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ENVORNMENT Objectives Cultural and social factors Political and legal factors Major economic communities Cultural and social factor Culture is a system of learned, shared, unifying, and interrelated beliefs, values, and assumptions. Successful international trade is dependent upon learning about and appreciating other cultures. Important points Cultures and subcultures have a major influence on international business transactions. We all have our cultural baggage which affects international trade. Family units, education, gender roles, family, mobility, and class system are components of social organization which differ from culture to culture. Important points Language represents the highest form of a groups culture. Learning another language could definitely have a positive impact on closing an international business deal. Ethnocentrism, culture shock, and reverse culture shock are major reactions to cultural differences. Cultural and social factors Culture accepted behaviors, values, and customs of a society. Has a strong influence on business activities Main cultural and social factors—language, education, religion, values, customs, social relationships Relationships—include interactions among families, labor unions, and other organizations Coke gets it right? Coke then researched 40,000 Chinese characters and found a close phonetic equivalent “ke-kou-ke-le”(-可口可乐), which can be loosely translated as “happiness in the mouth”. Coke gets it wrong The name Coca-Cola in China was first rendered as Kou-ke-kou-la(口渴口蜡, “食之无味” ). Unfortunately, the Coke company did not discover until after thousands of signs had been printed that the phrase means “thirsty” or “hot”. Pepsi and KFC In Taiwan, the translation of the Pepsi slogan “Come alive with the Pepsi Generation” came out as “Pepsi will bring your ancestors back from the dead.” Also in Chinese, the Kentucky Fried Chicken slogan “finger-lickin’ good” came out as “eat your fingers off.” Cultural factors Materia
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