BU111 - Exam

Canadian Population

40 Million 

Life expectancy

83 Years

Median age

40.8 years

People per household

2.5 years

Median household income

$61,400

Smartphone penetration

86%

Online shopping

28.1million people

Urban area

81%

Big 6 Cities

Toronto Montreal Calgary Ottawa Edmonton Vancouver

Market Segmentation

15-20% low end

60-65% average

15-20% high end

Under age 15

cohort size 16%

15-19 age

cohort size 6%

20-25 age

cohort size 7%

25-40 age

cohort size 21%

40-65 age

cohort size 33%

Over 65 age

cohort size 17%

What is population? What drives it (insights)? How is it applicable?

# of people in an area

Answer driven by population in area ie stores

Market size/share, revenue, profitability, supply needed, saturation, competition

What is when you break a probably down on an individual level? What drives it (insights)? How is it applicable?

Anything consumed at an individual level

Calculate individual consumables/demand ie phone

Market size/share, revenue, profitability

What is it when you break a problem down on an household level? What drives it (insights)? How is it applicable?

Things used as a group

Calculate group consumables/demand ie refrigerator, hose, roof

Market size/share, revenue, profitability

What is when you break a probably using a proxy? What drives it (insights)? How is it applicable?

*Biggest driver of estimate or easiest variable to observe

Number of stores in an area; population/store

Ie. stores, gas pumps

Company revenue/profitability, market size, supply, saturation of market

TAM

TAM - Total Addressable Market

Entire market for your product

100% share

Restaurants

SAM

SAM - Serviceable Available Market

Size of your segment (target)

Italian Restaurants

SOM

SOM - Serviceable obtainable Market

Your share: how much of segment you can win

Waterloo area

How do you break a problem down into market frequency approach (the equation)

Population (household or individual)

Defining characteristics of the population = % of pop

X purchase frequency

X Purchase quantity

X Unit cost

Social Factors break down into 4 main elements and why is it important?

Customs

Habits

Values/attitudes

Demographic characteristics

These are all important as they affect customer preferences and worker attitudes and behavior, standards of business conduct and corporate social responsibility

Demographics

the study of human population, cohorts = homogeneous groups within the larger population

• Powerful predictor of behaviors/trends

• Certainty and simplicity of age data

• Predicts supply and demand and informs environment analysis and human resource decisions

What are the advantages of a smaller cohort group?

Less people, less variation

Less competition (compete to get a job. Fill the millennials)

What are advantages and disadvantages of large cohort groups?

Disadvantage of large cohorts

• More competition

  Advantage of large cohorts

• Large market will be targeted more often

• Influence on business/government/media

• Will make choice in favour of majority group

• Currently millennials are the largest cohort

Canadian Population Distribution 

1) Labour force

2) Economy

3) Market

4) Implications 

5) Immigrants?

6) Implications of immigrants

1) → fewer incoming than outgoing

2) → fewer supporting pensions 

3) → children of boomers = relatively large group

4) Eco has greater market impact, Vulnerable seniors - demand for care, Increasing strain on pension and healthcare, Potential labour shortages  

5) Increase number of immigrants - younger and more likely to live in city than average Canadian

6) Many consumers having difficulty interacting with marketplace, Immigrants may not have the same skil lset,Creates opportunities, Diverse workforce able to serve multiple different consumers, More likely to live in more civil/rural areas, More opportunities, More well known  

What is a Cohort 

Number of people in each age group

Impacted by fertility rate, birth rate

What are the aging boomers and their implications

• Baby boomers 1946-64 - larger cohort

• Now the aging population creates opportunity → increased need for retirement homes, care, etc. 

• Implications/Challenges include increased elder care, sandwiched generation (people have to take care of their parents and kids), increased vulnerable seniors 

• As Boomers age, shortage of employees to fill their jobs → impacting the economy 

  • Immigration will be necessary to sustain the economy 

How are Canadian households changing? and what are the implications?

• One-person households greater than one-family households 

• Decreasing over time 

• One-person households are increasing over time 

  • Lower birth rates, higher costs associated with having a family, divorce rates are increasing, aging population, women live longer than men 

• Implications

  • Lost economies of scale in living, shopping 

  • Families face time constraints

    • They are busy - focusing on convenience 

    • Must focus on needs - less shopping on non essentials  

  • One-person homes are less likely to use things such as Costco 

  • Only one person contribute to costs of household 

Population Living in Rural Areas of Canada 

• Shrinking rural communities 

• Rural living predominates in Atlantic Canada, Saskatchewan, Territories 

• Most provinces less and less are living in rural communities

• More people are living in bigger cities and areas around them

• Now we are starting to see the donut effect

  • The hole is the city

  • Most people can't afford to live in the city, but vast majority live in the suburbs surrounding the city

who is moving and why?

• Family moving to urban areas - more space

• More affordable housing is in the outskirts

• Job opportunities

what are the challenges and implications of people moving to urban areas?

• As people in rural areas move (the younger generation) this leaves majority of rural areas to be the aging population

  • Results in fewer people to fill jobs in these areas

• Employees have to think how to get people to get jobs, but also have to think about how/why potential customers may be leaving

  • What they can do:

    • Any sort of incentive to keep people (something like healthcare benefits)

    • Expand market (move things online)

    • Allow people to work online

What are the four factors that influence demogrpahics?

Economics, technology, world events/news, parenting.

What is the characteristic, implication and an example of the demographic factor economics?

Values and priorities - how/time you were raised will impact your values on things such as money

How to attract, retain, motivate

People raised in the great depression are more frugal with their money

What is the characteristic, implication and an example of the demographic factor technology?

Lifestyle

What makes a product appealing

What is the characteristic, implication and an example of the demographic factor world events/news?

Habits (digital and other) - How do events impact people's

How to attract as consumers

9/11

What is the characteristic, implication and an example of the demographic factor parenting?

Mindset - How a person is raised impacts their mindset

How much they spend and what they spend on

Baby Boomers (1946-64) and their consumer/work implications

• Prefer in person transactions

• Long hours in office

• 1 carrer and company

Gen X (1965-79) and their consumer/work implications

• Research online but buy in person 

• Brand loyal 

• Flexible work 

• Perfect career

Gen Y/Millennials (1980-94) and their consumer/work implications

• Digitally savvy 

• Quality>brand

• What authenticity 

• Customization and personalization, experiences vs assets 

• access>ownership 

• <socially minded

• Meaningful, flexible, work-life balance 

• Will change jobs

Gen Z (1995-) and their consumer/work implications

• Digitally savvy

• <value uniqueness

• + want to “know” brand 

• Customization and personalization, experiences vs assets 

• Frugal/avoid debt

• <socially minded

• Meaningful, flexible, work-life balance 

• Several careers

How do the different cohorts work as employees?

• Boomers willing to spend a large amount of time at a company/in the office

• Gen-x may switch companies, but stay on the perfect career path

• Millennials will switch job, industry, but around the same type of job

• Gen-z expected to have multiple careers

What is market penetration

• Sell more of existing product to existing target market

• = greater market share and/or greater purchase frequency

Why would a company use a market penetration strategy?

• build on what you have and know -no change, economies of scale in production and selling

• Least risky → More of the same - want customers to buy more 

  • Either buy more at once 

  • Or buy more consistently 

• Pretty much a no brainer - always trying to sell more

• Try new tactics to make this a reality

• If producing more this will decrease costs, as you can buy in bigger bulks, will likely get discounts, economies of scale will come into play 

What are the challenges with market penetration?

• competitor reaction, winning customers

• Competitive reaction

• You can try, doesn't mean it will work

• Comp may try to retaliate, eg. Under cut your price

• Requires work to convince customers to buy more 

What are tactics for market penetration?

• Cut prices

• Increase advertising, loyalty schemes -hopefully persuasive, Eg. buy 1 get 1 50% off from Starbucks for members 

• Increase distribution channels - Eg. McDonalds partner w uber eats

  • Easier for customers to access McDonalds

  • Leads to increase in volume/purchase frequency of the product 

• Volume incentives - 2 loafs of bread for $6

• Buy a competitor

what questions should a company ask when taking on a market penetration strategy?

• Return: If I decrease price will volume compensate for lower price?  Will lower price affect brand image?

  • Can you sell enough in volume that sales will be equal to or more then if you kept the price the same - Move to try and drive volume transactions

  • Challenges - luxury brand items

    • No sales, Won't sacrifice the brand reputation  

• Diamond-E

  • Capabilities: Can I persuade customers to consume more of my product?

  • Resources: Do I have to use new distribution channels? Should I? Can I?

  • Resources: Do I have the production capacity to meet the increased demand?

• Porter’s insights:

  • Buyers: Propensity to switch? Lock in/switching costs? Brand loyalty?

    • Are buyers already locked in? Are they brand loyal to us, willing to buy more?

  • Rivalry: Fragmented vs concentrated, growing vs declining, aggressive vs passive competitor 

    • How will comp react? If market is concentrated and aggressive, it will be much more challenging to steal market share from them

  • How much share do I already have? Can it grow?

What is market development?

Same product, new customer 

• Selling what you already produce to new target markets (market segments) or new geographic markets

  • Thinking about the questions of expansion

why would you choose a market development strategy?

• Capitalize on production capabilities, economies of scale, pursue less contested or larger market; diversification of customer base 

• Economies of scale - ramping up volume → By increasing customer base

• Diversification strategy → Diversify customer base 

What is the challenge of market development?

customer access and awareness →  Understand the new market

What are tactics for market development?

• Create awareness in new market – pitch benefits to new customers

  • Ads - awareness

• Expand geographically (use international expansion knowledge!)

  • Determine how you will expand internationally → Will you get an agent? Etc. 

what questions should you ask when thinking about using a market development strategy?

• Diamond-E:

  • Resources: Will this affect brand image? Should I use  a different brand name?

    • Eg. When you expand to another country the people hate it and start posting about it on tik tok

      • Big companies will use different names so that they can adapt to local market and also protect themselves of brand impact if one market doesn't end up liking the product

      • Eg. Procter and gamble -  Gain VS Tyde 

  • Capabilities: Will the product need any adjustments? Can I make them?

    • Eg. McDonalds adapting menu to the location 

  • Do I have the resources ($, brand equity, distribution network, knowledge of new customer) and capabilities (marketing, product redesign, international operations) to go international?

    • Depends on how you choose to execute the strategy

    • Can be super high or lower depending 

• Porter’s:

  • Can I access the distribution channels to reach this new market?

  • Are the customers accessible? Will they switch?

  • Rivalry: fragmentation, aggression, growth? Differentiation – are there market segments that are under-served?

  • Barriers to entry?

What is product development?

New product, Same Customer 

• Develop related or unrelated products your customers value; product line extension

• Similar risk factor as market development 

What is the benefit of product development?

• build on customer knowledge & brand equity; possible distribution synergies & product complementarity/bundling

• Already know  about customers and can see a gap that can be filled

• Can use the loyalty they have for one product and leverage this so they are loyal to a new product 

what are the challenges of product development?

• cannibalization 

  • If you are coke and make coke 0, Will people just buy coke 0 only and sales plumet for coke. Leading to no overall growth

  • Be mindful they don't switch from your one product to the next 

• give up production efficiencies; must know what and how to develop new product

  • Not just focused on one product 

what tactics should you use for product development?

• Extend product

• Repackage existing products

• Create bundles of complementary products that add value to each other

What questions should you as when looking at using a product development strategy?

• Diamond-E:

  • Can I leverage existing brand and/or distribution? 

  • Can my facilities manage or do I have to build new ones?

  • Can I produce & sell at a profitable scale? Will you still be able to?

  • How much new product expertise will I need?

• Porter’s:

  • Will customers be willing to switch to my new product? 

  • Rivalry: aggression?

  • Barriers to entry?

What is a diversification strategy?

New products and markets 

• Chasing new customers with new products; creating new businesses

  • Concentric/horizontal → Less risk

    • Expanding into a product or market that is related to your existing

      • If you sell lawn mowers but then start making snow blowers

        • Similar items, but customers may not be the same

  • Vertical → Less risk 

    • Talking about the supply chain.

    • Porters - backward and forward integration

    • Eg. Toyota makes cars, does backward integration and makes tires

      • Go backwards in the supply chain

      • Runs car and tire manufacturing companies

    • Eg. Virgin Records producing CDs and Records

      • Sold them to stores

      • Forward integration and made their own store

      • Became their own distributer       

  • Conglomerate → Risker 

    • Completely unrelated business lines

    • Eg. General electric

      • Makes lightbulbs but also has a bank

      • Bought companies that were underperforming and fixed it

    • Eg. Samsung sells computers but also sells washers and dryers and refrigerators

What are the benefits of a diversification strategy?

• diversify business portfolio by building new business

  • If the economy starts to tank and doesn't want to buy new TVs but still need a washer/dryer

• capitalize on existing capabilities in higher growth areas

• May have support amongst different business lines

  • Eg. President of Samsung phones, president of Samsung washers

  • If there is efficiency in the phones they can use these learnings and scale across the difference business 

what are the challenges of a diversification strategy?

• many activities and capabilities must be created or changed = high risk of failure

• Spreading recourses thin - easy to loose focus on one line when spending focus on another

what are the tactics of a diversification strategy?

• Acquire other business → Buy and rebrand already existing businesses 

• Use joint ventures and alliances

  • If expanding internationally - joint venture

    • Can help reduce risk

    • Not just your capital on the line

What questions should you ask when thinking about a diversification strategy?

• Will this affect brand image? 

  • If you don't make you next product as good, your brand reputation may be tarnished 

• Diamond-E:

  • What new capabilities and resources will I need? Can I build or buy them?

    • Need a lot to have a lot of financial recourses 

  • How much will I have to change operations? HR? Structure?

    • How do you ensure communication structure

      • Will have to adapt as you bring in new lines

• Porter’s:

  • Can I access the distribution channels to reach this new market?

  • Are the customers accessible? Will they switch?

  • Rivalry: fragmentation, aggression, industry growth?

  • Barriers to entry?

What are the 3C’s and 1P you should think about in each quadrant of the anstrofx matrix?

• Understand your company

  • Capacity, market understanding, production flexibility, brand equity, market share

• Understand the customer

  • Segments-size, growth, profile, channel preference, value definition 

• Understand the competition

  • Position (target markets and market gaps), pricing, distribution, barriers, size, share, offerings 

• Understand the product

  • Differentiation, substitutes, ”job”, need for adjustments

What are the four foreign entry tactical strategies?

What should you ask when looking at sale volume criteria for any of the foreign entry strategy?

Large sales expected abroad? Extra capacity at home?

What should you ask when looking at customer knowledge criteria for any of the foreign entry strategy?

Understand what they want and how to sell to them?

What should you ask when looking at trade barriers criteria for any of the foreign entry strategy?

Know, can and have time to navigate the bureaucracy? Will tariffs make you uncompetitive?

What should you ask when looking at Financial, hr, IP resources criteria for any of the foreign entry strategy?

What capacity and knowledge does your hr have? Do you have the money to commit to a more expensive strategy? Are you concerned about IP? Do you have valuable IP?

What should you ask when looking at Market knowledge & network criteria for any of the foreign entry strategy?

How well do you understand the foreign market (customer and doing business)? Do you have existing or easily accessible distribution and/or supplier relationships?

What should you ask when looking at Mgmt capability criteria for any of the foreign entry strategy?

Do you have the capacity to manage a foreign operation? Do you have the knowledge to manage a foreign operation?

What should you ask when looking at risk tolerance criteria for any of the foreign entry strategy?

Do you prefer to enter carefully, test, learn and expand or do you want to enter assertively to capture market quickly and significantly?

What are the elements of political factors ?

• Laws, regulations - How does this impact a business

• Taxes

• Trade agreements or conditions

  • Important 

  • To help facilitate ease into expanding to other countries 

    • Is there already trade agreements 

    • Are the countries on good terms 

  • Could lead to more competitors entering the market 

What are is the significance of the elements of political factors?

• Protection of consumers; ethical business; financial and physical safety

  • So businesses can't take a ton of shortcuts to employees and customers that would put them in a dangerous position 

• Support/ protection and regulation of domestic businesses; fair competition; entrepreneurship

• Opportunity creation in foreign markets

• Government wants to make jurisdiction competitive to have lots of companies want to set up 

How does Business influence government?

1. Lobbying 

   • A way to get government to enact/change a legislation 

   • Lobbying Act - Lobbyers must be registered and follow specific rules 

   • There to plead their case 

   • Hired to represent company’s/group interes

   • Many times there is opposing sides of lobbyers

   • Trade associations - pool together a big group of people - representing members and their interests to government (example Ontario university lobbyers) 

2. Collaberationg/Input 

   • CRTC consoults with industry members

3. Advertising - Corporations influence voters 

   • In Ontario and Canada 

     • More and more restrictions on political advertising 

   • Previously companies (third party organizations) would spend a ton of money on advertising that was negative political advertising 

     • Would help all the other political parties 

     • Trying to influence public votes

     • Companies would do this so they could get the policies they want for their company

   • Created grey area 

   • Now more tighter regulations that businesses can have when it comes to advertising   

How does government impact business, state the role, approach and impact.

Role	Approach	Impact
Service Provider	Delivery, teaching	Competition, social goals
Business Supports	Subsidies, trade agreements	Opportunity, protection
Laws, Regulations	Competition, consumer, pollution laws, IP rights	Competion, consumer, protection, innovation, social goals, barriers
Taxation	Income (Business and personal), Sales, Property Restrictive	Customer spending, incentives, barriers

What are examples of service providers and what do they do?

• Class rooms

• Meet societal goals

• Educated workforce

• Roads

• Mail delivery - seen as a service and competition (to UPS, Fed Ex, etc.)

  • Government act as a competitor to other businesses in society

In order to be a service provider the government must act as…

a customer to businesses

• Buy the desks, and other supplies for schools

• Buy the Vans for the mailman

• Buy the equipment to make the roads

How does the government support business through subsidies?

• Subsidies - Incentives

  • Example: give money to company's investing in green energy

  • Example: during the pandemic, government would pay up to 75% of their employees wages up to a certain number

    • Huge support to businesses

How does the government support businesses through trade agreements?

• Trade agreements - importance of having relations with other countries to allow for expansion opportunities

  • Joe Biden seen as protectionism

    • Inflation reduction act passed in the USA

      • Gave huge subsidies to American base companies - gave money to customers money for buying electric cars that were American made

      • Canadian companies competing in the USA would have large challenges to compete

How does the government help businesses through laws and regulations?

• One of the biggest approaches - competition act

  • In Canada we try to encourage the markets to drive the cost

  • As many competitors

    • The more the choice, the better the quality, and price

    • Forces businesses to compete

  • There to protect the consumer

  • Laws to protect the environment

  • Intellectual property rights

    • Patents, trade marks, copyrights

    • A way to protect innovation - and allow for establishment in the market

    • As well help inspire to build upon innovation and expand on the idea as the patent will expire

How does the government use taxation?

• Income tax - taxed on income

• Sales tax - GHT

• Property tax - paid to the region

  • Funds policing, transit, sewers, garbage

• Restrictive tax

  • Example cigarettes, alcohol, cannabis 

  • Impacts consumer spending

  • Create incentives - climate action incentive, taxed on carbon tax        

Connect the role governments play to porters five forces.

Customers

• Large customer - high bargaining power

• Able to demand a lower price

 Competitor

• Compete as a rival in your industry

 Role on government - Regulator ( Laws)

• Potential entrants can be high if low regulation

• Potential entrants can be low if lots of regulation

 Taxation

• Industry where customers are taxed higher can impact the quantity

 Provider of essential services

• Substitutions - public transportation

 Provider of incentives and assistance 

• Threat of new entry - supports start-ups

Compare sole proprietorship and partnership

Characteristic	Sole Proprietorship (1)	Partnership (2 + owners)
Ease of formation
Regulations
Control over profits and decisions
Resources & capabilities
Taxation*
Liability

Characteristic	Sole Proprietorship (1)	Partnership (2 + owners)
Ease of formation	Simple; inexpensive	Simple; inexpensive; optional partner agreement
Regulations	Few As a form of ownership - you can do a lot of what you want  Full control on decision making (sole proprietorship), partnership (less control)
Control over profits and decisions	Complete	Shared
Resources & capabilities	Whatever owner brings	Slightly more; more partners = more resources
Taxation*	Taxed as personal income (advantage if business has losses)	Same but shared amounts
Liability	Unlimited	Unlimited except if limited partner*

What is an advantage if you have a sole proprietorship while having another job?

• If the business losses money - you can deduct it from the salary currently being made

  • Allows for a reduction in what you have to pay for the government

  • As you are taxed less 

• Example:

  ​​

  • Brandon can deduct his loss of $15000 in his bakery from his $60 000 salary as a prof and only be taxed on the $45 000

  • Only beneficial if you have a second income or else you just loose $15 000

What are the types of partnerships?

• General 

  • Must have at least one general partner in your partnership 

    • This person has unlimited liability, actively manages day to day operations, makes these decisions as they have the greatest impact on them 

  • All partners have joint and several liability

    • joint liability – together share liability → Bank can go after both of you

    • several liability – 1 may be liable for all → Bank can go after whoever is the easiest and has the money 

      • Example if your partner flees the country you pay it all 

• Limited 

  • limited partners liability = investment

  • limited partners cannot be active in management

  • at least one general partner

  • They can only go after your business assets, not personal assets 

    • Less liable 

  • Do not participate in day to day operations → Provide initial capital investment, Strategic decisions

Tell me about corperations

• Seperate entity from the owners (bank cannot come after personal assets) 

• Crown corporation → owend by the crown (government of Canada) i.e. Canada Post

• Public corporation → starts with IPO 

• Private corporation 

Compare Private Corporation VS Sole Propritership 

Characteristic	Sole Proprietorship (1)	Private corporation (1-49)
Ease of formation
Regulations
Control over profits and decisions
Resources & capabilities
Taxation
Liability

Characteristic	Sole Proprietorship (1)	Private corporation (1-49)
Ease of formation	Simple; inexpensive	Slightly more; still straightforward
Regulations	Few	Slightly more but still simple
Control over profits and decisions	Complete	Shared with other shareholders
Resources & capabilities	Whatever owner brings	Whatever owners bring
Taxation	Taxed as personal income (advantage if business has losses)	Taxed separately from shareholders; lower than personal income tax rates Once you are taxed if you choose to take the after tax profits and issue them back to shareholders as a form of a dividend - the shareholders dividend can be taxed (however there is a tax credit on a portion of the dividends)   This is called double taxation
Liability	Unlimited	Limited to investment except personal assets brought into business

Compare private vs public corporation

Characteristic	Private corporation (1-49)	Public corporation (unlimited)
Ease of formation
Regulations
Control over profits and decisions
Resources & capabilities
Taxation
Liability

Characteristic	Private corporation (1-49)	Public corporation (unlimited)
Ease of formation	Straightforward; relatively inexpensive	Expensive; complicated
Regulations	Relatively few; simple	Many Examples:  Audited financial statements To protect the public and make sure there are no issues of fraud that would lead the company to misrepresent what is going on
Control over profits and decisions	Shared with other shareholders	Board of Directors; less control The more shares you sell, the more money you can raise
Resources & capabilities	Whatever owners bring	Can afford to buy them
Taxation	Private corporate rates	Taxed separately from shareholders;  Slightly higher than private Lower then sole proprietorship
Liability	Limited to investment except personal assets brought into business	Limited to investment

What is a social enterprise?

Hybrid between traditional for-profit businesses and non for profit

What are the key facets of a social enterprise

• Help overcome market inequities/failures

  • Inefficient allocation of resources; markets don’t address all societal needs

  • Often in areas of education, health, environment, food insecurity, poverty

  • Looking to solve some of the worlds wicked problems 

  • Usually focus in on trying to address the UN sustainable development goals

• Social value is the primary objective BUT financial sustainability imperative

  • Donor and government funding not reliable

  • Look to create a sustainable business model that allows their profit to fund their social goal, but their end goal is finically motivated

  • Implications:

    • Economic value not required priority

    • Dual stakeholders – those served & those supporting; one or both pay

Example of a social enterprise

• Grameen Bank – providing (micro-credit) loans to women in impoverished areas of rural Bangladesh

• Wicked problem: poverty, no access to reasonable small loans

• Social Value: women start business; able to invest in children’s education, building their own homes etc.

• Self-sustaining: loans are repaid, capital given to others

• Form: not-for profit

• Constraint: no collateral

• For-profit + Social Enterprise Partnership

what are the similarities and differences of a social enterprise and traditional entrepreneurship

	Traditonal Entreprentuer	Socail Entrepenurship
Value definition and financial priority	Generate revenue, Financial ROI; finance is primary	Not about maximizing the profits, about making enough to sustain itself; social ROI
Social Benefit Focus	Secondary	Primary
Who they serve/stake holders	Paying customers  Share holders/investors	Community/whoever is receiving the social benefit (beneficiary)
Organizational form	For profit focused	Various forms - eg. Non for profit works with profit

What do the differences mean for how you run the two businesses (social and traditional enterprise)?

• Managerial preference, how and what you run your business will be impacted by the way you choose to run it 

The world has become a …. system

interdependent

What are the driving forces of globalization

1. Cost and market benefit

2. tech makes it easier, faster, cheaper 

• If looking to grow and expand - international markets may have bigger opportunities

• The ability to offshore manufacturing can create lower cost

  3. Competitive pressure

• If all of the competition is growing or doing something

• Have to adapt to compete

• Be aware of their doing and take advantage of what they aren't

  • Example: if they are only focused on international, you may focus on the local market

What are considerations of globalization

• Should we do it

• Barriers might encounter

• Strategies to overcome these barriers 

What are the internal factors you should identify when expanding internationally?

Internal Factors: Knowledge/  capabilities, Production, Preference, Finances

• Look at if you have the recourses and capabilities to make it happen 

• Do you have the recourses and capacity-  human and financial?