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Question 23 (a) Describe ONE social or cultural influence that managers should consider when conducting business with overseas clients - HSC - SSCE Business Studies - Question 23 - 2009 - Paper 1
Question 23
Question 23 (a) Describe ONE social or cultural influence that managers should consider when conducting business with overseas clients. (b) Analyse the impact of T... show full transcript
Worked Solution & Example Answer:Question 23 (a) Describe ONE social or cultural influence that managers should consider when conducting business with overseas clients - HSC - SSCE Business Studies - Question 23 - 2009 - Paper 1
Step 1
Describe ONE social or cultural influence that managers should consider when conducting business with overseas clients.
Answer
One significant social or cultural influence that managers should consider is the concept of 'power distance'. This refers to the extent to which less powerful members of a society defer to more powerful members. In countries with high power distance, such as many Asian societies, managers should be aware that hierarchical structures are respected and expected. This means that communication should be formal and relationship-building should occur at a level that acknowledges this hierarchy.
Step 2
Analyse the impact of TWO financial influences on a business wishing to export.
Answer
The first financial influence is exchange rates. A fluctuation in exchange rates can significantly impact the profitability of exports. When the domestic currency strengthens against foreign currencies, products become more expensive for overseas buyers, potentially reducing sales.
The second financial influence is access to capital. A business wishing to export may require funding to cover costs associated with production, shipping, and marketing. Limited access to capital can hinder a company's ability to scale operations and successfully enter foreign markets, limiting their competitive edge.