There are quite a number of demographic factors that may influence trade activities in the USA. Immigration has led to the increase in population thus this automatically increases the market base for goods. A highly literate population has a good sense of taste for trendy fashion. The USA literacy level is high therefore this encourages the development of goods and services the best suits this kind of populations needs.
There population of the USA is gradually growing with the large part of this population being workers. When there is a higher number of the working population in relation to the non workers, the economy experiences some positive growth. With this kind of growth, luxury items become more affordable to the population (Lewis 31 ). Therefore having an introduction of scented toilet paper will be most welcome. Due to the low mortality rate and gradual population growth in America, there is an ever growing demand for goods and service and the need for diversity amongst the population.
The introduction of a new product is seen to be a good strategy to counter the growing demand for goods. A large population in USA lives in the urban areas where luxury is seen as a necessity and trendy. Therefore scented toilet paper will have an edge over the rest of the toilet papers that are in this market. With a positively growing economy, there is economic empowerment of the population which increases their buying capacity.
Traditional beliefs, customs and cultural inclinations also have a bearing on the trend of buying and selling in an economy (Menger 100). Culture has a big effect on international cooperation and the norms and diverse values encompassed by culture alter negotiations. In the USA, there is this culture where there is an expectation for competition in aspect of life. However, everyone expects to be given an equal ground for this competition. With this in mind, we realize that we will have a fair ground in competing with the products that are already available in this market. The people of this nation also believe in getting the best for themselves. Therefore, an introduction of a product that has an extra feature will definitely have an edge over the rest of the products in the market.
The social institutions, for example the church, media, education, political structure, family or labor organizations have a great impact on the business culture. These institutions have set out guiding principle in the manner in which business is conducted. For instance, there are church beliefs that bar believers from buying certain items. Some churches do not allow the purchase and use of condoms. This as a fact will influence the behavior and preferences of the consumers. For the case of scented toilet paper, it will be a much welcome idea. In the family unit and in social settings, the use of scented toilet paper will be highly appreciated since people do not want to be judged by the way the smell especially for bad smelling odor. In this sense, scented toilet paper will be of added advantage (Lewis 43). The society values and social class of particular community determines the way a group will behave and they are interpreted differently in every culture. Education is a vital component of a social institution. It has effect on all the aspects of culture including customer behavior. The media’s take on this new product will also impact greatly on this business venture.
Negotiation tactics need to be developed to fit this targeted market. We need to learn the culture of negotiation that is prevalent in the market. In the USA, direct confrontation is the forms the basis of negotiation here. This type of negotiation fosters a good rapport and provides a small window for misunderstanding especially when facial expressions, cultural attitudes, and body language are not familiar to one party. After both parties are familiar with each other, negotiation via the telephone could come in handy. Direct or indirect types of communication are a factor that has a great bearing on the business. An understanding is very vital for a business transaction to be conducted (Menger 13).
Since culture will affect negotiation, it is a very important to understand the link linking negotiation and culture of both parties involved in the transaction. For our case, the market concerns itself with the need and target of individual costumers (Lewis 43). Therefore autonomy should be regarded highly and safe guarded. Passing of information precisely and in the right way is also a key factor for this market since it plays a major role in intercultural contact.
Assessing the Political-Legal Environment
Political environments will affect the growth and sustenance of any business venture (Lewis 43). The presence of a stable political environment in the USA will help in the building of this business. There are minimal changes in the government policies which puts the business in safe grounds. Infrastructure in the USA is highly developed and this will come in handy in the growth of this entrepreneurship (Menger 102). Recent reduction of taxes on new and small businesses is a great incentive for this business. This will help to set up a good business base thus providing stability during these early stages. Favorable legislation and reduced or few hurdles favor the establishment of a business. Legal compliance are easily met therefore this will not be a barrier to this venture. The legal requirement for the opening and running of a business in the USA can be seen as on of the barriers that have to be overcome in the setting up of this business venture. The relative peace that the USA has enjoyed for a long time gives more reason for the establishment of this business venture. Despite the isolated cases of terrorist attacks, America has put in place enough measures to counter this threat that may want to interfere with the business environment.
The formal trade barriers that have to be considered include getting all the legal documentations to facilitate the commencement of this business. In doing the business, additional costs should be minimizing as much as possible. Costs that is associated with selling for example flights, conversion costs for bringing the products and hotels. The necessary government certification and licenses have to be secure (Lewis 143). Financial opportunities should be utilized to reduce on risks and improve on quality of service therefore productivity. This will reduce on the additional work capital and waiting hours. The right human resource is also another hurdle that should be overcome. To promote investments, the government undertakes investment promotions policies to cover for any information gaps that may be present or correct perceptions that may prevent growth of foreign investment (Menger 112). There are fiscal and financial incentives given by the government which encourages young and growing foreign investments. This reduces the tax burden on the firm. In recent times, investor developing countries have not been investing in the developed nation but have preferred to take their investment to the upcoming economies like Asia nations. In lieu of this, the government has encouraged diversification of environment in order to encourage these individuals to invest back in this developed nation for security purposes. As mentioned earlier, peace in the region has promoted the advent of entrepreneurship in USA. Animosity amongst the local population has been taken to the minimal in order to make the environment more conducive for business.
The USA has laws and regulations that have been put in place in order to protect investor’s intellectual property for instance copyrighting, brand names and patent safe guarding. However, there are instances where free use is allowed for these protected areas. Examples may include making quotations from the protected work which will require the sources of these quotations are given alongside the authors of the articles or work. Another instance is the use of work for teaching or illustrating and thirdly the use of work for the reason of news reporting. For the success of this business, long term and short term planning for the finance is very important (Menger 200). Instead of using the current operating funds, it may be more prudent in business terms to acquire export working capital, insure business for political risks, having guarantees for payment and a long term source of money or financing to acquire fixed assets. Strong relations between nations foster confidence in investors. Therefore, the USA has tried to improve on its multilateral relations between its trade partners by giving sufficient security. Fighting against corruption and promoting justice will help to give the business a clean bill of health thus providing a favorable environment for business.
Menger, R. “Japanese and American negotiator.” Overcoming cultural barriers to understanding Academy of Management Executive. New York: New York Press, 1999.Print.
Lewis, R. D. when culture collides. Clerkenwell London, UK: Nicholas Brealey Publishing, 1999. Print.