Notes, summaries, assignments, exams, and problems for Economy

Corporate External Growth Strategies

Economic Conditions

Labor shortages

Lack of market growth

Vertical Growth

Achieved by taking over a function previously provided by a supplier or distributor.

Horizontal Integration

The degree to which a firm operates in multiple geographic locations at the same point in an industry’s value chain.

Vertical Integration

The degree to which a firm operates vertically in multiple locations on an industry’s value chain, from extracting raw materials to manufacturing to retailing.

Forward Integration

Assuming a function previously provided by a distributor.

Backward Integration

Assuming a function previously provided by a supplier.

Horizontal Growth

Expansion of operations into other geographic locations and/or increasing... Continue reading "Corporate Growth & Stability Strategies" »

International vs. Domestic Marketing

International Marketing is the process of planning and executing transactions across national borders to create exchanges that satisfy individuals and organizations. It includes exports, imports, licensing, joint ventures, subsidiaries, and management contracts.

Domestic Marketing focuses on the supply and demand of goods and services within a single country. Businesses expand internationally due to limited domestic market size and growth.

Key Differences

International Marketing: Operates products, services, promotions, pricing, and distribution in multiple countries.

Domestic Marketing: Operates products, services, promotions, pricing, and distribution in a single country.

International Marketing Strategic Plan

Developing Forecasts

• Quantitative forecasts: Typically based on historical data or tests and often involve complex statistical computations
• Exchange Qualitative forecasts: Based on intuitive judgements

Establish Goals and Objectives

• Goals: A broad, long-range target or aim
• Objective: Specific, short-range target or aim

Establishing goals and objectives

Specific-> Measurable-> Attainable-> Relevant-> Time limited

Art and Science of Marketing

Marketing in a Changing World

• The process of creating value for customers and building relationships with those customers in order to capture value back from them

The Role of Marketing in Society

• Needs: Differences between a person's actual state and his or her ideal state; they provide the basis motivation

1. Backward Integration

   Assuming a function previously provided by a supplier.

2. Bankruptcy

   A company gives up management of the firm to the court.

3. Competitive Strategies

   Cost leadership, differentiation, and focus.

4. Concentric Diversification

   Growth into a related industry with a strong competitive position.

5. Conglomerate Diversification

   Diversifying into an industry unrelated to its current one.

6. Cooperative Strategies

   The direction of the firm as a whole and the management of its business or product.

7. Corporate External Growth Strategies

   Funds to purchase other companies.

8. Defensive Tactics

   Takes place in the firm’s own current market position as a defense against rivals.

9. Economies of Scale

   Cost falls as the company benefits at a higher level.

10. Executive

Antitrust Law: Article 101 and 102

Antitrust law, also known as competition law, addresses anticompetitive behavior through Article 101, which prohibits anticompetitive agreements, and Article 102, which prohibits the abuse of a dominant position.

Market Structures

Monopoly: Characterized by a single agent, heterogeneous products, and significant barriers to entry, which can be legal, natural, or artificial.

Oligopoly: Involves a few agents with substantial market power, heterogeneous products, and barriers to entry that are either artificial or natural.

Monopolistic Competition: Features many agents offering differentiated products.

Perfect Competition: Consists of a large number of agents, homogeneous products, no barriers to entry, and no individual... Continue reading "Antitrust Law: Market Structures and EU Single Market" »

Human Resource Management (HRM)

HRM is a management function with a specific focus on people. It's not an exact science, as human behavior can be unpredictable. The primary goal of HRM is to guide individual and group behavior by considering both individual characteristics and the environment.

Individual Characteristics

• Personality: This is largely unchangeable and influences how individuals interact with others and their work.
• Motivation: This is complex and influenced by both internal and external factors, such as salary. HRM plays a crucial role in maintaining employee motivation, as it directly impacts performance.
• Competence: This encompasses knowledge (acquired through education and training), abilities (inherent skills), and experience (gained

Global Segmentation:

Sub-set of a market = close match between specific products and customers.

1. Determination of Basic Market:

Reasons to buy (They make my customers see my brand as something important) and geographic location.

2. Identification of the Target Market:

Industrial, intermediate, and final consumer market. Business to business: doesn’t have any contact with the final consumer.

3. Industrial Market:

• Product application: Only using it for the process (When only the company is going to be using my products and to not have contact with the final consumer).
• End-Use Product: Whatever is going to be selling is going to be seen by the final consumer.
• Size of order: How much is going to be buying.
• Frequency of purchase.

Intermediate (Distribution

Set B) The Scope of Marketing: Kotler's 10 Entities

The scope of marketing addresses the question, 'What is marketed?' According to Philip Kotler, marketing professionals are involved with ten types of entities:

1. Goods

Physical goods constitute the major part of a country's production and marketing efforts. Companies market billions of food products and millions of cars, refrigerators, televisions, and machines.

2. Services

As economies advance, a large proportion of their activities focus on the production of services. Services include the work of airlines, hotels, car rental firms, beauticians, software programmers, management consultants, and so on.

3. Events

Marketers promote time-based events. Events can be trade shows, company anniversaries,... Continue reading "10 Entities in Marketing: Kotler's Perspective" »

Understanding Key Financial Concepts

Core Financial Statements Defined

Financial Statement

A financial statement is a report prepared to summarize the changes resulting from business transactions that occur during an accounting period.

Income Statement

An Income Statement is a report of the net income or net loss for a specific period.

Statement of Changes in Owner's Equity

The Statement of Changes in Owner's Equity is a financial statement that summarizes changes in the owner’s capital account as a result of business transactions during the period.

Balance Sheet

A Balance Sheet is a report of the balances in the permanent accounts on a specific date.

Report Form (Balance Sheet Format)

The Report Form is a balance sheet format that lists classifications... Continue reading "Essential Financial Statements and Accounting Terms" »