferences and rival businesses Signup and view all the answers

What does OSHA primarily focus on?

Ensuring workplace safety and health Signup and view all the answers

What is a prevalent characteristic of metrics used in organizations?

Action-oriented, objective, and tied to organizational goals Signup and view all the answers

Study Notes

Foreign Trade Zones

Aim to decrease customs duties (taxes)
Main reason for tariffs: protecting domestic businesses
Government regulations create issues with importing
Inaccurate paperwork causes delays and extra costs

USMCA

Includes the United States, Canada, and Mexico
Macro-influence: geopolitical issues play a role
Embargoes: restrictions on trade
Incoterms: define responsibility shifts during international shipments
Joint ventures: new companies formed by international businesses

Trading Company

US's top trading partner in 2023: Mexico
Zone of tolerance: acceptable time frame for arrival

Service Industry

Doctors' offices: service-dominant companies (not product-based)
Service jobs increasing in countries like the US
Service reduction through trading

Communication and Customer Service

Gap between promised service and actual delivery
Managing customer expectations to reduce the gap
Four characteristics of services: intangible, inseparable, heterogeneous, perishable
Delivery gap: difference between provided service and standards

Entering Foreign Markets

Direct interaction with customer service: delivery gap
Strategies: exporting is least risky, setting up shop is riskiest, opportunities with brick and mortar nations
Limits on imports: quotas
Highest return: direct investment
Worries about infrastructure when expanding
Trade deficit: importing more than exporting
Equilibrium elements: cost, exchange rates

Global Market Assessment

Four elements: Economic, infrastructure, government, sociocultural
Hofstede's cultural dimensions: High Power Distance, Low Individualism -Brazil
Globalization: facilitates global trade

Globalization and Local vs Global

Global perspective important in a globalizing world
Gini index: measures income inequality
0: perfect equality; 100: one person has all the income (extremely unequal)
Dense areas/populations need more resources/stores
Global context vs local knowledge
Skill-level, productivity, labor costs

Sustainability

KPIs: Green-house gas emission, energy, waste from production
Order fill rate: order filled divided by total orders
Characteristics of metrics: action-oriented, objective, results-oriented, root cause analysis
Perfect order: everything goes right during the order process
KPI qualities: accuracy, completeness, timeliness

Other

Important components of KPI: benchmarking, target achievement, time frame
Global Supply Chain Assessment: environment, infrastructure, business issues
GDP growth: reflects economic performance
Services (intangible, etc): any performance or offering that can't be physically kept
Customer service: meeting customer needs with human or mechanical assistance.
Performance categories for companies weighed for performance: Categorical scorecards
Cost-based scorecards: quantifying business costs with suppliers

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Description

Explore the intricacies of foreign trade zones, regulations, and the impact of international agreements like USMCA on trade between the United States, Canada, and Mexico. Understand the growing significance of the service industry and how customer service plays a pivotal role in managing expectations in the trading domain.