MKT 230 1st Edition Lecture 13Outline of Last Lecture I. InfluencesII. Psychological InfluencesIII. Level of InvolvementIV. Problem Solving StrategiesV. Social InfluencesVI. Business MarketsOutline of Current Lecture I. International Business and ForcesII. Lumber Liquidators CaseIII. Regional Trade Alliances, Markets and AgreementsCurrent Lecture – Monday, March 2, 2015I. International Business and Forcesa. International Marketing – Developing and performing marketing activities acrossnational bordersb. Environmental Forcesi. Dramatically different in international marketsii. What are customer’s expectations in difference countries?  Have to be considered by the companyiii. Requires proper environmental analysisc. Sociocultural Forcesi. These have a significant impact as well; they include things like education,religion, family, etc.d. Hyperinflationi. In Zimbabwe it would cost 3 trillion dollars for a loaf of bread.These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.ii. A company wouldn’t want to enter this market because it would be almost an immediate lossiii. Companies have to consider what is going on/what has recently happened in the countryiv. One thing that needs to be examined is how stable the government ise. Economic Forcesi. Instability is GAURANTEEDii. However, there is a lot of potential for growth and opportunityiii. Global markers must understand:1. International trade systems2. Economic stability/instability of nations3. Trade barriers4. Economic disparities between nationsiv. Example: China is in Liberian market for agriculture and makes a lot of money off their rubberv. There are a lot of differences between nations. Differences exist in things like:1. Standards of living2. Availability of credit3. Buying powervi. GDP (Gross Domestic Product): anything that can add to a nation’s wealthwill help their GDPvii. Embargo – suspension of trade in particular product or with a given country1. Example: US used to have an embargo on Cubaviii. Balance of trade – difference in value between exports and imports1. In the US our main exports are food and farm products and we import a lot of consumer goods2. Strike on the West Coast slows down imports and has effect on price through less supply and more demand3. Similarly there is an oil strike on the West Coastf. Ethical and Social Responsibility Forcesa. There is a difference in ethical standards depending on what country you are in.b. Bribes are okay in other countriesc. Intellectual Property is handled differently as wellg. Contract Manufacturing – hiring foreign firms to product a productII. Lumber Liquidators – prime example of contract manufacturing.a. They hired mills in China to make their laminate floors and they are now in the middle of a scandal because their floors are not anywhere close to the level of toxic chemicals that is allowed b. What could be the cause?i. Greedii. Lack of communicationiii. Bad ethicsiv. Government not doing their jobIII. Regional Trade Alliances, Markets, and Agreementsa. NAFTA – North American Free Trade Agreement – between Canada, the US, and Mexico; it eliminates most tariffs and trade restrictions on agricultural and manufactured products to encourage tradeb. EU – European Union – one of the largest single markets in the world. Has 27 countriesc. WTO – World Trade Organization – International organization dealing with the rules of trade between nations; represents 95% of global