MKTG 335G Exam #1 Notes PDF

**Chapter 1: The Scope and Challenge of International Marketing** ***1.1: the benefits of international markets*** \- International marketing affects and is affected by worldwide events. -People in international commerce goes by "expect the unexpected" \- International markets are unpredictable...

**Chapter 1: The Scope and Challenge of International Marketing** ***1.1: the benefits of international markets*** \- International marketing affects and is affected by worldwide events. -People in international commerce goes by "expect the unexpected" \- International markets are unpredictable events by planning and forecasting -Natural fluctuations in markets are best managed by building strong interpersonal and commercial relationships and broad portfolios of business -flexibility means survival \- even if U.S companies do not want to do international companies, they cannot ignore other U.S companies, importing, exporting or manufacturing abroad nor ignore foreign-based companies in U.S markets, growth in national trade areas, rapid growth in world markets, and the increasing number of competitors in global markets. ***Trends that will influence and shape International Business in the future:*** 1. The rapid growth of the world trade organization (WTO) and new free trade agreements around the world. 2. The trend towards acceptance of free market system among developing countries such as Latin America, Asia, and Europe. 3. The impact of the internet, mobile phones, and other global media on the dissolution of national borders 4. The mandate to manage the resources and global environment properly for generations to come. -Every business must be prepared to compete in a increasingly interdependent global economic and physical environment due to the global dimensions of communication, technology, research, capital investment, production, distribution, and marketing. \- The challenge of international marketing is to develop strategic plans that are competitive in these intensifying global markets. -International is no longer a luxury, but a necessity of economic survival. ***1.2: The competitive challenge face of U.S. businesses from outside competition.***  \- with the increasing globalization of markets, companies find they are unavoidably enmeshed with foreign customers, competitors and suppliers, even in their own borders. -They face competition in all fronts both domestic and foreign firms. -Many familiar U.S companies are now foreign controlled or headed in that direction. \- Foreign companies that have entered the U.S through exporting their products have realized a sufficient market that justifies building and buying manufacturing plants in the U.S. -Is relatively new for U.S companies having their global competitors competing in the U.S. -The vast U.S market has provided an opportunity for continued growth and has to share with a variety of foreign companies and products. -Companies with domestic markets are now seeking foreign markets to expand their business while foreign companies found that foreign earnings make important contribution in corporate profits. -Multinationals of all sizes and industries outperform domestic counterparts due that they grew up as twice as fast in sales and reduce manufacturing employment. ***What is International Marketing?*** The performance of business activities designed to plan, price, promote, and direct the flow of a company's goods and services to consumers or users in more than one nation for a profit -The difference between international marketing and domestic marketing is that international marketing takes place **in more than one country.** -The uniqueness of foreign markets comes from the range of unfamiliar problems and the variety of strategies that are necessary to cope with the different levels of uncertainty in foreign markets \- Marketing is interesting due to the challenge to combine controllable elements within the framework of uncontrollable elements so that the marketing objectives are achieved -Difficulties created by domestic environment is the international marketer primary concern. ***1.3: The scope of the international marketing task*** -The international marketers' task is more complicated than domestic marketer due that they have to deal with at least two levels of uncontrollable uncertainty except of one. ***Controllable Elements*** The aspects of trade over which a company has control and influence; they include marketing decisions covering product, price, promotion, distribution, research and advertising. -They can be altered in the long run and short run to adjust changing market conditions, consumer tastes or corporate objectives. ***Uncontrollable Elements*** Factors in the business environment over which the international marketer has no control or influence; includes competition, legal restraints, government controls, weather consumer preferences and behaviors and political events. -Marketers have to evaluate, adapt and adjust to determine the outcome of the marketing enterprise. ***Domestic Environmental Uncontrollables*** Factors in a company's home country over which the company has little or no control or influence. They include political and legal forces, economic climate, level of technology, competitive forces and economic forces. ***Foreign Environmental Uncontrollables*** Factors in foreign markets over which a business is operating in its home country has little to no control or influence. They include political and legal forces, economic climate, geography and infrastructure, level of technology, structure of distribution. ***1.4: The importance of the self-reference criterion (SRC) in international marketing*** -The key to successful international marketing is adaptation to environmental differences from one market to another is to anticipate the influences of both foreign and domestic uncontrollable factors on a marketing mix to adjust it. ***Self-Reference-Criterion (SRC)*** An unconscious reference to one's own cultural values, experiences, and knowledge as a basis for a decision ***Ethnocentrism*** The notion that people in one's own company, culture, or country know best how to do things. -self-reference-criterion can prevent you from being aware of cultural differences, making you fail to recognize the need to act or react to a situation in an offensive way -The most effective way to control ethnocentrism and src influence is to recognize their effects in our behavior not by knowing every single country's culture, but more by awareness or differences between cultures ***Self-Reference-Criterion Steps*** 1. Define the business problem or goal in home-country cultural traits, habits, and norms. 2. Define the business problem or goal in foreign country cultural habits, or norms through consultation with natives of the target country make no value judgments. 3. Isolate the SRC influence in the problem and examine it carefully to see how it complicates the problem. 4. Redefine the problem without the SRC influence and solve for the optimum business goal situation. ***1.5: The increasing importance of global awareness*** -To be globally aware is to have **1) Tolerance and willingness to learn about cultural differences.** **2) Knowledge of cultures, history, world market potential, global, economic, social, and political trends.** ***Tolerance*** Understanding cultural differences and accepting and working with others whose behavior may be different from yours. -A tolerant person understands the differences that may exist between cultures and uses that knowledge to relate effectively. ***Global Awareness*** A frame of reference, important to success of a businessperson, that embodies tolerance of cultural knowledge and differences of cultures, history, world market potential, and global, social, and political trends. -Global awareness should be built in organizations by using strategies of selecting individual managers to demonstrate global awareness or build professional relationships in other countries, but nothing works better than to have culturally diverse senior executive staff or board of directors. ***1.6: The progression of becoming a global marketer*** ***Factors Favoring Faster Internationalization*** 1. Companies with either high-technology and/or marketing-based-resources appear better equipped to internationalization than more traditional manufacturing companies. 2. Smaller home markets and larger production capacities appear to favor internalization 3. Firms with key managers well networked internationally are able to accelerate the internalization process. ***Stages of International Marketing Involvement*** ***No Direct Foreign Marketing*** -A company in this stage does not actively cultivate customers in other countries but their products may reach foreign markets. -Sales would be made by trading companies as well foreign customers contacting the firm. -Product also may reach foreign markets via domestic wholesalers or distributors that sell abroad without the knowledge of the producer. -Websites may also receive orders from foreign customers. -An unsolicited order from a foreign consumer is what piques the interest of a company to seek international sales. ***Infrequent Foreign Marketing*** -Temporary surpluses from fluctuating production or demand may result in infrequent foreign marketing overseas. -Sales to foreign markets as goods become available with little to no intention of maintaining continuous market representation -As domestic demand increases and absorbs surpluses, foreign sales activity is reduced or withdrawn -Little to no change is seen in this stage in the company organization or product lines. Few companies fit this model due to customers seeking long-term relationships -Financial return for short term international expansions are limited. ***Regular Foreign Marketing*** -At this level, a firm has a capacity to produce goods and services for foreign markets. -They can employ foreign domestic overseas subsidiaries or have their own sales force or subsidiaries in important markets. -Their primary operation focus is domestic market needs. -As overseas demand grows, production is allocated, and products are adapted to meet the needs of individual foreign markets. -Company becomes dependent of foreign sales and profits to meet its goals. ***International Marketing*** -In this stage companies are fully involved in international marketing activities. -Companies seek market around the world and sell products as a result of planned production for markets in various countries. -The planning entails production of goods and services outside the market. -It becomes an international or multinational marketing firm. ***Global Marketing*** -At this stage companies treat the world, including home markets as one market. -Market segmentation is no longer focused on national borders, instead are defined by income levels, usage patterns, or other factors that frequently span countries and regions -They begin to take a global perspective. ***Global Orientation*** Operating as if all the country markets in a company scope of operations were approachable by a single market **Chapter 2: The Dynamic Environment of International Trade** ***2.1: The basis for the reestablishment of world trade following WWII*** -After WWII, the US set out the infuse of the ideal of capitalism to dampen the spread of communism.\ -The Marshall plan for the reconstruction of Europe, and the financial and industrial development Japan, Funds of the Agency for International Development, groups deigned to foster economic growth in the undeveloped world were the ones that helped creak a strong world economy. -Countries gain economic independence, economies grew, and new markets were created. -The US helped make the world's economies stronger by every investing dollar in the US for economic development and rebuilding countries after WWII hundreds of dollars return from the purchase of US agricultural products, manufactured goods, and services. -Determined to not repeat the economic disaster of WWI GATT (General Agreements on Tariffs and Trade) was created to reduce tariffs and other barriers of trade. -In 1995, with the ramification of Uruguay Round Agreement GATT became a part of WTO -During the 1950s, many US companies started to market outside the US and began to export due to the rapid growth of war-torn economies and previously undeveloped countries, with large-scale economic operation and assistance led to global market opportunities. -By the end of the 1960s, US multinational corporations (MNCs) were facing two challenges: Resistant to direct investment and increase competition in export markets.\ -The American Challenge, a popular book published in 1960 written by the author J.J Servan-Schreiber stated that *"Fifteen years from now it's quite possible that the world's third greatest industrial power, just after the US and Russia, will not be Europe but America industry in Europe. Already in the nineth year of common market European markets are basically American in organization"* -This actually didn't become true due to the resurgence of competition all over the world. Japan, Germany, most industrialized world and developing countries were competing in demand in their own countries and looking for World Markets as well. -Countries once classified as lees developed become industrialized countries such as Brazil, Mexico, South Korea, Hong Kong. -economic power and potential become more evenly distributed among countries. -Companies are looking for ways to be more efficient, improve productivity, and expand their global reach while maintaining and ability to respond quickly and deliver products that markets demand, as well as smaller companies. ***2.2: The importance of balance-of-payment figures to a country's economy.*** ***Balance of payments*** The system that accounts that records international financial transactions \- It records all financial transactions between its residents and those of the rest of the world during a given period of time-usually one year. -The records are maintained on a double entry bookkeeping system; it always must be in balance. -Balance of payments does not mean a nation is practically good or in poor financial condition. -Presents an overall view of its international economic position and is an important economic measure used by treasuries, central bank or other government agencies whose responsibility is to maintain external and international economic stability. ***Current account*** Records all merchandise exports, imports, and services, plus unilateral transfers of funds. -Is the primary interest of International Business because it includes all international merchandise trade and service accounts. ***Capital account*** Records direct investments, portfolio investments, and short-term capital movements to and from countries Reserves account Records export and imports of gold increases and decreases in liabilities to foreign central banks. ***2.3: The Effects of Protectionism on World Trade*** ***Protectionism*** The use by nations of legal barriers, exchange barriers, and psychological barriers to restrain entry of goods from other countries -Business work together to establish private market barriers while the market structure itself may provide formidable barriers to imported goods. ***Reasons to maintain government restrictions*** 1. Protection of infant industry. 2. Protection of home market. 3. Need to keep money at home. 4. Encouragement of capital accumulation. 5. Maintenance of the standard of living and real wages. 6. Conservation of natural resources. 7. Industrialization of a low-wage nation. 8. Maintenance of employment and reduction of employment. 9. National Defense 10. Enhancement of business size 11. Retaliation 12. Corrupt goals of despots and their ilk ***2.4: The Several Types of Trade Barriers*** ***Nontariff barriers*** Restrictions other than tariffs placed by countries on imported products; they may include quality standards, sanitary and health standards, quotas, embargos, boycotts, and antidumping penalties -Barriers are imposed against imports and foreign businesses ***Tariff*** A fee or tax that countries impose on imported goods, often to protect a country's markets from intrusion from foreign countries -Tariffs may be used as revenue generating taxes or to discourage the importation of goods. ***Types of Custom Duties*** Ad Valorem duties: are based on the percentage of the determined value of the imported goods. Specific duties: a stipulated amount per unit weight or some other measure of quantity Compound duties: combines both specific and ad valorem taxes on a particular item. -Tariffs increase **inflationary pressures, special interest privileges, government control and political consideration in economic matters, and the number of tariffs.** \- Tariffs weaken **balance-of-payments positions, supply and demand patterns and international relations.** -Tariffs restrict **manufactures supply sources, choices available to consumers, and competition.** -Tariffs are arbitrary, discriminatory, and require constant administration and supervision. ***Quota*** A specific unit or dollar limit applied to a particular type of good. -Quotas put absolute restriction on the quantity of a specific item that can be imported. -They tend to increase prices. -The difference between a quota and an import license is that quotas permit importing until the quota is filled while licensing limits quantities on a case-by-case basis. ***Voluntary Export Restraints (VERS)*** Agreements similar to quotas between an importing country and an exporting country for a restriction on the volume of exports. Also known as Orderly Market Agreement (OMAS) -Is called voluntary because the exporting country sets the limits -Generally imposed under the threat of stiffer quotas and tariffs being set by the importing country if a VER is not established. ***Boycott*** An absolute restriction against the purchase or importation of goods and/or services from other countries -This includes travel bans and can be either formal or informal and could be government sponsored or by an industry. ***Embargo*** A refusal to sell to a specific country. ***Blocked Currency*** -mostly used as political weapon or a response to a difficult balance of payments situation. -cuts off all importing or above a certain level. -Is also accomplished by refusing to allow an importer to exchange national currency for the seller's currency. ***Government Approval*** -Mostly used by countries that are experiencing severe shortages of foreign exchange. -Importers that would want to buy a foreign good must apply for a exchange permit which gives permission to exchange an amount at a local currency for foreign currency ***Standards*** -They include standards to protect health, safety and product quality. -Sometimes are used in an unduly stringent or discriminating way to restrict trade, but the sheer volumes of regulations is a problem itself. ***Antidumping Penalties*** -They were designed to prevent foreign producers from predatory pricing, a practice whereby a foreign producer intentionally sells its products on the U.S for less than the cost of production to undermine competition and control the market. ***2.5: The provisions of the Omnibus Trade and Competitiveness act*** -Omnibus Trade and Competitiveness act was made in 1988 -The trade act was designed total with trade deficits, protectionism and the overall fairness of our trading partners. -Mostly focused on the Issue that the US were open to most of the world, but Japan, Europe and some Asian countries were not relatively closed -It reflected that we must deal with our trading partners based on how they actually operate and not how we want them to behave. ***Market Access*** -Many barriers restrict or prohibit goods from entering a foreign market. -Unnecessarily restrictive technical standards, compulsory distribution systems, custom barriers, tariff, quotas, and restrictive licensing requirements are just few. ***Export Expansion*** -Export licenses could be obtained more easily and more quickly for products on the export control list. -In addition, the act reaffirmed the government's role in being more responsive to the needs of the exporter. ***Import Relief*** -Provides a menu of remedies for US businesses adversely affected by imports -Companies seriously injured by fairly traded imports can petition the government for temporary relief while they adjust to import competition and regain competitive edge. ***2.6: What is GATT and the World Trade Organization?*** ***GATT*** *(General Agreements on Tariffs and Trade)* a trade agreement signed by the United States and 22 other countries shortly after WWII. The original agreement provided a process to reduce tariffs and created and agency to patrol world trade. -The agreement covers three basic elements 1\) Trade shall be conducted on a non-discriminatory basis 2\) Protection shall be afforded domestic industries through custom tariffs, not through such commercial measures as import quotas. 3\) Consultation shall be the primary method used to solve global trade problems. World Trade Organization (WTO) The organization formed in 1994 that encompasses the GATT structure and extends it to new areas that had not been adequately covered in previously the WTO adjudicates trade disputes. All 164 member countries have equal representation. -WTO ensures that member countries agree the obligations of all agreements, not just those they like. ***2.7: The emergence of International Monetary Fund and the World Bank Group*** ***International Monetary Fund (IMF)*** A global institution that, along with the World Bank Group, was created to assist nations in becoming and remaining economically viable. -Plays an important role in the environment of international trade by helping maintain stability in the financial markets and by assisting countries that are seeking economic development and restructuring. -the IMF objectives are the stabilization of foreign exchange rates and the establishment of freely convertible currencies to facilitate the expansion and balanced growth of international trade. -It also lends money to members having trouble meeting financial obligations to other members. ***Special Drawing Rights (SDRs)*** A "paper gold" that represents an average base of value derived from the value of a group of major currencies. -Trade contracts are frequently written in SDRs because they are much less susceptible to exchange rate fluctuations. -Some countries permit their currencies to float cleanly without manipulation (clean float), whereas other nations systematically manipulate the value of their currency (dirty float) ***World Bank Group***\ Institution that has a goal the reduction of poverty and the improvement of living standards by promoting sustainable growth and investment in people.\ -Provides loans, technical assistance, and policy guidance to developing country members to achieve its objectives World Bank Services 1. Lending money to the governments of developing countries to finance development projects in education, health, and infrastructure. 2. Providing assistance to governments for developmental projects to the poorest developing countries. 3. Lending directly to help strengthen the private sector in developing countries with long-term goals, equity investments, and other financial investment. 4. Providing investors with investment guarantees against "non-commercial risk" 5. Promoting increased flows of international investment by providing facilities for the conciliation and arbitration of disputes between governments and foreign investors. ***Chapter 3: History and Geography: The Foundations of Culture*** ***3.1: The importance of History and Geography in Understanding Cultural markets*** ***Culture*** A society's accepted basis for responding to external and internal events. -To understand fully a society's actions and points of view, you must have an appreciation for the influence of historical events and geographical uniqueness a culture has to adapt. ***3.2: The effects of history on a country's culture*** ***First Opium Was and the Treaty of Nanjing (1839-1842)*** Two wars were fought between China and Britain over the British-run opium trade in China during the middle of 1800s. The British Navy attacked Chinese ports in retribution for a Chinese ban on the drug, and the Treaty of Nanjing was signed in 1842 allowed greater European access to Chinese ports generally a resumption of the opium trade and ceding Hong Kong to British Control -The war became about foreign access to Chinese trade -The treaty also included provisions of allowing Cristian evangelism throughout the realm. ***Taiping Rebellion (1851-1864)*** The most costly civil war in human history of China during 1851-1864 some estimates have the death toll between 20 million to 40 million. ***Confusion Philosophy*** The 2500-year-old teachings of Chinese philosopher Confucius still strongly influences cultures in East Asia today. Primary among his teachings was a deep respect for elders, rulers, and husbands. -Emphasizes the basic virtue of loyalty "Of friend toa friend, wife to a husband, of child to parent, of brother to brother, but above all subject to the lord" -Reflects the importance of cooperation for the collective good. ***3.3: How Culture Interprets Events Through its Own Eyes*** -Historical events always are viewed from one's own biases and self-reference-criterion (SRC), and thus what is recorded by one historian may not be what another records, especially if they are different cultures. -Perspective not only influences our view in history but also subtly influences our view of many other matters. -A crucial element in understanding any nation business and political culture I the subjective perception of its history ***Manifest Destiny*** The notion that Americans were a chosen people ordained by a god to create a model society; it was accepted as the basis for U.S policy during much of the 19^th^ and 20^th^ centuries as the nation expanded its territory. -The idea of Manifest Destiny was used to justify the US annelation of Texas, Oregon, New Mexico, and California, and later U.S involvement in Cuba, Alaska, Hawaii and the Philippines. ***Monroe Doctrine*** A corner store of U.S foreign policy as a enunciated by President James Monroe, it proclaimed three basic dicta: no further European colonization in the New World, abstention of the United States from European political affairs, and non-intervention of European government in the governments of the Western Hemisphere. ***Roosevelt Corollary*** An extension of U.S policy applied t the Monroe Doctrine by President Theodore Roosevelt, stating that the United States not only would prohibit non-American Intervention in Latin American Affairs but also would police Latin America and guarantee that all Latin America nations would meet their international obligations. ***3.4: How long-past U.S International Policies Still Affect Customer Attitudes Abroad*** ***Expropriation*** The seizure of an investment by a government in which one reimbursement is made to the invested owner; often the seize investment becomes nationalized. -To understand a country's attitudes, prejudices, and fears, it is necessary to look beyond the surface of current events to the inner subtleties of the country's entire past for clues. ***3.5: The Effect of geographic diversity on economic profiles of a country.*** -Examining the world as a whole provides the reader with a broad view of world markets and an awareness of the effects of geographic diversity on the economic profiles of various nations. \- Climate and topography are examined as facets of the broader and more important elements of geography. ***3.6: Why Marketers Need to be Responsive to the Geography of a Country*** -Altitude, humidity, and temperature extremes are climatic features that affect the uses and functions of products and equipment. -Products that perform well in temperate zones may deteriorate rapidly or require special cooling or lubrication to function adequately in tropical zones. \- Within even a single national market, climate can be sufficiently diverse to require major adjustments. -Different seasons between the northern and southern hemispheres also affect global strategies. -Mountains, oceans, seas, jungles, and other geographical features can pose serious impediments to economic growth and trade. -Geographic hurdles have a direct effect on a country's economy, markets, and the related activities of communication and distribution. ***Geography, Nature, and Economic Growth*** -Always on the slim margin between subsistence and disaster, countries with few economic resources suffer disproportionately from natural and human-assisted catastrophes. -As the global rush toward industrialization and economic growth accelerates, environmental issues become more apparent. -Disruption of ecosystems, relocation of people, inadequate hazardous waste management, and industrial pollution are problems that must be addressed by the industrialized world and those seeking economic development. ***Social Responsibility and Environmental Management*** -Nations, companies, and people reached a consensus during the close of the last decade: Environmental protection is not an optional extra; it is an essential part of the complex process of doing business. ***Greenhouse-gas Emissions*** There are gasses resulting in primarily from the use of fossil fuels that tend to trap heat in the earth's atmosphere are casual factors in global climate change. The main problem compounds are carbon dioxide, methane, nitrous oxide, and fluorinated gases. -The process of controlling industrial wastes lead to another critical issue, the disposal of Hazardous waste. -Countries are encountering an increasing difficulty in the disposal of wastes at home seeking countries willing to assume the burden of disposal. -Governments, organization, and businesses are becoming increasingly concerned with the social responsibility and ethical issues surrounding the problem of maintaining economic growth while protecting the environment for future generations ***Sustainable development*** An approach toward economic growth that has been described (by Joke Waller-Hunter) as a cooperative effort among businesses, environmentalists, and other to seek growth with "wise resource management, equitable distribution of benefits, and reduction of negative efforts on people and the environment from the process of economic growth" ***Resources*** -In much of the undeveloped world, human labor provides the preponderance of energy. -The principal supplements to human energy are animals, wood, fossil fuels, nuclear power, and, to a lesser and more experimental extent, the ocean's tides, geothermal power, and the sun. -Of all the energy sources, oil and gas contribute over 60% of world energy consumption. -The location, quality, and availability of resources will affect the pattern of world economic development and trade well into the 21sr century. ***3.7: The Economic Effects of Controlling Population Growth and Aging*** ***Dynamics of Global Population Trends*** -Demographics such as current population, rural/urban population shifts, migration patterns, rates of growth, age levels, epidemics, pandemics, and population control help determine today\'s demand for various categories of goods and services. -Although not the only determinant, the existence of sheer numbers of people is significant in appraising potential consumer markets. -Changes in the composition and distribution of population among the world\'s countries will profoundly affect future demand. Moreover, it now appears that demand for goods worldwide can affect migration patterns, in a reversal of the traditional causal relationship. ***Populations*** -Procreation is one of the most culturally sensitive, uncontrollable factors. -Economics, self-esteem, religion, politics, and education all play critical roles in attitudes about family size. -The prerequisites to population control are adequate incomes, higher literacy levels, education for women, universal access to healthcare, family planning, improved nutrition, and perhaps most important, a change in basic cultural beliefs regarding the importance of large families. -Perhaps the most important deterrent to population control is cultural attitudes about the importance of large families. -Family planning and all that it entails are by far the most universal means governments use to control birthrates, but some economies believe that a decline in the fertility rate is a function of economic development prosperity and will come only with economic development. ***Rural/Urban Migration*** -Migration from rural to urban areas, which can consist of domestic or international moves, is largely a result of a desire for greater access to sources of education, healthcare, and improved job opportunities. -Estimates indicate that by 2030 more than 61% of the world's population will live in urban areas, and at least 27 cities will have populations of 10 million or more, 23 of which will be in the less-developed regions. ***Population Decline, Aging, and Disease*** -As a result of contemporary factors, population growth in many countries has dropped below the rate necessary to maintain present levels. -At the same time that population growth is declining in the industrialized world, there are more aging people today than ever before. -Europe, Japan, and the United States epitomize the problems cause by an increasing percentage of elderly people who must be supported by a declining number of skilled workers. -The US currently is suffering for the so-called opioid epidemic and their metabolic syndrome, obesity, cardiac disease, orthopedic problems and diabetes. Which their primary cause is the rich American diet. ***3.8: Communication Infrastructures are an Integral Part of International Commerce*** -An underpinning of all commerce is effective communications- Knowledge of where goods and services exist and where they are needed and the ability to communicate instantaneously across vast distances. -Continuous improvements in electronic communications have facilitated the expansion of trade. -Each Revolution in technology has had a profound effect on human conditions, economic growth, and the manner in which commerce functions. -Each new communications technology has spawned new business models; some existing businesses have reinvented their practices to adapt to the new technology, while other businesses have failed to respond and thus ceased to exist.