YW

Learning Objectives

  • Understand rapid changes in the global marketplace

  • Learn reasons businesses expand internationally

  • Explore political/economic interconnectivity affecting global trade

  • Recognize macro-level trends impacting future global markets

  • Discover fundamental processes of international trade development

  • Identify challenges of global expansion for managers

Our Changing World

  • Growth in Asia, Eastern Europe, Middle East, South America

  • Increased demand for Canadian natural resources

  • Canadian manufacturing faces cost competitiveness challenges

  • Shift from North America-centric to global-centric market views

  • Rise of BRIC economies benefiting from FDI and competitive business models

The Global Marketplace

  • Major global businesses exceed GDP of many countries

  • Increasing competition from developing countries

  • Expansion of small/medium businesses beyond local borders

Case Studies: Lululemon and Couche-Tard

  • Lululemon: Started in 1998 as a yoga clothing retailer, leveraging community feedback and innovative design for growth.

  • Couche-Tard: Transformed from a small convenience store to a global player via acquisitions and strategic alliances.

Strategies for Global Expansion

  • Strategic alliances: Less complex collaboration while retaining independence.

  • Mergers: Complete uniting of two companies into a new entity.

Key Reasons to Go Global

  • New market opportunities: Expansion into less saturated markets.

  • Cost reduction: Accessing lower labor costs and high skill levels abroad.

  • Resource base control: Securing vital resources for operations.

  • Closeness to markets: Better responsiveness to local market demands.

  • Economies of scale: Cost efficiencies through larger operational scopes.

International Trade Concepts

  • Specialization: Efficient production across countries through specialization.

  • Role of WTO: Ensure smooth, fair trade; over 159 members representing 97% of world trade.

  • Role of IMF: Short-term loans, monitoring economic developments.

Global Market Stability

  • Importance of government in trade: Advocating for market openness and protectionism absence.

  • Criteria for successful trade: Intellectual property law enforcement, labor practices, environmental standards.

G8 vs. G20

  • G8: Established economies with significant global trade influence.

  • G20: Emerging economies representing future growth in global trade.

Challenges in Managing Globally

  • Require effective production and logistical systems.

  • Need comprehensive risk assessment (financial, political, etc.).