business decision making

Topics: Monetary policy, International trade, Import Pages: 6 (1231 words) Published: March 16, 2015


Business Decision Making
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Table with the risks and weigh of their relative importance against the rate of return that I foresee for my companyaswell as a plan of overcoming the risks Risk
Importer
Exporter
L/M/S
How to Overcome It
Economic conditions
Poor economic conditions will affect my imports.
Poor economic conditions in other countries will affect my exports.  
If the demand for my imports is down, I will conduct marketing campaigns within my country so as to increase the demands for my goods. I will also export to countries where the demand for my products is high (Thomas A. 2012). Fluctuations in industry

The demand for my products will be low if I continue to import into the country.

The demand for my products will be low if I don’t have any other alternative country to export to.  
If the business of my imports fluctuates in my home country, I will have to diversify and import products whose industry has not fluctuated yet. If the industry fluctuates in the country I am exporting to, I will have to export to another country where the industry is still developed (Thomas A. 2012). Competition

If the competition is high, the demand for my products will be low.

If competition is high to the county I am exporting to is high, the demand for my products will be low.  
In order to fight competition, I will have to market my products through the various advertising avenues that are available. Technological change
A technology can be developed that will allow the production of imported goods to be done locally. Technology adopted by other countries I am exporting to will increase the competition of our products.  

In order to fight competition, I need to be innovative. Innovation will allow me to produce better goods. Change in preferences
The demand for my imports might be reduced by the changes in consumer preference. The demand for my exports might be reduced by the changes in consumer preference in the country I am exporting to.  

In order to adapt to the changes and preference in the market place, I will be forced to import as well as export goods that match the changes in consumer preference both in my country as well as the country I am exporting to. Costs and expenses

Costs of importing are high.
Costs of exporting might increase.
 
In order to not incur the high costs of importing, I will either decide to produce the goods locally or transfer the costs of importing to the consumer by increasing the prices of my goods locally. In order to not incur the costs I incur while exporting, I will set up production felicities in the counties I am exporting to (Thomas E. 2010). Regulations

Import regulations are high.
Export regulations are high.
 
With regards to regulation issues,I will have to abide to government regulations. Expropriation
Expropriation is least likely to occur on our business.
Expropriation is least likely to occur on our business.
 
N/A
Interest rates
Interest rates will increase my costs of production(Krista T. 2012). Interest rates do not affect imports.
 
Borrowing can be done from much cheaper sources such as souring for venture capital. Government monetary policy
Monetary policies such as increasing the value of the currency will make our business unprofitable. Monetary policies such as increasing the value of the currency will make our business unprofitable.  

We can export/import less when the currency is strong and import/export more when the country’s currency is weak. Government fiscal policy
Increase in import taxes would affect our business.
Increase in export taxes would affect our business.
 
Increasing our prices to the consumers.
Internal and external wars
A war in a country we are importing from would affect our import activities. Conflict within the country would bar us from exporting our products to other countries.  
If conflict...

References: Thomas A. COOK, Rennie ALSTON, Kelly RAIA (2012) Mastering Import & Export Management AMACOM Div American MgmtAssn
Thomas E. JOHNSON, Donna L. BADE (2010) Export/Import Procedures and Documentation
AMACOM Div American MgmtAssn
Krista Turner (2012) Import/Export Business: Entrepreneur 's Step-By-Step Startup Guide Entrepreneur Press, 2012
Krista Turner (2010) Start Your Own Import/Export Business, Third Edition Entrepreneur Press
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