USA Cheese Export to China - Essay Example

Socio-Cultural Factors Affecting USA’s Cheese Export to China Socio-Cultural Factors Affecting USA Cheese Export to China Introduction Export trade among different countries on different products and services has become a common phrase to many researchers and readers in the contemporary society. The phrase has been used by many intergovernmental agencies, researchers or other non-governmental organizations. With the improvement in technology, the whole world has almost become a global marketplace. Many trade organizations have been negotiated among different countries to make it easier for trade amongst them to continue for the benefits of the concerned parties. Many countries have now come together to sign these treaties with a bid to making the environment favorable for the trade to thrive. Some of the trade organizations that have been negotiated that are continuing to make this big world look like a village market is; WTO- World Trade Organization, while others that are more regional are; North America Free Trade Agreement (NAFTA), East Africa community, and many others. There are still negotiations to form more trade agreements and or realign the existing ones to be in line with the dynamic world trade requirements. Majorly, trade agreements are formed with the aim of reduce the trade barriers amongst the signatories like doing away of Quotas, excise duties and or subsidies. This is especially true considering the fact that different nationalities or regions separated by physical, economical and or socio-cultural boundaries represents the different business environment. This is majorly due to the culture difference among the countries yet the same is most held dear by the parties. Purpose of the Project It is, however, very obvious that with globalization, different cultures will meet, mix and yield an environment favorable or unfavorable for trade. This together with language barrier, distance, foreign policies make export trade difficult requiring a knowledge of all the above factors and, in addition, setting up a clear distribution chain that can help cheese product move around in the foreign country easily. When deciding to settle on a given international marketing strategy, some of the issues that should be seriously taken into consideration is the difference in culture as this may impact the consumer shopping nature (Subrammanian & Bala, 2001). The same sentiments were echoed by Herman and Heitman when he agreed to many researchers view that cultural differences may contribute to different customer reaction to a product in different countries (Heitman & Herman, 2006) It is for this reason that my research will focus on investigating the USA cheese export to China while investigating its feasibility and the socio-cultural factors that may affect its success. Overall Recommendation After numerous and longer research on the nature of markets between USA and China, it was realized with more accuracy that the business of cheese export to China is more logical and feasible compared to exporting cheese to USA. This conclusion was arrived at from many articles and publications that have always monitored the trend of business between the two countries. More insights were gotten from the USA Publication known as the Cheese market news. Rationale for Export Decision To settle on whether it is feasible to export cheese to China from USA, my team analyzed both the general environment of China paying much attention to the specific market environment, including the intended customers and likely competitors. Of major concern to this article was the socio-cultural factors that would influence the ability of the two countries to trade. With the globalization of trade, many interaction has taken place and due to the continuous cultural interactions, Western dishes are now finding their way into the Chinese markets. In fact, US export to China is reported to have increased from91 billion dollars from 2010 to $100 billion in 2011. This was majorly agricultural products making the bigger percentage. In this agricultural product, there is also the cheese market that has steadily grown its market in China. Most of the Chinese are now yearning for more cheese as reported in the in the cheese market news website. However, this still experiences socio-cultural problems in its process of penetrating the market. The cultural factors that do and have continued to impact on the ability for the USA cheese and, in general, agricultural products to penetrate the Chinese market may include; Traditional Culture Chinese are a people known to have strong cultural ties dating back to so many years. They have a way of living that they have continuously practiced through so many years. Most of their diets are comprised of Chinese dishes that unlike the West, are served by chopsticks a culture that is so distinct and unique to either Japanese or Chinese. This poses the unique challenge for the companies like MacDonald to devise a way to change this long-term tradition and introduce the new western culture. It is, however, notable that Chinese are not resistant to new things, they receive them well but would also like to keep their traditions. This is now upon the companies to devise a way of making or packaging cheese in a way that is friendly to such culture. Language Barrier Language is a major issue that is affecting the trade between USA and China. China is one of the countries that are known to use their traditional language as the predominant language in almost everything they do. English language whether American or British is not very common. This brings the problem of communication. However, nowadays there are many Chinese who in addition to Mandarin, had registered for English classes thereby enhancing their communication. This population is small compared to the Mandarin speaking Chinese ethnic groups. The official policy in China does encourage the development of various orthographies for the main national languages and their use in schools, the use of other languages is seen as inferior. Social Values Many researchers attest that company leaders especially of international corporations or companies like MacDonald should tailor their products according to the values and consumer buying behaviors of the local market. This should include re-looking at ways of spreading information to the locals. Chinese share the same values with one another meaning it has relatively less individualism but more collectivism. This would mean that the bulk of information is shared by the locals and so such companies should try to use the locals to pass such information to others (Cui & Zhang, 2009). Product Pricing Many Chinese falls in the category of a middle class and for that matter, they appreciate more favorable pricing mechanism. According to this reasoning, they prefer and give much interest to the location of a commodity as this would influence the amount that they will spend in acquiring the product. For this matter, it is important for the companies planning or that already have presence in the China to organize their distribution channels to ensure that the commodity can be accessed easily and in affordable prices to most locals. This issue of pricing can be tackled by repackaging the commodity into sizes that can attract lesser prices (Cui & Zhang, 2009). High Population Growth China has the highest population, and the growth rate is steadily increasing. This rate was put to be 1,355,692,576 by the year 2014. This population has put a lot of pressure on the available resources especially on the available industries that can produce quality nutritional products that are healthy for consumption. This creates an opportunity to the willing companies to conquer the markets with quality products. The brand names can also be used to market them. Conclusion America-China trade in cheese is highly possible but is skewed towards USA. The latter has all conditions favoring it including the availability of established companies that can export the products. The export of cheese, however, will utilize both air and sea transportation given the distance between USA and China. For deliveries that are urgently needed, the use of air will prove more promising. However, for the case of no haste, the use of sea will be promising and cost friendly. This is possible since the preparation of cheese allows for fermentation time long enough to withstand the duration taken to reach China market although this will depend on the choice of company to transport it. The company may also follow the due procedure established in China to start the full operation there to save on cost. References Cui, Y., & Zhang, T. (2009). American Fast food in Chinese Market: A cross-cultural perspective-The case of KFC and MacDonalds. Halmstad: University of Halmstad. Heitman, M., & Herman, A. (2006). Providing more or providing less? Accounting for cultural differences in cons. International Marketing Review, 6-26. Subrammanian, & Bala. (2001). Culture based product classification in Global Marketing for competitive advantage. Global competitiveness, 410-430. Read More