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Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

2.Import quotas: To reduce the quantity and therefore increase the market price of imported goods. The economic effects of an import quota is similar to that of a tariff, except that the tax revenue gain from a tariff will instead be distributed to those who receive import licenses. Economists often suggest that import licenses be auctioned to the highest bidder, or that import quotas be replaced by an equivalent tariff.

3.Administrative Barriers: Countries are sometimes accused of using their various administrative rules (eg. regarding food safety, environmental standards, electrical safety, etc.) as a way to introduce barriers to imports.

4.Anti-dumping legislation Supporters of anti-dumping laws argue that they prevent «dumping» of cheaper foreign goods that would cause local firms to close down. However, in practice, anti-dumping laws are usually used to impose trade tariffs on foreign exporters.

5.Direct Subsidies: Government subsidies (in the form of lump-sum payments or cheap loans) are sometimes given to local firms that cannot compete well against foreign imports. These subsidies are purported to «protect» local jobs, and to help local firms adjust to the world markets.

6.Export Subsidies: Export subsidies are often used by governments to increase exports. Export subsidies are the opposite of export tariffs, exporters are paid a percentage of the value of their exports. Export subsidies increase the amount of trade, and in a country with floating exchange rates, have effects similar to import subsidies.

7.Exchange Rate manipulation: A government may intervene in the foreign exchange market to lower the value of its currency by selling its currency in the foreign exchange market. Doing so will raise the cost of imports and lower the cost of exports, leading to an improvement in its trade balance. However, such a policy is only effective in the short run, as it will lead to higher price inflation in the country, which will in turn raise the cost of exports, and reduce the relative price of imports.

ARGUMENTS FOR PROTECTIONISM

Some proponents of protectionism claim that imposing tariffs that help protect newly founded infant industries allows those domestic industries to grow and become self-sufficient within the international economy once they reach a reasonable size. Opponents of free trade often argue that the comparative advantage argument for free trade has lost its legitimacy in a globally integrated world – in which capital is free to move internationally.

Protectionists fault the free trade model as being reverse protectionism in disguise, that of using tax policy to protect foreign manufacturers from domestic competition. By ruling out revenue tariffs on foreign products, government must fully rely on domestic taxation to provide its revenue, which falls heavily disproportionately on domestic manufacturing.

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

CURRENT WORLD TRENDS

It is the stated policy of most First World countries to eliminate protectionism through free trade policies enforced by international treaties and organizations such as the World Trade Organization. Despite this, many of these countries still place protective and/or revenue tariffs on foreign products to protect some favored or politically influential industries. This creates an artificially profitable industry that discourages foreign innovation from taking place.

Protectionist quotas can cause foreign producers to become more profitable, mitigating their desired effect. This happens because quotas artificially restrict supply, so it is unable to meet demand; as a result the foreign producer can command a premium price for its products. These increased profits are known as quota rents.

For example, in the United States (1981–1994), Japanese automobile companies were held to voluntary export quotas. These quotas limited the supply of Japanese automobiles desired by consumers in the United States (1.68 million, raised to 1.85 million in 1984, and raised again to 2.30 million in 1985), increasing the profit margin on each automobile more than enough (14 % or about $1200 in 1983 dollars, about $2300 in 2005 dollars) to cover the reduction in the number of automobiles that they sold, leading to greater overall profits for Japanese automobile manufacturers in the United States export market, and higher prices for consumers.

PRACTICE ACTIVITIES

Activity 1. Give the Russian equivalents to the following words and expressions used in the text.

1)

international trade

22)

non-acceptance

2)

international borders

23)

exchange rate

3)

advanced transportation

24)

cancellation/non-renewal

4)

globalization

 

of license

5)

outsourcing

25)

to impose a ban

6)

to have impact on smth

26)

shipment of goods

7)

economic revenue

27)

transfer risk

8)

bilateral/multilateral treaty

28)

to restrain trade

9)

international trade restriction

29)

imported/exported goods

10)

paramount

30)

restrictive quota

11)

GATT

31)

market take-over

12)

WTO

32)

government/administrative barrier

13)

unfair trade

33)

floating exchange rate

14)

selective protectionism

34)

anti-dumping legislation

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

15)

strategically important industry

35)

direct subsidy

16)

protective tariff

36)

lump-sum payment

17)

domestic industry

37)

to adjust to world markets

18)

NAFTA

38)

export subsidy

19)

economic/political risk

39)

trade balance

20)

insolvency

40)

infant industry

21)

due date

41)

domestic competition

 

 

42)

quota rent

 

 

 

 

Activity 2. Use the words in the box to complete the table. Use a dictionary to help you.

barriers dumping

protectionism

quotas open borders

tariffs

laisser-faire deregulation free port

strategic industries

liberalize

subsidize

infant industries

restrictions customs

 

 

 

 

 

in favour of free trade

 

 

against free trade

 

 

 

 

 

 

 

 

 

Activity 3. Translate the given sentences into English and pay your attention to the underlined words and expressions.

1.Протекционизм – государственная политика защиты внутреннего рынка от иностранной конкуренции через систему определенных ограничений. Такая политика, с одной стороны, оказывает содействие развитию национального производства и защиты отечественного производителя, а с другой, может привести к застойным явлениям в экономике, усилению монополизма и снижению конкурентоспособности национальных товаров.

2.Протекционизм защищает молодые отрасли хозяйства страны. Новые отрасли, зарождающиеся в одних странах, но уже развитые

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

в других, без защиты, хотя бы временной, могут погибнуть, не развившись, в условиях конкуренции с иностранной продукцией. На стадии становления отрасли ее продукция не в состоянии конкурировать с продукцией из-за рубежа, часто цена ее выше цен товаров-конкурентов,

акачество ниже.

3.Пошлины и налоги являются источником дохода государства. Во многих развивающихся и слаборазвитых странах эта статья доходов важна для бюджета.

4.Протекционизм борется со структурной безработицей, вызванной импортом более дешевой и эффективной продукции. В результате сокращения производства из-за поражения национальной отрасли в конкурентной борьбе с иностранными производителями произойдет сокращение рабочих мест, что вызовет дополнительные нагрузки на бюджет для выплат

пособий по безработице, также упадет уровень жизни и потребления встране. Протекционистская защита отрасли будет способствовать снижениюструктурнойбезработицы, покрайнеймере, вкраткосрочномпериоде.

5.Протекционизм обеспечивает национальную безопасность. Многие экономисты и политики считают, что самообеспечение (или ограничение импорта) необходимо для обеспечения национальной безопасности.

Всоответствии с данным аргументом относительно неэффективные внутренние стратегические отрасли следует изолировать от иностранной конкуренции. Неизбежным следствием подобного протекционизма будет рост цен для внутренних потребителей.

6.Протекционизм создает благоприятные условия для возникновения и поддержки внутренних монополий в торговле, промышленности, финансовой сфере, т.к. он ограничивает конкуренцию.

7.Протекционизм замедляет экономический рост. Тарифы ведут к сокращению объема международной торговли, в целом отрицательно воздействуя на мировую экономику и на уровень благосостояния страны. Защита отечественных производителей может привести к самоизоляции страны, консервации отсталых затратных производств.

8.Протекционизм сводит на нет формирование и плоды специализации страны. При свободной торговле каждая страна имеет возможность выделять и развивать свои наименее затратные и наиболее конкурентоспособные отрасли, наиболее полно реализуя свои различные выгоды (напр. географическое положение и т.п.). Протекционизм препятствует этому, т.к. приходится перераспределять ресурсы с более эффективных производств в пользу менее эффективных, чтобы удовлетворять разнообразные потребности внутреннего рынка.

9.Протекционизм, в частности, одностороннее введение тарифов, нередко приводит к торговым войнам и подрыву международной торговли. Страна, вводящая в одностороннем порядке импортный тариф для за-

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

щиты отечественных производителей от наплыва дешевых товаров их конкурентов, рискует испытать на себе ответные меры ее торговых партнеров и введения ими пошлин на ее основные экспортные товары.

10.Протекционизм не способствует снижению цен. Импортная продукция дорожает из-за тарифов. Происходит общее повышение цен. Тарифы приводят к тому, что потребители покупают местную продукцию по более высоким ценам, так как протекционизм не способствует снижению издержек, а значит и стоимости. И, наконец, протекционизм благоприятствует национальным монополиям, которые также заинтересованы в повышении цен.

11.Протекционизм косвенно подрывает экспорт страны. Сокращая доходы других стран при защите внутреннего рынка от их производителей, государство сокращает их доходы и возможность экспортировать,

втом числе и его продукцию. Также во многих странах экспортные (и не только) товары включают в себя импортные компоненты, и тарифы ведут

кросту издержек производства. Это ведет к росту цен, падению конкурентоспособности национальных товаров.

8. MARKETING AND ADVERTISEMENT

Marketing, activities involved in getting goods from the producer to the consumer. The producer is responsible for the design and manufacture of goods. Early marketing techniques followed production and were responsible only for moving goods from the manufacturer to the point of final sale, in other words to figure out how to sell the product. Now, however, marketing is much more pervasive. In large corporations the marketing functions precede the manufacture of a product. They involve market research and product development, design, and testing. The modern marketing concept is as follows production can be economically justified only by consumption, in other words, goods should be produced only if they can be sold.

Marketing concentrates primarily on the buyers, or consumers, determining their needs and desires, educating them with regard to the availability of products and to important product features, developing strategies to persuade them to buy, and, finally, enhancing their satisfaction with a purchase. Marketing management includes planning, organizing, directing, and controlling decision making regarding product lines, pricing, promotion, and servicing. In most of these areas marketing has complete control; in others, as in product-line development, its function is primarily advisory. In addition, the marketing department of a business firm is responsible for the physical distribution of the products, determining the channels of distribution that will be used and supervising the profitable flow of goods from the factory or warehouse.

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

TAILORING THE PRODUCT

Merchandise generally similar in appearance, that is, in style or design, but varying in such elements as size, price, and quality is collectively known as a product line. Product lines must be intimately correlated with consumer needs and wants.

In order to develop a line effectively, marketing research is conducted to study consumer behavior. Changing attitudes and modes of living directly affect the salability of products. For example, the trend to informal dress has changed clothing styles dramatically. Also, a high-income economy triggers a demand for products very different from those selected in a declining business cycle. The availability or lack of disposable income, meaning income over and above that spent for basic necessities such as food, shelter, and clothing, affects the buying pattern for so-called luxury products. Similarly, the purchase of durable or long-lived goods, such as refrigerators, automobiles, and houses, may be deferred when the economy is declining and may increase rapidly in periods of prosperity. Staple products, such as food and clothing, tend not to be seriously affected by the business cycle.

PRICING THE PRODUCT

The two basic components that affect product pricing are costs of manufacture and competition in selling. It is unprofitable to sell a product below the manufacturer's production costs and unfeasible to sell it at a price higher than that at which comparable merchandise is being offered. Other variables also affect pricing. Company policy may require a minimum profit on new product lines or a specified return on investments, or discounts may be offered on purchases in quantity.

Attempts to maintain resale prices were facilitated for many years under federal and state fair-trade laws. These have now been nullified, thereby prohibiting manufacturers from controlling the prices set by wholesalers and retailers. Such control can still be maintained if the manufacturers wish to market directly through their own outlets, but this is seldom feasible except for the largest manufacturers.

Attempts have also been made, generally at government insistence, to maintain product-price competition in order to minimize the danger of injuring small businesses. Therefore, pricing decisions are reviewed by the legal department of the marketing organization.

PROMOTING THE PRODUCT

Promotion is the aspect of marketing concerned with increasing sales. Marketing must be considered in making production decisions, and promotion must be considered in the overall marketing process. Advertising, personal (face-to-face) selling, and sales promotion are the main promotional activities, i.e. the methods for inducing people to buy.

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

The primary objective of advertising is to presell the product, that is, to convince consumers to purchase an item before they actually see and inspect it. Most companies consider this function so important that they have allotted extensive budgets and engaged special advertising agencies to develop their program of advertising. By repeatedly exposing the consumer to a brand name or trademark, to the appearance or package of a product, and to special features of an item, advertisers hope to incline consumers toward a particular product. Advertising is most frequently done on television, radio, and billboards; in newspapers, magazines, and catalogs; and through direct mail to the consumers. In recent years, advertising agencies have been joining forces to become giant agencies, making it possible for them to offer their clients a comprehensive range of worldwide promotion services.

Personal selling involves a salesperson trying to convince customers directly to buy a product. Personal selling is very effective when there is a concentrated market for a product. In other words, the product is not for general consumption by the public. For example, airplanes are purchased only by airlines, not by the general public. There would be little point in advertising them on television. A sales representative usually gets a commission. If the product has a high unit value, the cost of the product justifies the commission paid to the sales representative for the work. As the costs of personal selling have risen, the utilization of salespeople has changed. Simple transactions are completed by clerks. Salespeople are now used primarily where the products are complex and require careful explanation or customized application. For example, in the typical automobile sale, the salesperson's activities generally center on negotiating price and arranging terms of payment; the actual product has usually already been presold through advertising.

The purpose of sales promotion is to supplement and coordinate advertising and personal selling; this has become increasingly important in the self-service environment where there is often no sales staff. Sales promotion activities are of two types: information and stimulation. Examples of information promotion are a pamphlet or booklet about the product, a demonstration, market research information telling about the nature of the customers, and dealer training and managerial advice from producers. Stimulation promotion can be accomplished by the distribution of free samples, reduced price promotion, premiums, and coupons. (All these examples are special inducements).

Basically there are two ways to increase sales of products: find new markets and increase market share. A company seeking new markets can expand its geographical sales area or to try to sell its product to a different segment of the population. In this case promotion may involve increased advertising to spread information about the product. Personal selling at the wholesale level can encourage additional retailers to carry the products.

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

A different market situation requires a different method of promotion. When a market is saturated, it means that there are no customers to be bound. A company then needs to lure customers from the competition and gain a greater share of the total market. To increase market share, the marketing department of a company must design a total program of promotional for a particular product. Such a program may involve increased advertising to remind the customer of the name of the product. In advertising the company will also emphasize the superiority of its product by comparing it with the competition’s product. A program to increase market share may also include convincing a retailer to allow more shelf space in the store for the product and involve more stimulation of the buyer’s emotions.

Promotion attempts to increase demand for a product and thereby increase sales. It wants to make the demand for a product inelastic when prices increase and elastic when prices decrease. In other words, through promotion, companies try to keep demand and sales constant when prices increase. However, if the price decreases, they want demand for the product to increase, hoping that an increase in sales volume will offset the decrease in price.

DISTRIBUTING THE PRODUCT

Distribution consisted of transportation, storage, and related service such as financing, standardization and grading, and, and the related risks. Some products are marketed most effectively by direct sale from manufacturer to consumer. Among these are durable equipment – for example, computers, office equipment, industrial machinery and supplies, and consumer specialties such as vacuum cleaners and life insurance. The direct marketing of products such as cosmetics and household needs is very important. Formerly common «door to door products», these are now usually sold by the more sophisticated «house party» technique.

Direct marketing by mail has been expanded to virtually all types of products and services. Working people find it easy to shop in their leisure hours by catalog, and comparison shopping is made easier because catalogs generally contain extensive product information. For retailers, the use of catalogs makes it possible to do business considerably beyond their usual trading area and with a minimum of overhead. Also important are credit cards, which have made it relatively easy to purchase by mail or telephone even such high-priced items as appliances, electronic equipment, and cameras. At least half the nation's 50 leading corporations have mail-order divisions.

Television is a potent tool in direct marketing because it facilitates the demonstration of products in use. Direct sale of all kinds of goods to the public via home-shopping clubs broadcasting on cable television channels is

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

gaining in popularity. Also carving its own niche is telephone marketing, called telemarketing, a technique used in selling to businesses as well as to consumers. Most consumer products, however, move from the manufacturer through agents to wholesalers and then to retailers, ultimately reaching the consumer. Determining how products should move through wholesale and retail organizations is another major marketing decision.

Wholesalers distribute goods in large quantities, usually to retailers, for resale. Some retail businesses have grown so large, however, that they have found it more profitable to bypass the wholesaler and deal directly with the manufacturers or their agents. Small retailers fought back through cooperative wholesaling, the voluntary banding together of independent retailers to market a product.

Retailing has undergone even more change. The emphasis is on generating store traffic, speeding up the transaction, and rapidly expanding the sales volume. Chain stores (groups of stores with one ownership) and franchise stores, two of the largest types of retail distributors, have also proliferated. A franchise store is a store that is independently owned, but operates under a franchise or license from a parent company. The franchisee pays a fee for the license and a certain percentage of the total sales to the parent company. In return for this, the parent company supplies the products and promotes sales through advertising. Franchise stores are particularly popular in the fast food industry.

Special types of retailing, for example, vending machines and convenience stores, have also developed to fill multiple needs. Transporting and warehousing merchandise are also technically within the purview of marketing. Products are often moved several times as they go from producer to consumer. Products are carried by rail, truck, ship, airplane, and pipeline. Efficient traffic management determines the best method and timetable of shipment for any particular product.

FORCES AFFECTING MODERN MARKETING

Consumers today are more sophisticated than those of past generations. Their demands are more exacting, and their taste changes more volatile. Markets tend to be segmented as each group calls for products suited to its particular tastes. «Positioning» the product – that is, determining the exact segment of the population that is likely to buy a product and then developing a marketing campaign to enhance the product's image to fit that particular segment – requires great care and planning.

Competition also has sharply intensified, as the number of firms engaged in producing similar products has increased. Each firm tries to differentiate its products from those of its competitors. Profit margins, meaning the profit percentages made by a business per dollar of sales, are constantly being lessened. While costs continue to rise, competition tends to keep prices down.

Карташова А.В. «Перевод в сфере делового общения». Учебное пособие, 2010 год

The consumer movement is insistence on reputable products and services by consumer groups. Both consumer groups and government agencies have intensified their scrutiny of products, challenging such diverse elements as product design, length and legitimacy of warranty, and promotional tactics. New legislation has generally defined and extended the manufacturer's responsibility for product performance.

Ecological concerns have also affected product design and marketing. Such forces, which have added to the friction between producer and consumer, must be understood by the marketer and integrated into a sound marketing program.

Even the way a firm handles itself in public life, that is, how it reacts to social and political issues, has become significant. The public's dissatisfaction with the actions and attitudes of a firm has sometimes led to a reduction in sales. No longer may a corporation cloak its internal decisions as private affairs.

PRACTICE ACTIVITIES

Activity 1. Give the Russian equivalents to the following words and expressions used in the text.

1)

marketing technique

36) market share

2)

final sale

37) segment of population

3)

pervasive

38) method of promotion

4)

manufacture of a product

39) inelastic demand

5)

product development

40) to offset

6)

product design

41) standardization

7)

product testing

42) grading

8)

consumer

43) related risk

9)

channel of distribution

44) consumer specialty

10) flow of goods

45) direct marketing

11) to tailor the product

46) extensive product information

12) salability of a product

47) trading area

13) high-income economy

48) high-priced item

14) to trigger demand

49) potent tool

15) disposable income

50) to carve the niche

16) staple product

51) telemarketing

17) cost of manufacture

52) marketing decision

18) purchase in quantity

53) to bypass a wholesaler

19) fair-trade law

54) cooperative wholesaling

20) to promote a product

55) franchise store

21) to induce

56) within the purview of

22) to presell

57) volatile demand

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