International trade is the exchange of capital , goods , and services across international borders or territories because there is a need or want of goods or services. (see: World economy )
77-503: An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is an exporter ; the foreign buyers is an importer . Services that figure in international trade include financial, accounting and other professional services, tourism, education as well as intellectual property rights. Exportation of goods often requires
154-405: A company must only choose one of the three or risk that the business would waste precious resources. Porter's generic strategies detail the interaction between cost minimization strategies, product differentiation strategies, and market focus strategies of firms. Michael Porter described an industry as having multiple segments that can be targeted by a firm. The breadth of its targeting refers to
231-479: A company pursues competitive advantage across its chosen market scope. There are three/four generic strategies, either lower cost, differentiated , or focus. A company chooses to pursue one of two types of competitive advantage, either via lower costs than its competition or by differentiating itself along dimensions valued by customers to command a higher price. A company also chooses one of two types of scope, either focus (offering its products to selected segments of
308-485: A component of gross domestic product , along with domestic consumption , physical investment , and government spending . Foreign demand for a country's exports depends positively on income in foreign countries and negatively on the strength of the producing country's currency (i.e., on how expensive it is for foreign customers to buy the producing country's currency in the foreign exchange market ). International trade In most countries, such trade represents
385-460: A firm to rebrand itself or its products if it chooses to shift to a differentiation strategy in future. Differentiate the products/services in some way in order to compete successfully. Examples of the successful use of a differentiation strategy are Hero, Asian Paints, HUL, Nike athletic shoes (image and brand mark), BMW Group Automobiles, Perstorp BioProducts, Apple Computer (product's design), Mercedes-Benz automobiles. A differentiation strategy
462-486: A firm. In particular, Miller questions the notion of being "caught in the middle". He claims that there is a viable middle ground between strategies. Many companies, for example, have entered a market as a niche player and gradually expanded. According to Baden-Fuller and Stopford (1992) the most successful companies are the ones that can resolve what they call "the dilemma of opposites". Furthermore, Reeves and Routledge's (2013) study of entrepreneurial spirit demonstrated this
539-521: A great advantage to use a differentiation strategy (for big companies) in conjunction with focus cost strategies or focus differentiation strategies. Coca-Cola and Royal Crown beverages are good examples of this. The shareholder value model holds that the timing of the use of specialized knowledge can create a differentiation advantage as long as the knowledge remains unique. This model suggests that customers buy products or services from an organization to have access to its unique knowledge. The advantage
616-550: A key player in metals. There were already concerns that the UAE was a main recipient of majority of the smuggled gold from DRC. Lists Data on the value of exports and imports and their quantities often broken down by detailed lists of products are available in statistical collections on international trade published by the statistical services of intergovernmental and supranational organisations and national statistical institutes. The definitions and methodological concepts applied for
693-414: A low cost strategy is rarely able to provide a sustainable competitive advantage . In most cases firms end up in price wars . Instead, they claim a best cost strategy is preferred. This involves providing the best value for a relatively low price. This strategy involves the firm winning market share by appealing to cost-conscious or price-sensitive customers. This is achieved by having the lowest prices in
770-462: A pragmatic approach for a firm. Critical analysis done separately for cost leadership strategy and differentiation strategy identifies elementary value in both strategies in creating and sustaining a competitive advantage. Consistent and superior performance over competition could be reached with stronger foundations in the event “hybrid strategy” is adopted. Depending on the market and competitive conditions, hybrid strategy should be adjusted regarding
847-453: A restaurant that turns tables around very quickly, or an airline that turns around flights very fast. In manufacturing, it will involve production of high volumes of output. These approaches mean fixed costs are spread over a larger number of units of the product or service, resulting in a lower unit cost, i.e. the firm hopes to take advantage of economies of scale and experience curve effects . For industrial firms, mass production becomes both
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#1732798420526924-555: A significant share of gross domestic product (GDP). While international trade has existed throughout history (for example Uttarapatha , Silk Road , Amber Road , salt roads ), its economic, social, and political importance has been on the rise in recent centuries. Carrying out trade at an international level is a complex process when compared to domestic trade . When trade takes place between two or more states , factors like currency, government policies, economy, judicial system , laws, and markets influence trade. To ease and justify
1001-429: A similar effect to subsidies ; tariffs reduce the industry's incentives to produce goods quicker, cheaper, and more efficiently, becoming ever less competitive. The third basis for a tariff involves dumping . When a producer exports at a loss, its competitors may term this dumping . Another case is when the exporter prices a good lower in the export market than in its domestic market. The purpose and expected outcome of
1078-513: A similar effect, they are not usually regarded as trade barriers. The most common foreign trade barriers are government-imposed measures and policies that restrict, prevent, or impede the international exchange of goods and services. International agreements limit trade-in and the transfer of certain types of goods and information, e.g., goods associated with weapons of mass destruction, advanced telecommunications, arms and torture and also some art and archaeological artifacts . For example: Although
1155-555: A small but profitable market niche. Firms in the middle were less profitable because they did not have a strategy. Porter suggested combining multiple strategies is successful in only one case. Combining a market segmentation strategy with a product differentiation strategy was seen as an effective way of matching a firm's product strategy (supply side) to the characteristics of your target market segments (demand side). But combinations like cost leadership with product differentiation were seen as hard (but not impossible) to implement due to
1232-879: A specific production, thereby increasing the advantages of specific trade over specific local production. Forms of local products that are highly localized may not be able to meet the efficiency of more large-scale, highly consolidated production in terms of efficiency, including environmental impact. A systematic, and possibly first large-scale, cross-sectoral analysis of water , energy and land in security in 189 countries that links total and sectorial consumption to sources showed that countries and sectors are highly exposed to over-exploited, insecure, and degraded such resources with economic globalization having decreased security of global supply chains . The 2020 study finds that most countries exhibit greater exposure to resource risks via international trade – mainly from remote production sources – and that diversifying trading partners
1309-408: A sports team's star players or a brokerage firm's star traders), or innovative processes. Successful differentiation is displayed when a company accomplishes either a premium price for the product or service, increased revenue per unit, or the consumers' loyalty to purchase the company's product or service (brand loyalty). Differentiation drives profitability when the added price of the product outweighs
1386-461: A startup or small company to offer a cheaper product or service where incumbents' costs and prices have become too high. An example is the success of low-cost budget airlines who, despite having fewer planes than the major airlines, were able to achieve market share growth by offering cheap, no-frills services at prices much cheaper than those of the larger incumbents. At the beginning low-cost budget airlines chose "cost focused" strategies but later when
1463-583: A strategy and an end in itself. Higher levels of output both require and result in high market share, and create an entry barrier to potential competitors, who may be unable to achieve the scale necessary to match the firms low costs and prices. The second dimension is achieving low direct and indirect operating costs. This is achieved by offering high volumes of standardized products , offering basic no-frills products and limiting customization and personalization of service. Production costs are kept low by using fewer components, using standard components, and limiting
1540-511: A substitute for trade in factors of production. Instead of importing a factor of production, a country can import goods that make intensive use of that factor of production and thus embody it. An example of this is the import of labor-intensive goods by the United States from China . Instead of importing Chinese labor, the United States imports goods that were produced with Chinese labor. One report in 2010, suggested that international trade
1617-543: A tariff is to encourage spending on domestic goods and services rather than their imported equivalents. Tariffs may create tension between countries, such as the United States steel tariff in 2002 , and when China placed a 14% tariff on imported auto parts. Such tariffs may lead to a complaint with the World Trade Organization (WTO) which sets rules and attempts to resolve trade disputes. If that
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#17327984205261694-401: A tax on a specific good or category of goods exported from or imported to a country, is an economic barrier to trade. A tariff increases the cost of imported or exported goods, and may be used when domestic producers are having difficulty competing with imports. Tariffs may also be used to protect an industry viewed as being of national security concern. Some industries receive protection that has
1771-438: Is a key factor in organisation success, differentiation and cost leadership were the least important factors. However, contrary to the rationalisation of Porter, contemporary research has shown evidence of successful firms practising such a “hybrid strategy”. Research writings of Davis (1984 cited by Prajogo 2007, p. 74) state that firms employing the hybrid business strategy (Low cost and differentiation strategy) outperform
1848-482: Is appropriate where the target customer segment is not price-sensitive, the market is competitive or saturated, customers have very specific needs which are possibly under-served, and the firm has unique resources and capabilities which enable it to satisfy these needs in ways that are difficult to copy. These could include patents or other Intellectual Property (IP), unique technical expertise (e.g. Apple's design skills or Pixar's animation prowess), talented personnel (e.g.
1925-477: Is based on the fundamental that differentiation will incur costs to the firm which clearly contradicts with the basis of low cost strategy and on the other hand relatively standardised products with features acceptable to many customers will not carry any differentiation hence, cost leadership and differentiation strategy will be mutually exclusive. Two focal objectives of low cost leadership and differentiation clash with each other resulting in no proper direction for
2002-663: Is famous for squeezing its suppliers to ensure low prices for its goods. Other procurement advantages could come from preferential access to raw materials, or backward integration. Keep in mind that if you are in control of all functional groups this is suitable for cost leadership; if you are only in control of one functional group this is differentiation. For example, Dell Computer initially achieved market share by keeping inventories low and only building computers to order via applying Differentiation strategies in supply/procurement chain. This will be clarified in other sections. Cost leadership strategies are only viable for large firms with
2079-665: Is growing. In fact, the GDP growth is expected to hit 7% by the IMF. However, exporters, who export products and get paid mostly in dollars, suffer because of the depreciation of the dollar against the Armenian dram. Moreover, Armenia’s other exporting bright spot is the IT industry, since a lot of companies and individuals work for US-based companies and get paid in US dollars. Because of the drastic change in
2156-411: Is not a separate strategy for big companies due to small market conditions. Big companies which chose applying differentiation strategies may also choose to apply in conjunction with focus strategies (either cost or differentiation). On the other hand, this is definitely an appropriate strategy for small companies especially for those wanting to avoid competition with big ones. In adopting a narrow focus,
2233-428: Is not suitable for small companies. It is more appropriate for big companies to apply differentiation in any one or several of the functional groups (finance, purchase, marketing, inventory etc.). This point is critical. For example, GE uses its finance division differentiate itself. A company may do so in isolation of other strategies or in conjunction with focus strategies (requires more initial investment). It provides
2310-460: Is static, rather than dynamic, because the purchase is a one-time event. The unlimited resources model utilizes competitors by practicing a differentiation strategy. An organization with greater resources can manage risk and sustain profits more easily than one with fewer resources. This provides a short-term advantage only. If a firm lacks the capacity for continual innovation, it will not sustain its competitive position over time. This dimension
2387-491: Is that trade barriers can make exporting uneconomical and risky. For small and medium-sized enterprises (SMEs) with fewer than 250 employees, export is generally more difficult than serving the domestic market. The lack of knowledge of trade regulations , cultural differences, different languages and foreign-exchange situations, as well as the strain of resources and staff, complicate the process. Two-thirds of SME exporters pursue only one foreign market. Another disadvantage
Export - Misplaced Pages Continue
2464-502: Is the dependency on almost unpredictable exchange rates. The depreciation of foreign currency badly affects exporters. For example, Armenia exports different things - from foodstuff to software. In 2022, the country had an enormous number of Russian visitors and tourists because of the military situation in Russia. This resulted in a change in exchange rates and the appreciation of the Armenian dram. At first, it may seem that Armenia’s economy
2541-495: Is the effect of trade liberalization on aggregate productivity. Due to the increase of the number of international business activities through a multilateral trading system, RA Government Program, which was approved in February 2019, the government policy became the objective of economic growth. The period established for the program was 2019-2024. Export quality is developed by developing the export volumes and services. Tariffs ,
2618-468: Is the third week of May. Every year the President declares that week to be World Trade Week. The trade-offs between local food production and distant food production are controversial with limited studies comparing environmental impact and scientists cautioning that regionally specific environmental impacts should be considered. A 2020 study indicated that local food crop production alone cannot meet
2695-644: Is to obtain the most extensive distribution possible. Promotional strategy often involves trying to make a virtue out of low cost product features. The third dimension is control over the value chain encompassing all functional groups (finance, supply/procurement, marketing, inventory, information technology etc..) to ensure low costs. For supply/procurement chain, this could be achieved by bulk buying to enjoy quantity discounts, squeezing suppliers on price, instituting competitive bidding for contracts, working with vendors to keep inventories low using methods such as Just-in-Time purchasing or Vendor-Managed Inventory. Wal-Mart
2772-442: Is transferred or sold from a party in one country to a party in another country is an export from the originating country, and an import to the country receiving that product. Imports and exports are accounted for in a country's current account in the balance of payments . Trading globally may give consumers and countries the opportunity to be exposed to new markets and products. Almost every kind of product can be found in
2849-483: Is unlikely to help countries and sectors to reduce these or to improve their resource self-sufficiency . A number of people in Africa , including children, were using informal or " artisanal " methods to produce gold . While millions were making a livelihood through the small-scale mining, governments of Ghana , Tanzania and Zambia complaint about the increase in illegal production and gold smuggling . Sometimes
2926-399: Is unsatisfactory, the exporting country may choose to put a tariff of its own on imports from the other country. Exporting avoids the cost of establishing manufacturing operations in the target country. Exporting may help a company achieve experience curve effects and location economies in their home country. Ownership advantages include the firm's assets , international experience, and
3003-408: The competitive scope of the business. Porter defined two types of competitive advantage : lower cost or differentiation relative to its rivals. Achieving competitive advantage results from a firm's ability to cope with the five forces better than its rivals. Porter wrote: "Achieving competitive advantage requires a firm to make a choice...about the type of competitive advantage it seeks to attain and
3080-519: The eclectic paradigm , companies with meager ownership advantages do not enter foreign markets. If the company and its products are equipped with ownership advantage and internalization advantage, they enter through low-risk modes such as exporting. Exporting requires significantly less investment than other modes, such as direct investment . Export's lower risk typically reduces the rate of return on sales versus other modes. Exporting allows managers to exercise production control, but does not provide them
3157-491: The international market , for example: food, clothes, spare parts, oil, jewellery, wine, stocks, currencies, and water. Services are also traded, such as in tourism , banking , consulting , and transportation . Advanced technology (including transportation ), globalization , industrialization , outsourcing and multinational corporations have major impacts on the international trade systems . International trade is, in principle, not different from domestic trade as
Export - Misplaced Pages Continue
3234-524: The profit impact of marketing strategy indicated that firms with a high market share were often quite profitable, but so were many firms with low market share. The least profitable firms were those with moderate market share. This was sometimes referred to as the hole in the middle problem. Porter's explanation of this is that firms with high market share were successful because they pursued a cost leadership strategy and firms with low market share were successful because they used market segmentation to focus on
3311-526: The UAE. In July 2020, a report by Swissaid highlighted that the Dubai-based precious metal refining firms, including Kaloti Jewellery International Group and Trust One Financial Services (T1FS), received most of their gold from poor African states like Sudan . The gold mines in Sudan were seldom under the militias involved in war crimes and human rights abuses . The Swissaid report also highlighted that
3388-400: The ability to develop either low-cost or differentiated products . The locational advantages of a particular market are a combination of costs, market potential and investment risk . Internationalization advantages are the benefits of retaining a core competence within the company and threading it though the value chain rather than to license , outsource , or sell it. In relation to
3465-457: The added expense to acquire the product or service but is ineffective when its uniqueness is easily replicated by its competitors. Successful brand management also results in perceived uniqueness even when the physical product is the same as competitors. This way, Chiquita was able to brand bananas, Starbucks could brand coffee, and Nike could brand sneakers. Fashion brands rely heavily on this form of image differentiation. Differentiation strategy
3542-696: The chief global strategist of International Resources Holding (IRH), Sibtein Alibhai, from the UAE approached a number of gold traffickers in Democratic Republic of Congo. The firm is a unit of IHC, which is controlled by Sheikh Tahnoun bin Zayed. In 2023, IRH acquired Zambia’s Mopani copper-cobalt complex in exchange of a commitment to put in over $ 1 billion into the mine. It was also aggressively looking for mining deals, particularly in Africa, to turn into
3619-509: The company ideally focuses on a few target markets (also called a segmentation strategy or niche strategy). These should be distinct groups with specialized needs. The choice of offering low prices or differentiated products/services should depend on the needs of the selected segment and the resources and capabilities of the firm. It is hoped that by focusing your marketing efforts on one or two narrow market segments and tailoring your marketing mix to these specialized markets, you can better meet
3696-2081: The demand for most food crops with "current production and consumption patterns" and the locations of food production at the time of the study for 72–89% of the global population and 100–km radiuses as of early 2020. Studies found that food miles are a relatively minor factor of carbon emissions, albeit increased food localization may also enable additional, more significant, environmental benefits such as recycling of energy, water, and nutrients. For specific foods regional differences in harvest seasons may make it more environmentally friendly to import from distant regions than more local production and storage or local production in greenhouses. Qualitative differences between substitutive products of different production regions may exist due to different legal requirements and quality standards or different levels of controllability by local production- and governance -systems which may have aspects of security beyond resource security, environmental protection , product quality and product design and health . The process of transforming supply as well as labor rights may differ as well. Local production has been reported to increase local employment in many cases. A 2018 study claimed that international trade can increase local employment. A 2016 study found that local employment and total labor income in both manufacturing and nonmanufacturing were negatively affected by rising exposure to imports. Local production in high-income countries, rather than distant regions may require higher wages for workers. Higher wages incentivize automation which could allow for automated workers' time to be reallocated by society and its economic mechanisms or be converted into leisure-like time. Local production may require knowledge transfer , technology transfer and may not be able to compete in efficiency initially with specialized , established industries and businesses, or in consumer demand without policy measures such as eco-tariffs . Regional differences may cause specific regions to be more suitable for
3773-552: The exchange rates, these people and companies who export their service to the US or other countries and get paid in US dollars, make around 25% less revenue. Exports could also devalue a local currency to lower export prices. It could also lead to imposition of tariffs on imported goods. The variety of export motivators can lead to selection bias. Size, knowledge of foreign markets, and unsolicited orders motivate firms to along specific dimensions (research, external, reactive). In macroeconomics , net exports (exports minus imports) are
3850-411: The fact that hybrid business strategy could exist (Porter cited by Prajogo 2007, p. 70) and writes in the following manner. Though Porter had a fundamental rationalisation in his concept about the invalidity of hybrid business strategy, the highly volatile and turbulent market conditions will not permit survival of rigid business strategies since long-term establishment will depend on the agility and
3927-440: The hub-and-spoke model of mainstream carriers, United, and American Airlines. Michael Treacy and Fred Wiersema (1993) in their book The Discipline of Market Leaders have modified Porter's three strategies to describe three basic "value disciplines" that can create customer value and provide a competitive advantage. They are operational excellence , product leadership, and customer intimacy. Several commentators have questioned
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#17327984205264004-852: The illicit gold coming into Dubai from Africa is imported in large quantities by the world's largest refinery in Switzerland , Valcambi . Another report in March 2022 revealed the contradiction between the lucrative gold trade of West African countries and the illicit dealings. Like Sudan , Democratic Republic of Congo (DRC), Ghana and other states, differences were recorded in the gold production in Mali and its trade with Dubai, UAE. The third largest gold exporter in Africa, Mali imposed taxes only on first 50kg gold exports per month, which allowed several small-scale miners to enjoy tax exemptions and smuggle gold worth millions. In 2014, Mali's gold production
4081-606: The involvement of customs authorities. For any firm, Global expansion strategies may include: Exporting is mostly a strategy used by product based companies. Many manufacturing firms begin their global expansion as exporters and only later switch to another mode for serving a foreign market. There are four main types of export barriers: motivational, informational, operational/resource-based, and knowledge. Trade barriers are laws, regulations , policy , or practices that protect domestically made products from foreign competition. While restrictive business practices sometimes have
4158-421: The legal system, and so on. Another difference between domestic and international trade is that factors of production such as capital and labor are often more mobile within a country than across countries. Thus, international trade is mostly restricted to trade in goods and services, and only to a lesser extent to trade in capital, labour, or other factors of production. Trade in goods and services can serve as
4235-399: The market grew, big airlines started to offer the same low-cost attributes, and so cost focus became cost leadership! A cost leadership strategy may have the disadvantage of lower customer loyalty, as price-sensitive customers will switch once a lower-priced substitute is available. A reputation as a cost leader may also result in a reputation for low quality, which may make it difficult for
4312-472: The market) or industry-wide, offering its product across many market segments. The generic strategy reflects the choices made regarding both the type of competitive advantage and the scope. The concept was described by Michael Porter in 1980. Porter wrote in 1980 that strategy targets either cost leadership , differentiation , or focus. These are known as Porter's three generic strategies and can be applied to any size or form of business. Porter claimed that
4389-405: The mid to late 1980s where the environments were relatively stable there was no requirement for flexibility in business strategies but survival in the rapidly changing, highly unpredictable present market contexts will require flexibility to face any contingency (Anderson 1997, Goldman et al. 1995, Pine 1993 cited by Radas 2005, p. 197). After eleven years Porter revised his thinking and accepted
4466-629: The motivation and the behavior of parties involved in a trade do not change fundamentally regardless of whether trade is across a border or not. However, in practical terms, carrying out trade at an international level is typically a more complex process than domestic trade. The main difference is that international trade is typically more costly than domestic trade. This is due to the fact that cross-border trade typically incurs additional costs such as explicit tariffs as well as explicit or implicit non-tariff barriers such as time costs (due to border delays), language and cultural differences, product safety,
4543-465: The needs of that target market. The firm typically looks to gain a competitive advantage through product innovation and/or brand marketing rather than efficiency. A focused strategy should target market segments that are less vulnerable to substitutes or where a competition is weakest to earn above-average return on investment. Examples of firms using a focus strategy include Southwest Airlines, which provides short-haul point-to-point flights in contrast to
4620-508: The number of models produced to ensure larger production runs. Overheads are kept low by paying low wages, locating premises in low rent areas, establishing a cost-conscious culture, etc. Maintaining this strategy requires a continuous search for cost reductions in all aspects of the business. This will include outsourcing, controlling production costs, increasing asset capacity utilization, and minimizing other costs including distribution, R&D and advertising. The associated distribution strategy
4697-503: The ones adopting one generic strategy. Sharing the same view point, Hill (1988 cited by Akan et al. 2006, p. 49) challenged Porter's concept regarding mutual exclusivity of low cost and differentiation strategy and further argued that successful combination of those two strategies will result in sustainable competitive advantage. As to Wright and other (1990 cited by Akan et al. 2006, p. 50) multiple business strategies are required to respond effectively to any environment condition. In
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#17327984205264774-435: The opportunity to enjoy economies of scale and large production volumes and big market share. Small businesses can be "cost focused" not "cost leaders" if they enjoy any advantages conducive to low costs. For example, a local restaurant in a low rent location can attract price-sensitive customers if it offers a limited menu, rapid table turnover and employs staff on minimum wage. Innovation of products or processes may also enable
4851-682: The option to exercise as much marketing control. An exporter enlists various intermediaries to manage marketing management and marketing activities . Exports also has effect on the Economy. Businesses export goods and services where they have a competitive advantage. This means they are better than any other country at providing that product or have a natural ability to produce either due to their climate or geographical location etc. Exporting may not be viable unless appropriate locations can be found abroad. High transport costs can make exporting uneconomical, particularly for bulk products. Another drawback
4928-426: The outbreak of COVID-19 sufficiently changed the world economy, people started doing business, so international trade is a key for economic growth. Armenia's economy is dependent on international flows, tourism, and inner production. Competitive export Industries were established which helped the growth of Gross Domestic Product (GDP) to generate financial resources. The market shifted to more efficient exporters, which
5005-682: The pattern of trade. The following table is a list of the 25 largest trading states according to the World Trade Organization in 2021 and 2022. Source: International Trade Centre In the US, the various U.S. Presidents have held observances to promote big and small companies to be more involved with the export and import of goods and services. President George W. Bush observed World Trade Week on May 18, 2001, and May 17, 2002. On May 13, 2016, President Barack Obama proclaimed May 15 through May 21, 2016, World Trade Week, 2016. On May 19, 2017, President Donald Trump proclaimed May 21 through May 27, 2017, World Trade Week, 2017. World Trade Week
5082-432: The potential for conflict between cost minimization and the additional cost of value-added differentiation. Since that time, empirical research has indicated companies pursuing both differentiation and low-cost strategies may be more successful than companies pursuing only one strategy. Some commentators have made a distinction between cost leadership, that is, low cost strategies, and best cost strategies. They claim that
5159-470: The procedure involved criminal operations and even human and environmental cost. Investigative reports based on Africa's export data revealed that gold in large quantities is smuggled out of the country through the United Arab Emirates , without any taxes being paid to the producing states. Analysis also reflected discrepancies in the amount exported from Africa and the total gold imported into
5236-453: The process of trade between countries of different economic standing in the modern era, some international economic organizations were formed, such as the World Trade Organization . These organizations work towards the facilitation and growth of international trade. Statistical services of intergovernmental and supranational organizations and governmental statistical agencies publish official statistics on international trade. A product that
5313-447: The quick responsiveness towards market and environmental conditions. Market and environmental turbulence will make drastic implications on the root establishment of a firm. If a firm's business strategy could not cope with the environmental and market contingencies, long-term survival becomes unrealistic. Diverging the strategy into different avenues with the view to exploit opportunities and avoid threats created by market conditions will be
5390-461: The scope within which it will attain it." He also wrote: "The two basic types of competitive advantage [differentiation and lower cost] combined with the scope of activities for which a firm seeks to achieve them lead to three generic strategies for achieving above average performance in an industry: cost leadership, differentiation and focus. The focus strategy has two variants, cost focus and differentiation focus." In general: The concept of choice
5467-441: The target market segment, or at least the lowest price to value ratio (price compared to what customers receive). To succeed at offering the lowest price while still achieving profitability and a high return on investment, the firm must be able to operate at a lower cost than its rivals. There are three main ways to achieve this. The first approach is achieving a high asset utilization. In service industries, this may mean for example
5544-438: The use of generic strategies claiming they lack specificity, lack flexibility, and are limiting. Porter stressed the idea that only one strategy should be adopted by a firm and failure to do so will result in “stuck in the middle” scenario. He discussed the idea that practising more than one strategy will lose the entire focus of the organization hence clear direction of the future trajectory could not be established. The argument
5621-483: The various statistical collections on international trade often differ in terms of definition (e.g. special trade vs. general trade) and coverage (reporting thresholds, inclusion of trade in services, estimates for smuggled goods and cross-border provision of illegal services). Metadata providing information on definitions and methods are often published along with the data. Porter generic strategies#Differentiation Strategy Porter's generic strategies describe how
5698-406: Was a different perspective on strategy, as the 1970s paradigm was the pursuit of market share (size and scale) influenced by the experience curve . Companies that pursued the highest market share position to achieve cost advantages fit under Porter's cost leadership generic strategy, but the concept of choice regarding differentiation and focus represented a new perspective. Empirical research on
5775-545: Was exported from Africa, and the UAE accounted for 93% of the undeclared exports. Following the Emirates, next two prime importers were Switzerland and India. Majority of the artisanal gold extracted in the 18 African countries ends up in the Emirates. As per Swiss regulations, gold’s place of origin is usually where it is last refined, because of which smuggled gold linked to conflicts and human rights violations legally enters Switzerland. A United Nations report revealed that
5852-403: Was increased when a country hosted a network of immigrants, but the trade effect was weakened when the immigrants became assimilated into their new country. The history of international trade chronicles notable events that have affected trading among various economies. There are several models that seek to explain the factors behind international trade, the welfare consequences of trade and
5929-404: Was of 45.8 tonnes, while the UAE's gold import were at 59.9 tonnes. In May 2024, a report released by Swissaid revealed that the prime recipient of tens of billions of dollars of smuggled African gold each year had been the UAE. Between the 2012 and 2022, 2596 tonnes of gold undeclared was exported out of Africa to the UAE. In 2022 alone, 435 tonnes (worth about $ 31 billion) of gold not declared
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