Logistics means transfer of value from the seller to the customer (FTAA, 2003). One of the key concerns for Venezuelan companies will be protecting their market position. Legal and intellectual property rights are an important part of this equation, but so is the ability to anticipate the reactions of customers to new competition (FTAA, 2003). MERCOSUR specifically addressed and took steps to protect software and innovative hardware advances in its language (FTAA, 2003). This alleviates many worries of this nature for all technologically-based companies, including Technodyne. Service marks and trade marks are also protected.
Delivery of services will be the greatest challenge in the Venezuelan Value Chain. Traditionally, the most effective means to move goods in Venezuela was by air and by sea (FTAA, 2003). The expense of these modes of transportation may make them cumbersome due to their effects on the cost of goods sold and final selling price of the goods. Technodyne and other corporations may have to take an active role in the development of the infrastructure in order to alleviate these effects. This will have a significant and immediate effect on cash flow, but will pay off in the long-term in the way of lower transportation costs.
Transportation costs are affected by oil prices. Currently, Venezuelan oil is controlled by a monopoly, PDVSA. Currently, this monopoly is seeking market expansion by way of an agreement with China (Marquez, 2006). This agreement could have long-term effects on Technodyne and other Venezuelan companies as well. The effects on transportation costs and other operating costs cannot be yet determined, but some effect is inevitable. This agreement may also open the door for trade agreements involving...
Global Business Strategies Vincent The aftermath of World War II has seen the evolution of economic regionalism as a means for fostering foreign trade thereby economic growth of participating countries. Economic regionalism was a conscious attempt to manage the opportunities and constraints created by international economic tie-ups after World War II through institutional arrangements facilitating free flow of goods and services and coordination of foreign economic policies. It embraced free trade areas,
Market Vincent There has been an ongoing process for the integration and co-operation of the countries in South America for quite sometime, but the individual countries have their own structures and problems. This leads to a situation where not much progress seems to be made. The first attempt at the regional development of Latin America through the cooperation of the member states was through the Latin American Free Trade Association, set up
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