Reference no: EM131400577

1. Outline why the culture of a country might influence the cost of doing business in that country. Illustrate your answer with examples.(one paragraph)

2. Respond to following paragraph(short comment,one paragraph)

Sometimes cultural difference between countries can cause a negative impact when conducting free market businesses.  Take for example Walmart wanting to expand its operation in India.  It attempted to do so but buying out local farms and small stores.  As it did it was able to lower prices for simple vegetables such as tomatoes and potatoes.  Thinking that Indians would buy into this strategy Walmart opened up shop.  Indians may be price conscious as much as Americans but to them loyalty and integrity meant more.  As soon as the Indians found out that local jobs for the average citizen was being cut they immediately stopped buying from Walmart.  Sometimes moral and ethics and taking care of neighbors is more important than buying things for the cheapest price.  The American culture is embedded with how best to save cost when shopping.  People are always trying to find the best deal.  But they do not care about the ethics and morality of the process.  Many cultures; Germany and India included care a lot more about what happens downstream.

 Another example is the Japanese culture.  They take very seriously about having their own corporations run their country.  It is very difficult for outsiders to go business there.  Japan has a very large IT distribution sector and the largest IT distribution corporation that generates $40 billion in revenues headquartered in America is not able to set-up shop in that country.  Japanese culture simply believes that it is best if their corporation, their employees and their stock-holders benefit from doing business within.  It is very interesting because Japan does an amazing job at selling its products and technology outside.  As a matter of fact they have already successfully started robotics assistance for the elderly.  Something that the rest of the world will slowly catch-up on.