Analysis of Elasticity and the Theory of Consumer Choice

Analysis of Elasticity and the Theory of Consumer Choice Economics calculate elasticity and use the consumer choice theory to determine marketability of various commodities. Elasticity differs among items since some items are more essential to consumers than others are (Davis). The consumer choice theory is essential in determining the most attractive markets. However, it has certain shortcomings.Advertising We will write a custom essay sample on Analysis of Elasticity and the Theory of Consumer Choice specifically for you for only $16.05 $11/page Learn More The difference in elasticity is caused by the variations in the level of demand for different products. Goods and services that are necessities are insensitive to cost alterations as consumers usually purchase these items regardless of cost adjustments. Price increase of an item that is less of a necessity puts off more customers since the opportunity cost of acquiring the items becomes too high. A product is highly elastic if an insignificant alteration in it s price leads to an acute change in the supply or demand of the product. Commonly, such items are accessible in the market at all times, but consumers rarely purchase them. Conversely, an inelastic commodity is one in which price alterations may only lead to modest changes in the quality supplied and demanded. These commodities are those that tend to be more of a necessity to the customer in his/her everyday life (Moffatt). The equation for finding elasticity is percentage change of the amount of products demanded for divided by the percentage change in cost. If elasticity is equal to or greater than one, the good/service is elastic. Economists say that the higher the rate of elasticity, the lower the market for the product when the price increases. The opposite is also true. Economists and business people use the formula to understand how sensitive the demand for particular goods/services is to changes in price (Hubbard 82). To determine elasticity of goods and services, economists analysis demand curves. When the amount of products demanded diminishes significantly due to a negligible adjustment in cost, the demand curve becomes flat, and this shows that the demand for the product is elastic. On the other hand, when the curve is upright the demand is inelastic, as quantity adjusts modestly with massive alteration in cost. Elasticity of supply functions in a similar manner. When changes in supply result into a massive change in quantity supplied, the supply curve flattens and the commodity is elastic. In this case, the elasticity is higher or equal to one (Davis). However, if a substantial change in price does not have a major impact in the quantity supplied, the curve becomes steeper. Its elasticity becomes less than one. The theory of consumer choice is another vital trading tool. It is based on the hypothesis of utility and marginal utility. Economists use the terminology utility to express the contentment resulting from the consumption of a product. They say that consumers act sensibly while choosing the preferred products to exploit total utility. According to the theory, consumers always take into consideration four main factors.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More First, they consider how much satisfaction they derive from purchasing and subsequently consuming an extra unit of a product. Next, they consider the amount of money that they have to pay to acquire the product and ensure they do not lose their money. Moreover, they consider the degree of satisfaction they can derive from consuming substitute products. Finally, they evaluate the prices of the substitute products (Theory of Consumer Choice†). The experts use the term marginal utility to explain change in satisfaction that results from the consumption of each additional product. The theory of diminishing marginal utility articulates that the marginal u tility resulting from consuming a good/service decreases as the consumption of that product increases. The theory of consumer choice states that a rational consumer spends on his/her earnings in a manner that maximizes the total utility arising from all commodities consumed. For example, in case a customer intends to buy one good out of two differently priced products, total utility will be achieved when the satisfaction arising from commodity A is equal to the satisfaction arising from commodity B. In this case, the total marginal utility of A and B becomes equals to that of another similar good. Therefore, when the price of product A diminishes, the equality becomes an inequality and the consumer chooses a cheaper preference. The consumer will buy more of the product, if he/she receives more utility from it. The theory is essential as it forecasts demand and supply (Theory of Consumer Choice†). However, the theory also faces criticism. Some economists assert that it is not p ossible to measure utility impartially, as there are no systems for doing the work. Moreover, they have reservations regarding the hypothesis of rational behavior among consumers. They say consumers do not have all the information on the products available in the market and therefore cannot make rational decisions (Moffatt). The consumer choice theory, however, is a useful economic tool for determining appropriate trading patterns. Elasticity forecasts levels of demand and supply. The elasticity formula is easy to use, and all entrepreneurs can use it to improve their understanding of their markets. Davis, Marc. Microeconomics: Introduction | Investopedia. Investopedia Educating the world about finance. n.p., n.d. Web.Advertising We will write a custom essay sample on Analysis of Elasticity and the Theory of Consumer Choice specifically for you for only $16.05 $11/page Learn More Hubbard, R. Glenn, and A. P., Brien. Microeconomics. Upper Saddle River, N.J .: Pearson Prentice Hall, 2006. Print. Moffatt, Mike . Price Elasticity of Demand. Economics at About.com. N.p., n.d. Web. Theory of Consumer Choice indifference curves, consumers optimal choice. Business Economics | Introduction to Basic Economics. n.p., n.d. Web.

How to Perform the Instant Fire Chemistry Demonstration

How to Perform the Instant Fire Chemistry Demonstration Heres a simple fire chemistry demonstration that produces instant fire without using matches or any other type of flame. Potassium chlorate and ordinary table sugar are combined. When a drop of sulfuric acid is added, a reaction is catalyzed which produces heat, an amazing bright/tall purple flame, and a lot of smoke. Instant Fire Materials Potassium chloratePowdered (confectioners) sugar or table sugar (sucrose)Sulfuric acidSmall glass jar or  test tube Procedure Mix  equal parts potassium chlorate and table sugar (sucrose) in a small glass jar or test tube. Choose a container you dont value, as the demonstration will probably cause it to shatter.Place the mixture in a fume hood and equip lab safety gear (which you should be wearing anyway). To initiate the reaction, carefully add a drop or two of sulfuric acid to the powdered mixture. The mixture will burst into a tall purple flame, accompanied by heat and a lot of smoke.How it works: potassium chlorate (KClO3) is a powerful oxidizer, used in matches and fireworks. Sucrose is an easy-to-oxidize energy source. When sulfuric acid is introduced, potassium chlorate decomposes to produce oxygen:2KClO3(s) heat - 2KCl(s) 3O2(g)The sugar burns in the presence of oxygen. The flame is purple from the heating of the potassium (similar to a flame test). Tips Perform this demonstration in a fume hood, as a considerable quantity of smoke will be produced. Alternatively, perform this demonstration outdoors.Granulated table sugar is preferable to powdered sugar which is, in turn, preferable to reagent grade sucrose. The powdered sugar is capable of smothering the fire, while the granules of the reagent-grade sucrose may be too large to support a ​good reaction.Follow proper safety precautions. Do not store the potassium chlorate and sugar mixture, as it can react spontaneously. Use care when removing the potassium chlorate from its container, to avoid sparking, which can ignite the container. Wear the usual protective gear when performing this reaction (goggles, lab coat, etc.).The Dancing Gummi Bear is a variation on this demonstration. Here, a small quantity of potassium chlorate is carefully heated in a large test tube, clamped to a ring stand over a flame, until it has melted. A Gummi Bear candy is added to the container, resultin g in a vigorous reaction. The bear dances amidst bright purple flames.

Dessertation on ''stress on international students Dissertation

Dessertation on ''stress on international students - Dissertation Example To determine the specific stressors affecting the students, I structured questionnaires intended to be filled by the international students. In the the questionnaires the students are required to fill whether they are stressed or not by the following factors. They include financial challenges, university fees, getting job in the United Kingdom, language and accommodation. In addition, the questionnaire will determine whether international students pay more fees than the local students do. The questionnaires were sent 100 the international students through the internet and they were supposed to send back the results after one day. The study will target undergraduate and graduate students and all genders. This study is informed by recent findings by Amposah (2010) which established that international students in Manchester University have considerably higher levels of stress than the local students in spite of them facing equal academic challenges. This has resulted to the students ado pting poor stress coping mechanisms including drug abuse, dropping out of school and prevalence of psychological disorders. According to Agnes and Harriet (1993), stress is the emotional feeling a person experiences while under pressure. In this regard, stress is a response of preparing the body to face anticipated tough challenges, with renewed focus, strength and high level of concentration. According to Abe, et al. (1998:21) regulated stress is a motivational factor and it enhances output of the affected person. However, too much stress arising from excessive pressure is counterproductive and it could lead to physical and mental illness. A research conducted by Amposah (2010) established that international students are very prone to stress because of enormous pressure of excelling in their studies, meeting their living expenses and adjusting in the foreign country. Stress often happens in situations that require immediate attention, but in some cases, it extends for long periods causing a lot health and behavioral problems to a person. The effects of long-term stress normally results to feelings of being overwhelmed by the challenges at hand and low energy levels to cope (Mind for better mental health, 2010). Abe, et al (1998:442) established that congested schedules that hardly leave enough time for relaxation and rest as the most prevalent stressors among international students. Though most international students face similar stressors, they have different ways of handling and coping with the stressing situations. Some externalize it by projecting their anger to other persons while other internalize the pressures resulting to mental and physical disorders .These can subsequently develop into severe health and behavioral conditions such as depression, anxiety, panic attacks , drug abuse, suicidal tendencies among others(Mind for better mental health, 2010). This study investigates stressors on international students, undertaking their studies in Manchester University in the United Kingdom. Manchester University in United Kingdom has an ancient tradition of attracting and admitting students from different countries in the world. The most common feature that attracts foreign students to universities in the UK is the high academic standards that often lack in the institutions of higher learning in their home countries. British universities are credited for producing prominent personalities in the world in their respective areas of specialization. In this respect, they attract numerous

Max Weber Research Paper Example | Topics and Well Written Essays - 1250 words

Max Weber - Research Paper Example Weber was highly inspired by German idealism and specifically by neo-Kantianism. The most significant influence of neo-Kantianism thought on Weber was the idea that reality is basically disorganized and perplexing, with all the balanced order coming from the way in which the individual mind focuses its attention on particular areas of reality and arranges the perceptions that come as an output. Social Action Max Weber viewed sociology as a science of social action. His early focus in sociology revolved around subjective meanings that individuals attach to the actions that they take and their interpretations of concepts within a particular social context (Elwell, n.d.). According to this, Weber categorizes action in four different ways. The following kinds of action can be taken. Zweckrational (the means used to achieve the required goal are rationally chosen). Wertrational (the goal one is trying to achieve might not be rational, but rational ways are used to attain it). Affective ac tion is rooted in the emotional state of an individual instead of rational thinking. Traditional action is the action that is guided or regulated by customs, habits, or traditions. According to Weber, there are many factors in action behind human behavior, and he believed that most of the behavior exercised by individuals is a mix of the above mentioned actions. He advocated that a distinctive shift in the motivation of individual behavior is a distinguishing feature of a modern society (Elwell, n.d.). Major part of his work investigates the factors that gave birth to the idea of rationalization in the western society. Weber believes that social action is an illustration of the use of an ideal type. An ideal type provides the fundamental method for comparative and historical study (Elwell, n.d.). It also helps the researcher when he or she is studying a specific area of the society. This ideal type cannot be a real phenomenon; it is a classic hypothetical example against which the r eality could be compared (Barnard, Burgess, & Kirby, 2004). Theory of Rationalization According to Weber, rationalization refers to the increasing human control over the social environment. As per this theory, there are three basic points that are individual cost-benefit analysis, the bureaucratic arrangement of organization, and understanding of reality without searching for explanations in mystery, magic, or supernatural beliefs (Allan, 2005). The process of rational thought is the sensible application of knowledge to arrive at a preferred outcome. It leads to competence, cooperation, efficiency, and power over both the natural and the social surroundings (Elwell, n.d.). It also makes individuals come out as free, as he or she breaks the net of traditional thoughts and illogical belief systems. In his later works on bureaucracy, Weber discusses rationalization in detail. Weber advocates that bureaucracies are goal-defined organizations devised according to rational factors in orde r to effectively achieve their goals (Elwell, n.d.). The bureaucratic cooperation of the actions of numerous people has become the main structural characteristic of modern societies. As regards the concept of rationalization, Weber stayed doubtful. He saw it as a two-sided phenomenon. On the

Treatment of Folk Illnesses Essay Example for Free

Treatment of Folk Illnesses Essay The world offers every people a chance to be sick due to some of the outside factors that can harm someone else’s health. There are hazards for the lungs like pollution and for the stomach which are the bacteria and microorganisms that are prevalent everywhere. Even with the body parts of a human being, one can already find some threats that can cause cholera or diarrhea in their faces or hands where there is staphylococcal party if not reproduction their colonies. Of course regarding some diseases, there are many classical methods that the old people think would help cure these hazards to health. There are also many documents that support the researchers’ views about the different ways our ancestors deal with their sicknesses before. Using the reference mentioned below, we can see that there are already developments in our ancestors’ way of thinking that they are devising strategies in order to cure their own illnesses by the naturally occurring cures that can be seen elsewhere then. Say, garlic is used to treat hypertension and oregano is used as an expectorant which I think is still effective until today. The concept of having a set of ready to pick and ready-made medicines gave the early people especially in Mexico that whatever disease they might be getting in the atmosphere or environment is curable and can easily be neglected after some time. However for this mind set, there might be some difficulties and disadvantages given that we already have technological diseases also. These conditions can be from the improvement and development of the facilities that we are using nowadays. The causes of disease in the present time are from complex matters such as chemical intoxication and suffocation due to the complexity of course of the activities we do everyday. These diseases might not be cured immediately by the set of the native way our old fellows treat their conflicts or struggles regarding their health. As what is already mentioned, the use of garlic as antibiotic is still useful. In fact the safety of using it was ranked with three positive signs, however, for extreme reasons, a bulb of garlic will not be enough to lower the blood pressure of a person. Hence, medical treatment is already needed in order to provide the patient the right medication and avoid the risk of killing him/her. For all we know, hypertension is also related with heart attack and some fatal heart disease. If in case there are some patients who got their diseases using the folk style of treating illnesses, it is still important that the doctor will have a set of explanations that will make the patient understand wholeheartedly that the old way of seeking for cure is not effective with their diseases. There should be some ready-answers so that the doctor will find it easy to make them understand and appreciate the modern way of curing. It will also be helpful if the doctor will be very careful of delivering the message to the patient not offending their traditions on using some herbs to medicate them. The patient in turn should be ready to accept the information a doctor might give him/her since he/she in the first place consulted or chose to seek for a doctor’s help. Health is an important aspect in a human’s life. It is a source of the driving force of every man that will enable them to pursue each day with joy and gladness. Folk style medication is as good as the modern medicine as long as people who use it understand how it works and how it is applied with every single disease corresponding to one substance or case. But as what many doctors say, it is really better to seek advice from experts who have already studied the concepts, what-about’s, how-about’s and where-about’s of different diseases. We might be harmed by the hearsays since the folk concepts are being transferred from a generation to another generation that there is a high possibility of misinformation and the like. It is a good thing we give attention to what our ancestors have given and developed, and good as it is, we are able to have doctors, scientists and nurses that modified, developed and improved our knowledge about our health enabling us to become healthier people. Reference Nancy Neff. Folk Medicine in Hispanics in the Southwestern United States. Retrieved 6 February 2008 from http://www.rice.edu/projects/HispanicHealth/Courses/mod7/mod7.html

Vocabulary :: essays research papers fc

Introduction One of the most fascinating aspects of words is that they all have a past. Some words in English, for example, can be shown to have been in place for more than 5000 years (P. Baldi, 1999). Ordinarily we pay little attention to the words we articulate; we concentrate instead on the meaning we intend to express and we are seldom conscious of how we express that meaning. Only if we make a mistake and we have to correct it or we have difficulty remembering a word we become conscious of our word. This means that most of us do not know where the word we use come from and how they come to have the meaning they do. English words come from several different sources. They developed naturally over the course of centuries from ancestral languages, they are also borrowed from other languages and we create many of them by various means of word vocabulary available to us today. History and morphology of the word Mother The idea of the mother goddess was invented in early ice age, some 25,000-30,000 years ago. She and her life giving breasts were called omma from which we have the words akin to maternal, matter, and mother. By the late ice age the Semites had shortened omma to om. The Dravidians of India are Semites who migrated to India after the ice age. They still call mother goddess omm. Om is also the present day Arabic word for female and mother. Omma became ma among the Iranians, meaning the female breast. From ma we have the Iranian maman. Also, we have the Iranian ma-Dar (earlier ma-tar) meaning breast which became mater in Latin, modor in Old English (725), madre in modern Italian, and mother in modern English (1425), (R.K.Barnhant, 2000). Collocation There are several words that fit together with the word mother.  Mother Country  Mother Nature  Mother Figure  Mother Tongue  Mother Board Connotation The word mother has a positive connotation as it describes maternal tenderness and affection although in American English mother could also mean motherfucker which carry a negative and vulgar meaning (Chambers, 1994). Semantic field relation The following are some semantic field relations to the word mother.  Father  Son  Daughter Semantic usage   Ã‚  Ã‚  Ã‚  Ã‚  REGISTER Mother  Ã‚  Ã‚  Ã‚  Ã‚  Very Formal British English Mum  Ã‚  Ã‚  Ã‚  Ã‚  Informal British English Mummy  Ã‚  Ã‚  Ã‚  Ã‚  Informal British English mainly used by children Mom  Ã‚  Ã‚  Ã‚  Ã‚  Informal American English Mommy  Ã‚  Ã‚  Ã‚  Ã‚  Informal American English mainly used by children Ma  Ã‚  Ã‚  Ã‚  Ã‚  Informal expression American and British English working class (often used with any much older woman)

Case Study of Starbucks

When the announcement was made in mid 2008 that Starbucks would be closing nearly three-quarters of its 84 Australian stores there was mixed reaction. Some people were shocked, others were triumphant. Journalists used every pun in the book to create a sensational headline, and it seemed everyone had a theory as to what went wrong. This case outlines the astounding growth and expansion of the Starbucks brand worldwide, including to Australia. It then shifts focus to describe the extent of the store closures in Australia, before offering several reasons for the failure and lessons that others might learn from the case. . Background Founded in 1971, Starbucks' first store was in Seattle's Pike Place Market. By the time it went public in 1992, it had 140 stores and was expanding at a breakneck pace, with a growing store count of an extra 40-60% a year. Whilst former CEO Jim Donald claimed that â€Å"we don't want to take over the world†, during the 1990s and early 2000s, Starbucks were opening on average at least one store a day (Palmer, 2008). In 2008 it was claimed to be opening seven stores a day worldwide.Not surprisingly, Starbucks is now the largest coffee chain operator in the world, with more than 15,000 stores in 44 countries, and in 2007, accounted for 39% of the world's total specialist coffee house sales (Euromonitor, 2008a). In North America alone, it serves 50 million people a week, and is now an indelible part of the urban landscape. But just how did Starbucks become such a phenomenon? Firstly, it successfully Americanised the European coffee tradition – something no other coffee house had done previously.Before Starbucks, coffee in its current form (latte, frappacino, mocha, etc. ) was alien to most US consumers. Secondly, Starbucks did not just sell coffee – it sold an experience. As founding CEO Howard Schultz explained, â€Å"We are not in the coffee business serving people, we're in the people business serving coffee† (Schultz and Yang, 1997). This epitomised the emphasis on customer service such as making eye contact and greeting each customer within 5 seconds, cleaning tables promptly and remembering the names of regular customers.From inception, Starbucks' purpose was to reinvent a commodity with a sense of romance, atmosphere, sophistication and sense of community (Schultz and Yang, 1997). Next, Starbucks created a ‘third place' in people's lives – somewhere between home and work where they could sit and relax. This was a novelty in the US where in many small towns cafe culture consisted of filter coffee on a hot plate. In this way, Starbucks positioned itself to not only sell coffee, but also offer an experience. It was conceived as a lifestyle cafe.The establishment of the cafe as a social hub, with comfortable chairs and music has been just as important a part of the Starbucks brand as its coffee. All this came with a premium price. While people were aware that the beverages at Starbucks were more expensive than at many cafes, they still frequented the outlets as it was a place ‘to see and be seen'. In this way, the brand was widely accepted and became, to an extent, a symbol of status, and everyone's must-have accessory on their way to work.So, not only did Starbucks revolutionise how Americans drank coffee, it also revolutionised how much people were prepared to pay. Consistency of product across stores, and even national boundaries, has been a hallmark of Starbucks. Like McDonald's, Starbucks claims that a customer should be able to visit a store anywhere in the world and buy a coffee exactly to specification. This sentiment is echoed by Mark Ring, CEO of Starbucks Australia who stated â€Å"consistency is really important to our customers †¦ a consistency in the product . . . he overall experience when you walk into a cafe . . . the music . . . the lighting . . . the furniture . . . the person who is working the bar†. So, whilst th ere might be slight differences between Starbucks in different countries, they all generally look the same and offer the same product assortment. One way this is ensured is by insisting that all managers and partners (employees) undergo 13 weeks of training – not just to learn how to make a coffee, but to understand the nuances of the Starbucks brand (Karolefski, 2002) and how to deliver on its promise of a service experience.The Starbucks formula also depends on location and convenience. Starbucks have worked under the assumption that people are not going to visit unless it's convenient, and it is this assumption that underlies their highly concentrated store coverage in many cities. Typically, clusters of outlets are opened, which has the effect of saturating a neighbourhood with the Starbucks brand. Interestingly, until recently, they have not engaged in traditional advertising, believing their large store presence and word-ofmouth to be all the advertising and promotion t hey need.Starbucks' management believed that a distinctive and memorable brand, a product that made people ‘feel good' and an enjoyable delivery channel would create repeat business and customer loyalty. Faced with near-saturation conditions in the US – by 2007 it commanded 62% of the specialist coffee shop market in North America (Table 1 ) – the company has increasingly looked overseas for growth opportunities.As part of this strategy, Starbucks opened its first Australian store in Sydney in 2000, before expanding elsewhere within New South Wales and then nationwide (albeit with 90% of stores concentrated in just three states: NSW, Victoria and Queensland). By the end of 2007 Starbucks had 87 stores, enabling it to control 7% of the specialist coffee shop market in Australasia (Table 1 ). By 2008, consumer awareness of Starbucks in Australia was 90% (Shoebridge, 2008), with each outlet selling, on average, double the number of coffees (270 a day) than the rest of Australia's coffee shops (Lindhe, 2008). . Expansion into Asia Starbucks currently operates in 44 markets and even has a small presence in Paris – birthplace and stronghold of European cafe culture. Beyond North America, it has a very significant share of the specialist coffee shop market in Western Europe, Asia Pacific and Latin America (Table 1) and these regions make strong revenue contributions (Table 2). It is in Asia that they see the most potential for growth as they face increasing competitive pressure in their more traditional markets.Half the international stores Starbucks plans to operate in the next decade will be in Asia (Euromonitor, 2006; Browning, 2008). Indeed, Starbucks has done well in international markets where there has not traditionally been a coffee drinking culture, namely Japan, Thailand, Indonesia and China. In effect it has been responsible for growing the category in these markets. The first Starbucks outside the US opened in Tokyo in 1996, and since then, Starbucks' Japanese stores have become twice as profitable as the US stores.Unsurprisingly then, Japan is Starbucks' best performing overseas market outside North America. More than 100 new stores open each year in Japan, and coffee is now more popular than tea in terms of both volume and value (Lee, 2003; see also Uncles, 2008). As opposed to their entry into the Australian market, Starbucks made small changes to its formula for the Japanese market; for example, the invention of a green tea frappucino, and the provision of smaller drinks and pastries to conform to local tastes.Starbucks arrived in China in 1998 and by 2002 had 50 outlets, and 165 outlets by 2006 (BBC News, 2006), quickly becoming the nation's leading coffee chain. Starbucks now sees China as its key growth market due to the size and preferences of the emerging middle class. In the Asia-Pacific region, Starbucks command of the specialist coffee shop market grew from 15% in 2002 to 19% in 2007 (refer to Table 2). The total market for cafes in China grew by over 135% between 1999 and 2004 to reach US$2. 6 billion.It is projected to grow another 144% by 2008 to reach US$6. 4 billion in sales. More specialty coffee shops are opening across China as a middle class with strong purchasing power emerges, although this rise in coffee consumption is highly concentrated in large cities such as Beijing, Shanghai and Guangzhou. Starbucks has said that it expects China to become its biggest market after the US and the plan is to open 100 stores a year (Euromonitor, 2006). Significantly, certain Western brands are valued by Chinese consumers and Starbucks appears to be one of them.A growing number of China's 500 million urbanites favour Starbucks for its ambience, which is seen as an important signal of service quality, and Starbucks' design concept rests easily with China's consumers, who tend to lounge with friends while sipping coffee. Its outlets in China frequently maintain larger seating a reas than average outlets in other countries, and plush chairs and davenports are provided to accommodate crowds that linger. However, success for Starbucks in China is not a given, and they will face several challenges in the coming years.China's accession to the WTO has led to the gradual relaxation of the policy governing foreign-owned retail outlets, and this will lead to more foreign investment and thereby competition (Lee, 2004). Several multinationals are engaged in selling coffee (including KFC, McDonald's, Yoshinoya, and Manabe), and a number of local brands have recently emerged, some even imitating Starbucks' distinctive green and white logo and its in-store ambience (notably Xingbake in Shanghai). Furthermore, the reduction of import tariffs on coffee will also encourage foreign investment in coffee. . The Australian retail coffee industry Australia's taste for coffee is a by-product of the waves of immigrants arriving on the country's shores following World War II. Euro pean migrants, predominantly Greeks and Italians, were the first to establish the coffee culture, which was later embraced more widely in the 1 980s. For decades Australians enjoyed a variation of the ‘lifestyle coffee experience' that Starbucks created from scratch in the US. Australians did not need to be introduced to the concept of coffee as many other countries did.Savouring a morning cup of coffee was already a ritual for many consumers. It is fair to describe Australia's coffee culture as mature and sophisticated, so when Starbucks entered Australia in 2000, a thriving urban cafe culture was already in place. This established culture saw Australians typically patronise smaller boutique style coffee shops, with people willing to travel out of their way for a favoured cup of coffee, especially in Melbourne where coffee has developed an almost cult-like following.For Australians, coffee is as much about relationships as it is about the product, suggesting that an impersona l, global chain experience would have trouble replicating the intimacy, personalisation and familiarity of a suburban boutique cafe. Furthermore, through years of coffee drinking, many Australians, unlike American or Asian consumers, have developed a sophisticated palate, enjoying their coffee straighter and stronger, and without the need to disguise the taste with flavoured, syrupy shots. This love of coffee is easily quantified. The Australian market is worth $3 billion, of which $1. billion relates to the coffee retailing market. For every cup of coffee consumed out of home, two cups are consumed at home (AustraIAsian Specialty Coffee Association, 2006). Per capita consumption is now estimated at 2. 3 kg-twice as much as 30 years ago. Whilst Australians are among the highest consumers of instant coffee in the world, they are increasingly buying coffee out of the home (Euromonitor, 2008c). More than 1 billion cups of coffee are consumed in cafes, restaurants and other outlets each year, representing an increase of 65% over the last 10 years.Even between 2000 and 2005, trade sales of coffee have increased about 18%. In 2007, the growth in popularity of the cafe culture resulted in trade volume sales growing at an annual rate of 5%. Some 31% of the coffee sold through foodservice is takeaway, and it is thought that ‘fast coffee' will be a growth area in future years (Euromonitor, 2008d). There is also a trend towards larger takeaway sizes, with 400 ml cups increasing in popularity (Euromonitor, 2008d). One might argue that Starbucks drove these trends, especially in regards to larger sizes.There are almost 14,000 cafes and restaurants serving a variety of coffee types in Australia, and during 2006/07, they generated $9. 7 billion in income (Australian Bureau of Statistics, 2008). However, despite these statistics, the coffee business does not guarantee success. As Paul Irvine, co-founder of Gloria Jean's notes, â€Å"Australia is a tough retail market a nd coffee retailing is particularly tough†. According to official statistics, the cafe business is not always profitable, with the net profitability of cafes falling to about 4%.For a cafe to be successful, it has to offer marginally better coffee than local competitors, and do so consistently. Coffee drinkers in Australia are discerning, and they will go out of their way to purchase a good cup of coffee. They are not as easily persuaded as people from other countries simply to visit their nearest cafe. Secondly, for a cafe to make a profit, it needs to turn over 15 kg of coffee a week The national average is 11 kg, so a cafe has to be above average to begin with to even make a profit. Any newcomer needs to understand this before entering the market.The other significant constraint on profitability is the cost of hiring baristas, with a good one costing between $1000 and $1500 a week (Charles, 2007). However, it seems that this is a necessary cost in order to deliver a superio r product. The question that then begs to be asked is: How well did Starbucks understand this existing coffee culture? Did they under-estimate the relational aspect of coffee purchasing in Australia, as well as the importance of the quality of ingrethents and the skills of the person making each cup?Did they overestimate the value consumers attach to the in-store experience and the ‘third place' concept? Or did they just look at the statistics regarding coffee consumption and think that operating in Australia was a license to print money? Did they simply see Australia as the next logical step to global domination? Starbucks has 87% of the US specialty coffee shop market, and only now is it beginning to feel pressure from non-traditional competitors such as Dunkin Donut, 7 Eleven, McCafe and Krispy Kreme (Burritt, 2007).However, in Australia, the competitive landscape is different. Gloria Jean's dominates the high-street part of the coffee retailing market and McCafe dominates the convenience end (Shoebridge, 2008). Other significant competitors include The Coffee Club and Wild Bean Cafe (an add-on to BP petrol stations) and Hudson's Coffee (see Table 3). All offer a similar in-store experience to Starbucks, with McCafe from 2007 onwards refurbishing many McDonald's stores to imitate the Starbucks' experience, albeit at the economy end of the market. 5. Growth grinds to a halt . . . store closuresIn recent times however things have started to go wrong for Starbucks. Internationally, company earnings declined as cashstrapped consumers faced record petrol prices and rising interest rates meaning they have had to pull back on gourmet coffee and other luxuries. Sales fell 50% in the last 2 years, the US share price fell more than 40% over the past year and profits dropped 28% (Bawden, 2008; Coleman-Lochner and Stanford, 2008; Mintz, 2008). Consequently, Howard Schultz, the founder and chairman of Starbucks, resumed the position of CEO in 2008 with the aim of revitalising the business.He slowed the pace at which stores were opened (and in fact closed more stores than he will open in the coming year), introduced key performance targets (KPTs) and an employee rewards system in the US, and simultaneously shut down every store in America for three and a half hours of staff training (Muthukumar and Jain, 2008). Customer-oriented initiatives have included the addition of more food, the launch of the Starbucks card and Starbucks express, and the provision of high-speed wi-fi internet access (Hota, 2008).Notably, Schultz acknowledges that the company's focus has been more on expansion than on customer service – the very thing that was at the heart of its unique value proposition. However, it seems that these measures were too late for the Australian operation. On 29th July 2008, Starbucks announced that it would be closing 61 of its 84 Australian stores (i. e. , 73%) by August 2008, resulting in a loss of 685 jobs. All of these stores had been under-performing (8 were in SA, ACT and Tasmania, 28 in NSW, 17 in Victoria and 8 in Queensland).This decline of Starbucks in Australia was not as sudden as many would have us believe and in fact some reports (Edwards and Sainsbury, 2008; Shoebridge, 2008) indicated that by late 2007 Starbucks already had: * accumulated losses of $143 million; * a loss of $36 million for that financial year; * lost $27. 6 million the previous financial year; * loans of $72. 3 million from Starbucks in the US; * was only surviving because of its US parent's support. These closures saw 23 stores kept open in prime locations in Sydney, Melbourne and Brisbane. But this begs the question: can a 23-store chain be viable for the brand in the long-term?Based on the approximate numbers in Table 3, Starbucks had a 6% share of stores in Australia before the closures; this has now fallen to a share below 2%. Even before the closures, Australasia represented only 1% of company sales (Table 2) and now the f igure is expected to be much lower. This may not make much commercial sense as it will be difficult to achieve economies of scale in terms of marketing and purchasing, and such small numbers are totally out of step with the clustering strategy adopted in its strongest markets -the US, Japan and China.However, it could also be argued that with Starbucks' strategy of global domination, it is unlikely that it will ever close its Australian business entirely. Whilst Starbucks' management have been keen to suggest that â€Å"this decision represents business challenges unique to the Australian market and in no way reflects the state of the Starbucks business in countries outside of the United States†, the US market has also suffered. By September 2008, 600 stores had closed (or were due for closure), with about 12,000 workers, or 7% of Starbucks' global workforce affected (Mintz, 2008).It should be noted that the situation in the US has only worsened as a result of the global fina ncial crisis. 6. So what went wrong? Opinions abound as to why Starbucks failed in Australia. Our research suggests there is some truth to many of these opinions. Whilst the troubled economy might seem an easy scapegoat, with people tightening their belts and eating out less, it is unlikely that this was the core problem as evidenced by the continuing growth of their competitors. Indeed, coffee is no longer considered a luxury item by many Australians, but rather an affordable part of their daily routine.Instead, there is substantial evidence to suggest a number of factors combined to bring about Starbucks' demise. 6. 1. Starbucks overestimated their points of differentiation and customer perceived value of their supplementary services â€Å"I just think the whole system, the way they serve, just didn't appeal to the culture we have here† Andrew Mackay, VP of the Australian Coffee Traders Association, in Martin (2008) Whilst there was initial curiosity and hype about Starbuck s, after trying it, many Australians quickly found that it failed to offer a particularly unique experience that was not offered by other chains or cafes.Given the strong established coffee culture and discerning palates of Australians, the core product – coffee – was not seen as particularly different from, say, a latte or short black from a good suburban barista, Gloria Jean's or Coffee Club. Its point of difference in Australia, where a coffee culture already existed, had to be in its supplementary or value-adding services – i. e. , its unique servicescape, engaging customer service, brand image and so on (Lovelock et al. , 2007).But was this worth a premium price, especially as the competition began replicating Starbucks in-store experience? Starbucks has since been harshly criticised by Australian consumers and the media. Their coffee has been variously described as ‘a watered down product', ‘gimmicky', and consisting of ‘buckets of milk'. These are not the labels you would choose to describe a coffee that aspires to be seen as a ‘gourmet' product. It has also been criticised for its uncompetitive pricing, even being described as â€Å"one of the most over-priced products the world has ever seen† (Martin, 2008).Even the idea of the third place has come under criticism – â€Å"why would you want to sit around a pretend lounge room drinking a weak and expensive coffee when you can go around the corner and have the real thing? † (Wailes, 2008). It seems that Starbucks' rapid expansion, its omnipresence, somewhat standardised store design and recent insistence on staff achieving various sales KPTs (key performance targets) such as serving ‘x' customers per hour, all combined to diminish the instore experience. The introduction of sales targets for front-line employees, for example, meant staff and baristas had less time to engage with customers.It began to stray too far from its roots and the very values upon which the brand was built. Some of these actions were forced upon Starbucks by emerging competitors seeking to imitate the brand, and thus gain a slice of the ever growing lifestyle coffee market. Starbucks' points of differentiation were systematically being eroded and, in a sense, the brand that taught the world that coffee is not a commodity was itself becoming one. 6. 2. Declining service quality The brand has also come under fire for declining customer service as it continued to expand.For example, the quality of baristas is said to have declined as Starbucks widened its pool of applicants in order to meet demand at new stores. Can a 17 year old high school student really compete with a boutique trained barista with a passion for coffee? By not offering a better experience and product than emerging direct competitors, Starbucks found itself undermined by countless high street cafes and other chains that were selling stronger brews at lower prices and often offering better or equal hospitality.Whilst they may have pioneered the idea of a ‘third place', it was an easy idea to copy, and even easier to better by offering superior coffee, ambience and service. Now, with so many coffee chains around, Starbucks have little point of differentiation, even wi-fi internet access has become commonplace across all types of cafe. Furthermore, while customers were offered promotional rewards for returning to Starbucks, the card-based scheme is no more sophisticated than equivalent me-too cards at Gloria Jean's, Coffee Club, Hudson's and many independent cafes.And as noted earlier, one of the things that set Starbucks apart from the competition – i. e. , acknowledging customers (often by name for regulars) within a few seconds of entering the store and seriously engaging with them, began to unravel when Starbucks imposed both customer service and sales targets for its cafes. The imposition of these targets plus an ever widening range an d complexity of coffees to remember and make to perfection, meant staff morale and inevitably customer service levels declined. In fact in the USA some staff were so disillusioned with the imposition of sales targets because it meant they simply didn't have time to engage with customers) they posted blogs openly stating that Starbucks had lost its way. Finally, it appears that Starbucks were not even delivering on their core promise of serving superior coffee in comfortable surroundings, thus justifying its premium price. By switching to vacuum packaged coffee, consumers are denied the store-filling aroma of the coffee beans. The switching of traditional coffee machines to automated espresso machines (which can make coffees 40% faster and move customers through the lines more quickly), has also resulted in a loss of ‘theatre' (Grove et al. 2000) for people wanting to see their coffee made that way and has also had implications for taste. In-store, it has been noted that there are fewer soft chairs and less carpeting, and Starbucks recently lost ground in the ‘service and surroundings' category of the Brand Keys 2007 Customer Loyalty Engagement Index (Cebrzynski, 2008). It seems that Starbucks is now less about the quality of the coffee, and is more about the convenience of faster service and being on every corner – whilst still charging a premium. 6. 3. Starbucks ignored some golden rules of international marketingIronically, it seems that the very thing that made Starbucks successful in the first place, its ability to adjust the original (European) business model and coffee tradition to local (US) conditions, is the thing that let it down. Whilst Starbucks has made minor changes to its menu in countries such as Japan and Saudi Arabia, it generally offers the same products all around the world. When the company came to Australia, it brought its ‘American' offering, simply bringing what worked in the US and applying it here, without rea lly understanding the local market.But with more than 235 ethnicities speaking more than 270 languages and dialects, companies wanting to get ahead in Australia need to be aware that they are not dealing with one homogeneous market. Unfortunately what worked in the US was â€Å"bitter, weak coffee augmented by huge quantities of milk and sweet flavoured syrups. Not so much coffee, as hot coffee-based smoothies†. For the Australian consumer raised on a diet of real espresso, this was always going to be a tough sell (Mescall, 2008) As McDonald's Australia chief executive Peter Bush noted, US retailers that have had trouble making it work in Australia (e. . , Starbucks, Denny's, Arby's, Taco Bell) are those that have â€Å"introduced formulae developed for US palates and for the US way of doing business . . . These formulae have, at best, modest relevance in Australia†. Peter Irvine, co-founder of Gloria Jean's, also noted that â€Å"US retailers often arrive in Australi a thinking the size of their overseas chains and the strength of their brands in other markets will make it easy for them to crack the local market. Their focus is on global domination rather than the needs of the local consumers†.Further, there is a strong sense in Australia of buying local, supporting the community, having relationships with the people you buy from, and supporting ethically-minded businesses. Starbucks clashed completely with that, whereas local stores can differentiate themselves as being local and non-corporate. Furthermore, some would argue that Starbucks has become a caricature of the American way of life and many Australians reject that iconography. Many are simply not interested in the ‘super-size' culture of the extra-large cups, nor want to be associated with a product that is constantly in the hands of movie stars. 6. 4.Expanding too quickly and forcing themselves upon an unwilling public In the US, Starbucks started in Seattle as a single sto re. In a nation bereft of a genuine cafe culture, that single store captured people's imagination, and soon became a second store, quickly followed by a third. Before long, Starbucks had become a demand-driven phenomenon, with everyone wanting a Starbucks in their local area. McDonald's grew exactly the same way in Australia, opening just one or two stores in each city – nowhere near enough to meet demand – thus creating an almost artificial scarcity, which created huge buzz around the brand experience.Krispy Kreme did the same. But when Starbucks opened in Australia, they immediately tried to impose themselves with multiple store openings in every city – adopting the US-model of expansion through store clusters. Australians were not given a chance to ‘discover' it. As Mescali (2008) points out â€Å"they took key sites, hung huge signs, made us order coffee in sizes and gave the coffees weird names. Starbucks said to us – ‘that's not how you drink coffee. This is how you drink coffee'†.They took the Coca-Cola strategy of being available wherever people looked, but this quickly led to market saturation. Their expansion did not hurt their competitors so much as themselves, and they found themselves cannibalising their own stores. Furthermore, by becoming too common, the company violated the economic principles of cultural scarcity and the novelty wore off. By having too many outlets, becoming too commercial and too widely used, it began to lose its initial appeal of status and exclusivity. It began to have a mass brand feel, certainly not the warm feeling of a neighbourhood cafe.Furthermore, they became more reliant on less affluent consumers who now, with a worsening economy, are spending less, making Starbucks more vulnerable to economic fluctuations. 6. 5. Entering late into a highly competitive market â€Å"In America, Starbucks is a state of mind. In Australia, it was simply another player. † Barry Urqu hart, quoted in Delaney (2008) From Day I1 Starbucks got off on the back foot. They lacked the first-mover advantage they had in the US and Asia, finding themselves the late entrant in an already very developed, sophisticated and competitive market.Indeed, the competitive landscape in the Australian retail coffee market is very different to that of other countries. Here, Starbucks found themselves competing with hundreds of independent cafes and speciality coffee chains (see Table 3), where the coffee was generally better and the staff knew their customers by name. Significantly, they were also the last of the major chains to gain a presence in Australia. 6. 6. Failing to communicate the brand Worldwide, Starbucks rarely employs above-the-Iine promotion, and this was also the case in Australia.Instead, they maintained that their stores are the core of the business and that they do not need to build the brand through advertising or promotion. Howard Shultz often preached, â€Å"Buil d the (Starbucks') brand one cup at a time,† that is, rely on the customer experience to generate word-of-mouth, loyalty and new business. But in a market as competitive as Australia, with a consumer whose palate is discerning and whose loyalty often lies with a specific barista, advertising and promotion was essential to communicate the Starbucks message.The issue is not so much about building awareness – which, at 90%, is high – but to communicate what the brand means and to give consumers reasons for patronising Starbucks. Their lack of advertising made this branding issue even worse, with many people unable to articulate why they should be loyal to Starbucks. At the same time, competitors were communicating their messages very effectively – McDonald's, for instance, is a heavy spending, award-winning, advertiser in the Australian market.Added to which, more subversive counter-messages were coming from those who saw in Starbucks a ‘brand bully' ri ding rough shod over the nuanced tastes and preferences of local cultures (Klein, 2000; Clark, 2008). In other words, a range of strong contrary messages were undermining Starbucks' own very limited communications. 6. 7. Unsustainable business model Starbucks' product line is limited primarily to coffee. Sometimes a new product idea will be developed, such as the Frappucino, but these tend to have limited product life cycles and/or are seasonal.For example, the Frappucino has traditionally made up 15% of (summer) sales, but recently sales have been down, suggesting that customers are already bored with it (Kiviat, 2008). Furthermore, in the instance where other products were offered, people failed to purchase them as they only really associate Starbucks with coffee and generally seek food elsewhere. This is a very different model to The Coffee Club which has much more of a cafe feel to it, or McDonald's which has a full range of breakfast and lunch/dinner items that can be complemen ted by a McCafe latte.Hence the average transaction value at Starbucks is lower than its competitors, and therefore more customers must pass through its doors to reach the sales and profit levels of its competitors. It also creates conflict with the Starbucks ethos of the third place (and allowing people to sit around for 30 minutes sipping lattes and reading, talking or surfing) versus the need to get people in and out quickly and not take up valuable ‘real estate' (which in itself means that the average Starbucks store needs to be much bigger than the average cafe).Unlike most of the other retail coffee chains, Starbucks does not use a franchise model, preferring to lease and fit-out its own outlets. This means more cash is being spent upfront, and in Starbucks' case, more debt accrued. But adopting a franchise model would have numerous other advantages than just minimising this. It would mean that local investors, with a good sense of the local market, put their own money i nto the business and take an active role in running it and shaping its direction. 7.What are the main lessons from this case study? Several key lessons emerge that should be of interest to both domestic and international marketers. 7. 1. Crossing international borders is risky and clearly Starbucks did not do their homework, or ignored their homework Well conceived market research involving both primary and secondary data, including qualitative and quantitative approaches, would have uncovered the extent of the ‘coffee culture' that existed in 2000 when Starbucks entered the Australian market.It seems inconceivable that Starbucks management, or at least its Australian representatives, were not sufficiently apprised of the extent to which many consumers were already well acculturated in terms of buying and consuming European styles of coffees such as short black, lattes and cappuccinos, nor the extent to which many customers were in fact loyal to their suburban cafe or competit ive brands such as Gloria Jean's. As a late market entrant, Starbucks clearly failed to do thorough homework on the market before entry – this is a failure in terms of due diligence.Alternatively, they chose to ignore the messages that were coming from any due diligence that they had undertaken. This may or may not have been due to some arrogance on the part of Starbucks, or due to the fact that they considered they had a strong global brand which would meet with universal acceptance. An example of where Starbucks did do its homework, and act on it, was in France when it entered that market in 2006, establishing a cafe in the middle of Paris.Research had clearly shown the American way of consuming and socialising over a coffee was an anathema to many French, so Starbucks held back from entering the French market and when they finally entered it was with great trepidation, expanding at a very slow pace and testing the market at every step. 7. 2. â€Å"Think global but act loc al† This familiar maxim in international marketing should be well understood. While Starbucks had brand awareness as a major global brand, it failed to adapt the product and the customer experience to many mature coffee drinkers in Australia.As noted earlier, all the evidence suggests that it simply tried to transplant the American experience into the Australian market without any adaptation. In particular, it failed to adapt either its core product or its supplementary services to create the intimacy, personalisation and familiarity that is associated with established boutique cafes in Australia. 7. 3. Establish a differential advantage and then strive to sustain it A question of strategy that Starbucks perhaps failed to address was, â€Å"Is our product differentiation sustainable in the long term and does it ontinue to justify a price premium? † As noted earlier, it can be argued that the core product in this case, that is the coffee itself, is essentially a commodit y, and that Starbucks' coffee, according to many consumers, was no different to the competition, and in some cases inferior. Then Starbucks' points of difference clearly revolved around its brand image and supplementary services. It was these supplementary services, such as its unique servicescape and excellent customer service, that they used to justify a premium price. However, as competitors (e. g. The Coffee Club) quickly imitated the ‘Starbucks experience' (i. e. , their supplementary services, ambiance, etc. ), by providing premium coffee and an intimate casual experience, Starbucks' value proposition began to fade. In other words, their key points of difference could be easily imitated and were not sustainable. Faced with this scenario, the onus was on management to re-fresh and evolve any lingering differential advantage that Starbucks might have had or, at the very least, give customers reasons to continue patronising Starbucks through its communications. 7. 4.Don't l ose sight of what made you successful in the first place As more and more competitors emerged, both individual cafes and chains such as Gloria Jean's and The Coffee Club, competitive pressures forced Starbucks to impose rigid sales targets on their frontline staff including baristas to increase store productivity. However, the imposition of these KPTs and the pressure to serve more customers more quickly meant that Starbucks forgot the very thing that made it unique in the early days, namely, to provide a customer experience in an intimate casual setting that set it aside from competitors.As more pressure was placed on staff to have higher throughput, this meant that baristas and other employees had little time to engage with customers. In other words, Starbucks forgot about the very things that made it unique in the first place. This is akin to the Wheel of Retailing hypothesis (Hollander, 1960) where a no-frills retailer gradually moves upmarket in terms of variety of product, pri ce and more services and within several years finds itself competing with the more established premium supermarkets that were the very competitors that they tried to distance themselves from in the first place.The only difference with Starbucks is that it reversed the direction of the Wheel – by gradually moving downmarket it brought itself into direct competition with cheaper operators and lost sight of what made it successful in the first place. 7. 5. Consider the viability of the business model It has to be questioned whether the Starbucks' business model is viable in the long term, or even the medium term. A business model that uses a premium price to justify the excessive floor space and elaborate servicescape, and allows customers to sit in this environment for an hour sipping one latte, has to be questioned.Given that Starbucks do not have the array of products that, say, a McDonald's might have and, as documented earlier in this case, therefore do not generate the sam e sales volumes and revenues, it is hard to see how the Starbucks' model is financially viable. 8. Conclusion In summary, it appears on all the evidence that Starbucks not only misjudged the Australian coffee culture but also misjudged the extent of the competition, and failed to adapt its offering to the local market.Furthermore, with the advent of high quality barista training, the availability of premium coffee beans and the technology to produce a high quality cup of coffee (at a modest cost), sole operators who knew their customers by name, were able to set up business as viable competitors. Starbucks may have been responsible for growing the premium coffee category, but the emergence of Gloria Jean's and the Coffee Club (and McCafe, a premium coffee shop embedded in McDonald's restaurants) turned out to be serious competitors.Finally, questions have to be raised about Starbucks fundamental business model in a market where many small niche players can easily replicate the †˜Starbucks Experience'. References References AustralAsian Specialty Coffee Association, 2006. Australian Coffee Market: Key Facts for 2006. Australian Bureau of Statistics, 2008. Cafes, Restaurants and Catering Services, Australia, Report 8655. 0 for 2006-07. Bawden, T. , 2008. Starbucks reports first loss in 16 years. Times Online, 31 July. (accessed 15. 08. 08. ). BBC News, 2006. China central to Starbucks growth. BBC News, 14 February. (accessed 29. 08. 08. ). Browning, E. 2008. Starbucks hopes growth abroad will save its bottom line. ABC News, 3 1 July, (accessed 29. 08. 08. ). Burritt, C, 2007. 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IKEA India Entry Strategy Essay

IKEA originated in 1943 by a 17 year old Ingvar Kamprad using his entrepreneurial skills selling items out of a catalog and continued to expand where his stores is located in more than 30 countries currently. IKEA sells furniture and other household products at a very low price so that everyone can afford them. IKEA is always looking to save money on their packaging, costs, and any other opportunity they get to save money. As a team we thought it would be most beneficial for IKEA to enter into India specifically Mumbai, India. India is one of the most emerging countries and gives IKEA a great opportunity. As a team we feel IKEA should implement interior designers that help people decide which furniture properly fits in their house hold. The interior designer will be extremely knowledgeable and accommodating when helping people decorate their homes. India is an emerging country with one of the largest democracies in the world. India has one of the largest populations in the World which is a great opportunity for IKEA. One problem with the huge population is the wide array of income ranging from the very wealthy all the way down to the lower class who may work for as little as a dollar a day. The furniture industry in India only consists of .05% of its GDP which is another reason IKEA has a great opportunity to be successful in India. India has a large opportunity for FDI (foreign direct investment) because of the current economic conditions and the rapid growth rate of the country in terms of GPD and other economic indicators. IKEA in India will maintain the original Swedish logo and plans to target people in India in the lower middle class and above. It is estimated that there are between 30 and 300 million people that would fit into IKEA’s target market. IKEA plans to start as one store in Mumbai and expand depending on sales and revenue. IKEA will need to have managers who are experienced help with the opening procedure to ensure that everything is done right. It is essential for IKEA to hire Indian managers and retail  workers as they will be able to make a connection to the guests that foreigners might not be able to make. People of India understand how life works, what people want, and how they do business. IKEA will need to cover all aspects of business in terms of employment from sales people all the way up to top management and everything in between. IKEA must promote and market their opening properly so that people are aware of the store location and what it has to offer. Advertising and promotion is very important for them and utilizing social media could be a large attribute to their marketing campaign. IKEA is going to issue common stock and other aspects of business to ensure that they can afford the transition into India. There are many challenges that IKEA may face in this process, but through careful analysis and marketing research they can overcome any adversity that may come their way. COMPANY OVERVIEW: IKEA was established in 1943 where 17 year old Ingvar Kamprad started a local catalog selling household goods with money that his father had given him. Kamprad ran a very successful business and decided to open selling furniture at a low price. Kamprad established a name for himself becoming very reliable, dependable, and offering a good product at a low price. In 1965, one of the biggest stores was opened where people of Sweden lined up outside the doors waiting for the store to open. Kamprad ran a very successful business expanding globally and penetrated the market in the United States in Pennsylvania in 1985. IKEA is considered to be one of the World’s top furniture retailers generating more than $12 million in profit in 2002. IKEA sells furniture and other miscellaneous products at a very low price allowing numerous people to purchase their products. IKEA sets an initial benchmark in regards to the pricing and then cut the prices by more than 20-50% to ensure guests of all social classes can purchase there items. IKEA understands that only allowing the upper class to purchase their product eliminates a large amount of potential customers. IKEA also tries to attract to college students who are  on a tight budget, but need to purchase furniture for dorm rooms or apartments. IKEA’s mission statement is: â€Å"The IKEA Concept is based on offering a wide range of well designed, functional home furnishing products at prices so low that as many people as possible will be able to afford them. Rather than selling expensive home furnishings that only a few can buy, the IKEA Concept makes it possible to serve the many by providing low-priced products that contribute to helping more people live a better life at home.† IKEA will continue to sell their products at a low price as long as people continue to assemble their own products. A huge difference between IKEA and other leading furniture retailers is that IKEA does not assemble products for their customers which keep their costs low. IKEA is very price conscious and always trying to keep costs down. An example of keeping costs low is the flat boxes they use for their products which minimize shipment costs and also production costs. IKEA managers have been trained to make employees aware of exceeding costs that are harmful to the company such as shutting lights or computers off that are not in use. IKEA currently operates in 42 different countries all over the world, selling products at low affordable prices for everyone. When IKEA began going international they ran into some problems as they did not do marketing research to learn about what the customer wants. An example is in Philadelphia, USA where customers complained about furniture not fitting with the American lifestyle. IKEA scrambled to gather information to regain their position in the international market. IKEA learned a lot of lessons about entering internationally realizing there are many changes that need to occur to succeed internationally. After this mishap in the United States, IKEA developed a marketing research team which has led to their success in the other countries around the world that they entered. IKEA maps there stores out properly to ensure that people spend money while there. They often have furniture at the beginning of the store with a pathway leading customers throughout the store to see everything. If a  customer wants to purchase a particular item they write down the code and give it to the workers in the warehouse. At the end of the journey throughout the store customers also will be given the opportunity to purchase smaller items such as pens, pencils, paper, and other miscellaneous products affiliated with furniture or household goods. This is a beneficial marketing and strategic planning for IKEA to maximize their profits by the layout of their stores. INDIA – COUNTRY ANALYSIS India is the world’s largest democracy and is the second most populous country. It is one of the most diverse nations with numerous cultures, religions and languages. It is taking long strides with a progressive pace in terms of highly improved rate of literacy, health and life expectancy and majority of its citizens have been less affected by poverty, when compared to the past. In the past decade, India has turned out to be a major player in the economic arena. For a while now, it has been growing at a rate of around 8% and is the second fastest growing nation, second only to China. A great amount of credit for this growth is attributed to the policies adopted by the Indian government and the youth, which forms a huge part of the population. With this growth, India is on the brink of a makeshift. It has become a major market for many companies and has paved way for huge corporations to set up their businesses and invest heavily. PESTLE ANALYSIS In business, PESTLE analysis is very important. Originally designed as a business environmental scan, PESTLE analysis is an analysis of the external macro-environment in which a business operates. These are factors which are beyond the control or influence of a business, however are important to be aware of when doing product development, business or strategy planning. PESTLE stands for: P- Political E- Economical S- Social T- Technological L- Legal E-Environmental For businesses to be set up, let us look at the PESTLE analysis of India. POLITICAL India is the biggest democracy in the world. It is a federal republic. The political situation in the India is more or less stable. Most of its democratic history, the federal Government of India has been led by the (INC) Indian National Congress. State politics has been dominated by several national parties including the INC. The Bharatiya Janata Party (BJP), the Communist Party of India (CPI), and various regional parties are the other major players on the Indian political scene. In the 2009 Indian elections, the INC won the biggest number of Lok Sabha seats and formed a government with an alliance called the United Progressive Alliance (UPA), supported by various left-wing parties and members opposed to the BJP. Ideological inclination of political parties, influence of party forums, civil society etc. creates a political environment that promotes stability. In India, many political factors affect the business environment. For example, Bangalore established itself as the most impo rtant IT centre of India mainly because of political support. The major factors that affect the political environment are:- Taxation policy India has a well developed tax structure with a three-tier federal structure, comprising the Union Government, the State Governments and the Urban &Rural Local Bodies. The power to levy taxes and duties are distributed among the three tiers of Governments, in accordance with the provisions of the Indian Constitution. The main taxes/duties that the Union Government is empowered to levy are Income Tax, Customs duties, Central Excise and Sales Tax and Service Tax. The principal taxes levied by the State Governments are Sales, Stamp Duty, State Excise, Land Revenue, and Duty on Entertainment and Tax on Professions & Callings. The Local Bodies are empowered to levy tax on properties, Octroi Tax on Markets and Tax/User Charges for utilities like water supply, drainage, etc. Privatization Privatization reduces the political interface in the management of enterprises, leading to improved efficiency and productivity. India has adopted privatization in a big way. Most of the publicly owned enterprises have now been privatized. For example, a great part of the Indian Railways has been privatized which has improved the quality of service to a great extent. Deregulation After the reforms of 1991, the Indian government adopted a policy of deregulation. It has loosened its control on most industries which has helped the industries grow. ECONOMIC In order to solve economic problems, the government took several steps including control by the State of certain industries, central planning and reduced importance of the private sector. The main objectives of India’s development plans were: Initiate rapid economic growth to raise the standard of living, reduce unemployment and poverty Become self-reliant and set up a strong industrial base with emphasis on heavy and basic industries Reduce inequalities of income and wealth Adopt a socialist pattern of development – based on equality and prevent exploitation of man by man As a part of economic reforms, the Government of India announced a new industrial policy in July 1991. The broad features of this policy as follows: The Government reduced the number of industries under compulsory licensing to six. Disinvestment was carried out in case of many public sector industrial enterprises. Policy towards foreign capital was liberalized. The share of foreign equity participation was increased and in many activities 100 per cent Foreign Direct Investment (FDI) was permitted. Automatic permission was now granted for technology agreements with foreign companies. Foreign Investment Promotion Board (FIPB) was setup to promote and channelize foreign investment in India. The economic factors in India are improving continuously. India has the third highest GDP in terms of purchasing power parity. Foreign direct investment in India rose 13 percent to $50.81 billion in the first 11 months of 2011 from a year earlier. India is a very attractive destination for investing as can be seen below. The Indian Economy is also witnessing a boom in the Retail sector. Almost 60  percent of the consumers are willing to try out new products and services. Around 44 percent of Indians are willing to invest in the stock market as the disposable incomes are going beyond the level of savings. The attitudes and thinking of consumers has also changed compared to the previous year because of a reduction in the dependence on male member or shopper. According to a survey, Indian consumers are willing to spend more on home improvements (38%) and leisure holidays (37%). The Total retail market of India is Rs. 19.48 Lakh Crore of which Rs.0.126 lakh crore is organized. The organized market is growing at a rate of 28% and is expected to touch Rs. 0.206 lakh crore in 2011-12. The organized retail market share to total GDP is 2.1% and to that of private consumption is 3.4%. Organized retail share to total retail market is 6.5%, which is estimated to touch 8.1% in 2012-13. SOCIAL Changes in social trends can impact the demand for a firm’s products and the availability and willingness of individuals to work. In India, for example, the population has been ageing. This has increased the costs for firms who are committed to pension payments for their employees because their staff is living longer. It also means some firms have started to recruit older employees to tap into this growing labor pool. It describes the characteristics of the society in which the organization exists. Literacy rate, customs, values, beliefs, lifestyle, demographic features and mobility of population are part o the social environment. It is important for managers to notice the direction in which the society is moving and formulate progressive policies according to the changing social scenario India is the second most populous nation in the world with an approximate population of over 1.1billion people. This population is divided in the following age structure: 0-14 years – 31.8%, 15-64 years – 63.1% and65 years and above – 5.1%. TECHNOLOGICAL New technologies create new products and new processes. MP3 players, computer games, online gambling and high definition TVs are all new markets created  by technological advances. Online shopping, bar coding and computer aided design are all improvements to the way business is done. Technology can reduce costs, improve quality and lead to innovation. These developments can benefit consumers as well as the organizations providing the products. India, in the past decade, has witnessed a technological growth unparalleled. With the advent of Information Technology, India has become the most favored destination for IT projects. This has helped in creating employment and raised the standard of living of many. Most of the government projects are now been carried out in consultation with private partners who bring in high-end technology. For example, the Bandra-Worli Sea Link project in Mumbai was done in collaboration with a Chinese firm which helped the project technically. LEGAL These are related to the legal environment in which firms operate. In recent years in the India there have been many significant legal changes that have affected firms’ behavior. The introduction of discrimination and disability discrimination legislation, an increase in the minimum wage and greater requirements for firms to recycle are examples of relatively recent laws that affect an organization’s actions. Legal changes can affect a firm’s costs and demand. This consists of legislation that is passed by the parliament and state legislatures. Examples of such legislation specifically aimed at business operations including the Trade mark Act 1969, Essential Commodities Act 1955, Standards of Weights and Measures Act 1969 and Consumer Protection Act 196. ENVIRONMENTAL Environmental factors include the weather and climate change. Changes in temperature can impact many industries including farming, tourism and insurance. With major climate changes occurring due to global warming and with greater environmental awareness, this external factor is becoming a significant issue for firms to consider. The growing desire to protect the  environment is having an impact on many industries such as the travel and transportation industries (for example, more taxes being placed on air travel) and the general move towards more environmentally friendly products and processes is affecting demand patterns and creating business opportunities. India has also realized the importance of these necessities and the government has laid down several norms for companies which they must adhere to if they need to run their businesses. INDIAN FURNITURE INDUSTRY INDUSTRY OVERVIEW The furniture industry in India is considered as a â€Å"non-organized† sector as it represents a small percentage (about 0.5%) of contribution to the formation of GDP. Moreover, the production is increasing every year. The furniture industry is categorized into various categories amongst which handicraft production is the major category which accounts for about 85% of the total furniture production in India. The wooden furniture is the major part of this non-organized sector, which caters mainly to home furniture demand. Demand for household furniture is easily affected by economic conditions such as disposable income, interest rates, employment level and income growth. The total size of the Indian furniture industry is estimated at around INR 900 billion. Eighty five percent of this falls into the unorganized sector. The furniture market is growing by 12-15 per cent per annum. In fact, around 300,000 workers are held by the furniture industry. FIVE FORCES ANALYSIS THE BARRIERS TO NEW ENTRANTS Barriers to entry explain the different criteria that could act possible barriers for companies to venture into new markets. For the Indian furniture market, the following could be the barriers: †¢ Cost of capital requirements The capital required to set up a furniture business could be pretty heavy and companies would have look for investors in order to meet the heavy capital requirements. †¢ Experiences and knowledge Since furniture business, in term of manufacturers and retailers, is considered as a shopping good which needs more time in selection so reputation is significant for the companies. Consistent with Imported furniture in India are booming, design becomes the first criteria in selecting furniture. This is influenced heavily by reputation and strong relation with customers and suppliers. How to begin and maintain the relationship along the value chain will help ensure survival in the furniture business. Developing relationships require knowledge and experiences which can be acquired and collected during operating in the market. This implies that this factor favors the companies already in the market. †¢ Legislation The legal aspect is not much of relevance for India furniture industry in terms of an impediment. Rather, it provides the opportunities of lower tariffs for the new comers. THE BARGAINING POWER OF BUYERS In India the bargaining power of customers in furniture market is high. Most of the time in furniture buying process is spent in looking and shopping products and once consumers decide what to buy, they will buy from retail or wholesale stores. Furthermore, designed furniture increasingly becomes to the furniture trend in Indian market. Product design is mostly in hand of retailers or wholesalers since they meet the need of consumers who come to  their shop therefore they know styles in the current trend. Porter suggests that retailers power become significant greater over manufacturers when they are able to influence consumer’s purchasing decisions. In case of India furniture market, the ability of retailers to shape future market significantly increases the power of the buyers. THE BARGAINING POWER OF SUPPLIERS The power of suppliers is in the same direction as the power of buyers in the sense that it can squeeze profitability out of the industry. Suppliers can use bargaining power over participants in an industry by raising prices or reducing the quality of goods or services. In Indian furniture industry the bargaining power of customers in furniture market is low. The modern design furniture rapidly becomes a furniture trend. Manufacturers produce furniture in various styles given by interior designers or retailers. This can lower the supplier power. THE THREAT OF SUBSTITUTE PRODUCTS OR SERVICES The stronger the substitution in the industry less profitable the industry is. Wooden furniture is the main product in Indian furniture industry. The potential substitution of tropical wood products is the obvious non-wood products. Aluminum or plastic products may be a substitute for wood products. The threat of the substitute aluminum is gradually high since the demand for aluminum product is gradually growing with the current prospects of Indian economic development in the coming decades. To compare with wood the advantage of aluminum is mainly its durability, high flexibility, easy maintenance and no rust. RIVALRY AMONG EXISTING COMPETITORS Rivalry among existing firms can be fierce. For a company to improve its competitive position, knowledge of its industry situation and its rivals is essential. The more the rivalry is intense, the less that industry is profitable. †¢ Number of rivals The competitive environment in India furniture industry seems to be low in the terms of intensity since there are not many companies in the industry. However, foreign competitors through foreign investment play an important role in the industry because of the growing trend of imported furniture. †¢ The industry growth Porter argues that slow industry growth leads to increasing competition since firms in the industry are inevitable to seek their expansion. From empirical findings, we found out that furniture market in India is growing positively every year. This implies that competition in the industry is not likely to be severe †¢ Product differentiation In an industry, product differentiation plays a significant role in protecting from competitors as customers have preferences and loyalty to particular sellers according to Porter. In Indian furniture industry, design makes product differentiated and design rapidly becomes trend. This means competition in this industry tends to be weak as a lot of design options are available which can generate product differentiation to meet the customer’s specific needs. INDIA – A GREAT PLACE TO INVEST India has a very stable political environment which has been suitable for foreign investors and its policies over the last few years have been successful to attract FDI in various sectors This shows that India is a fruitful market for companies planning to invest and enter this market. India is an important member of WTO which urges it to abide by its rules and regulations. India has the second largest population in the world which makes it a huge economy as it also has a rapid and stable economic growth  with low inflation rate and strong rupee value. India also has a cheap labor as compared to other developing countries. These indicators clearly signify India as a suitable place for the investors to invest. We have noticed that imported furniture is flooding in the market and growing up rapidly every year. The government policy of allowing 100% FDI in single brand retail is an added motive and enhances opportunities for foreign players in entering into Indian market. The ability of retailers to shape future market is increasing, however, buyer’s bargaining power is exerted very little as it doesn’t appear to be one single buyer who purchases large volumes of furniture and supplier’s bargaining power is also low as most of products are in hand of retailers in view of product design. Competitive situation in Indian furniture industry is not too intense due to the high growth of the industry and a small number of companies in the industry. 3. IKEA IN INDIA From the previous part, PESTLE and Five-Force analysis shows the great opportunity for the furniture industry in India. This time, with strong global presence and reputation itself, IKEA should really enter India for further profitability, by the large population and supportive business environment. This part we will explain the IKEA project organized in India by site selection and company strategy. IKEA entering India seems to be a quite promising idea, and as a team we have thought of another aspect that could prove to be quite profitable for IKEA. We feel that hiring interior designers to visit people’s homes or apartment building and help them with the process could generate more sales. An experienced interior designer who is knowledgeable can help sell products and also make recommendations for the customers. Many customers who don’t have a good sense of fashion can be left clueless when trying to shop for furniture or other household accessories. The interior designer will have a catalog with them when they make the initial visit, browsing with the customer. The customer has to pay a flat rate for the interior designer and then what ever they want to purchase. By allocating an interior designer IKEA could make more money because sales people have a tendency to push  products on people and create more sales for the company. 3.1 SITE SELECTION According to the India government (2012), India consists of 28 states and 7 Union territories. Each state has a unique demography, history and culture, value and language (India government, 2012). Using this information it is important that the first store implemented into India is essential for further success. Similar to China, India established the Special Economic Zones Acts (SEZs) in 2005 (Rawat, Bhushan and Surepally, 2011). The authors also point out that in investing there, a company will be given a variety of friendly business conditions e.g. incentives and tax exemptions. Supporting by Dohrmann (2008), SEZs will support business and will particularly enhance the competitiveness of export-oriented activities. IKEA might not be a direct exporter, but we see future potential that IKEA could establish the regional factory in India with the centre location connecting Asia and Europe and other branches. There are a number of states that have been part of SEZs, e.g. Andhra Pradesh, Chandigarh, Gujarat, Maharashtra, Tamil Nadu etc. (SEZ India 2012). Our first location or destination for India is the Western part specifically Mumbai, one of India’s most intensive business hubs and residents, locates (Figure X). We plan to settle a store in suburbs which is near Mumbai, possibly between Pune and Mumbai. The reason why we select this district is its favorable business environments which possibly encourage IKEA’s performance immensely. This derived from the advantages of land value, SEZs preferential treatments and Mumbai economy. Land value Real estate and land value are one of main priorities in establishing a new store. Although IKEA might have plenty of capital, we need to ensure the investment will be made in order to continue to be lucrative and profitable.  According to The Economic Times (2011), _’Property prices in the Delhi NCR region have escalated between 10-45% in the last one year.’,_ whereas Mumbai, on the contrary, the land value is subjected to fall 30% and even more as the developer was forced to sell the estate (Thakur, 2011). Therefore, IKEA had better started from less-costly area and when the firm keep progressing well, settling around New Delhi or Kalkatta can really be considered. SEZs Since Maharashtas has become SEZs, it attracts MNEs and foreign investors for certain. Rawat, Bhushan and Surepally (2011) exemplify that Duty free was allowed for import procurement of products and materials for development, operation and maintenance. Also, the company will benefit from many types of tax exemptions, for example, an exemption from export income 50 or 100% (under conditions), from Central Sales Tax, service tax and state sales tax. Therefore, under SEZs Act, it is not only support cost-effective strategy for IKEA but also lead to future investment of the company in the region, for instance, establish the manufacturing site or regional assemble activity. c. Mumbai’s developing economy and increasing population gives IKEA incentive to start business there. Mumbai is renowned as India’s major financial and commercial capitol as generates 6.16% of national GDP (The Financial Express, 2008). Other emerging companies located in Mumbai will establish competition, but also ensure that business continues to grow. Furthermore, it was ranked among the fastest cities in India for business start-up (MMRDA, 2009) which would allow our company to continuously grow. Regarding Demographic data, Mumbai is the largest city in regards to population. According to the 2011 census, the population of Mumbai city was more than 12 million (Figure Xb), (national population, 1.21 billion) and it has been increasing over time (BBC, 2011). Besides, in comparing to other major cities i.e. Delhi, Kolkatta and Chennai, Mumbai represented the  greatest growth over three decades (Figure Xc).

Qué es Global Entry para acelerar paso por control migratorio

Quà © es Global Entry para acelerar paso por control migratorio El paso por el control migratorio para ingresar a Estados Unidos puede, en ocasiones, ser especialmente largo pudiendo demorarse por ms de una hora. Esta molestia se puede evitar enrolndose en el programa Entrada Global (Global Entry, en inglà ©s) que, adems, puede utilizarse con el mismo fin en un nà ºmero limitado de otros paà ­ses. En este artà ­culo se informa sobre quià ©nes se pueden enrolar en el programa, cà ³mo se solicita el ingreso, en quà © consiste el trmite de la entrevista, razones de negacià ³n de la solicitud y quà © es la Global Entry Card. Quià ©nes se pueden enrolar en el programa Global Entry No todas las personas pueden solicitar beneficiarse de Global Entry. Es preciso cumplir con una serie de requisitos, el primero de los cuales es el de nacionalidad o situacià ³n migratoria ya que es necesario estar en una de las siguientes categorà ­as: Ser estadounidense o residente permanente legal en los Estados Unidos.O ser ciudadano de Argentina, India, Colombia, Mà ©xico, Panam, Singapore, Holanda, Reino Unido, Suiza, Alemania  y Corea del Sur. Los miembros de Global Entry pueden beneficiarse de paso de control migratorio rpido en esos paà ­ses, adems de en Estados Unidos. Los canadienses y los residentes permanentes legales en Canad no pueden solicitar ingreso a Global Entry. Sin embargo, gozan de beneficios similares a travà ©s del programa NEXUS  (que tambià ©n sirve para cruzar la frontera terrestre). Adems, son requisitos para obtener la aprobacià ³n de la solicitud de enrolamiento en Global Entry no ser un riesgo para la seguridad de los Estados Unidos y  que la la Policà ­a Fronteriza de Estados Unidos (CBP, por sus siglas en inglà ©s) apruebe dicha peticià ³n. Aunque este programa es principalmente utilizado por viajeros que pasan frecuentemente a travà ©s de las fronteras estadounidenses, à ©sta no es una condicià ³n y, de hecho, puede aplicar cualquier persona que cumpla con los requisitos mencionados anteriormente. En el caso de menores de 18 aà ±os, es necesario el consentimiento expreso de los padres o guardianes legales. Cà ³mo solicitar ser miembro del programa Entrada Global La aplicacià ³n debe hacerse por internet en la pgina web del Departamento de Seguridad Interna. Debe crearse una cuenta para este fin. Si solicitan varios miembros de una misma familia, hay que crear una cuenta independiente para cada uno, incluidos los nià ±os. Adems, debe pagarse $100 en concepto de tarifa o arancel. Este dinero no se recupera en el caso de que la solicitud sea denegada. El pago a de hacerse con tarjeta de crà ©dito o mediante transferencia bancaria. Una vez que la CBP recibe la aplicacià ³n, si la aprueba condicionalmente entonces procede a enviar un correo electrà ³nico a la cuenta previamente creada en el programa Entrada Global citando al solicitante para una entrevista que tendr lugar en un centro autorizado, conocido en inglà ©s como enrollment center. Sin embargo, existe tambià ©n la opcià ³n de que una vez que se ha recibido comunicacià ³n de la aprobacià ³n condicional la persona beneficiada opte por lo que se conoce como enrollment on arrival. Esto es, la entrevista tendr lugar una vez que se llega a un aeropuerto a Estados Unidos. La à ºnica condicià ³n es que la llegada tenga lugar a travà ©s de un aeropuerto autorizado para realizar este tipo de gestià ³n. Quà © esperar de la cita en la CBP El solicitante para ser enrolado en Entrada Global deber presentarse a la hora y en el lugar indicado presentando dos formas de identificacià ³n. Los ciudadanos mostrarn sus pasaportes no expirados y los residentes sus tarjetas de residencia. Adems, ser necesario llevar otro I.D. como por ejemplo la licencia de manejar. Al ser entrevistado se tomar una foto y las huellas digitales del solicitante que se cotejarn con las bases de datos disponibles para al gobierno de los Estados Unidos. Por quà © puede ser denegada la peticià ³n Las razones por las que la solicitud para beneficiarse del programa Global Entry puede ser negada son varias, destacando entre ellas, las siguientes: La informacià ³n que se da en la aplicacià ³n es falsa o incompleta. Esto serà ­a un fraude de ley y darà ­a lugar a incontables problemas seriosEl solicitante est siendo investigado por una autoridad americana, federal, estatal o localHa violado en algà ºn momento leyes de inmigracià ³n, aduaneras o de agricultura en cualquier paà ­s. No es admisible para entrar en Estados Unidos en aplicacià ³n de las leyes migratorias (esto aplica sà ³lo a extranjeros, incluidos los residentes permanentes)Ha sido condenado previamente por un delito o est en bà ºsqueda y capturaLa CBP no puede verificar todo o parte del historial laboral, criminal o de residencia del solicitante y, por lo tanto, no se cumplen con el requisito de demostrar que no se es un riesgo bajo para la seguridad de los Estados Unidos Quà © pasa si la solicitud de Global Entry es aprobada A partir de ahà ­, cada vez que ingrese a Estados Unidos en vez de hacer fila y esperar su turno para ser procesado por Inmigracià ³n podr dirigirse directamente al kiosko de Global Entry, pasar el pasaporte y poner sobre la mquina sus dedos para que se le tomen las huellas digitales. Es en este momento cuando se cubre en el kiosko la declaracià ³n de aduanas, tambià ©n conocida como formulario 6059B. Y automticamente se le emitir un recibo con el que ya puede ir a recoger su equipaje y proceder hacia Aduanas, donde se puede ser sometido a inspeccià ³n para controlar si trae algà ºn artà ­culo cuya entrada est prohibida en Estados Unidos. Adems, todos los extranjeros que no son residentes permanentes legales en Estados Unidos deben notificar en persona en un centro de registracià ³n de Global Entry todos los cambios que pueden afectar a sus visas, como por ejemplo, la solicitud de renovacià ³n o de peticià ³n de otro tipo de visa. Si no se hace, puede haber problemas al llegar a Estados Unidos. A pesar de estar enrolado en este programa, es posible que en ocasiones la persona deba pasar controles inmigratorios adicionales. Adems, si abusa de este programa sus privilegios pueden ser cancelados automticamente.   Opciones a Global Entry para acelerar cruce del control migratorio Y por à ºltimo, conviene tener en cuenta que este programa aplica cuando se ingresa en Estados Unidos por aire y a travà ©s de uno de los aeropuertos en los que est en funcionamiento el programa de Entrada Global. Pero hay otros programas de cruce rpido de control migratorio como por ejemplo APC para estadounidenses y para ciudadanos del Programa de Exencià ³n de Visas (chilenos, espaà ±oles) o  SENTRI para paso terrestre o marà ­timo entre Estados Unidos y Mà ©xico y su equivalente Nexus para el paso terrestre entre USA y Canad. Finalmente,  destacar que todas las personas que son miembros de Global Entry pueden participar en el programa TSA Pre que permite acelerar el paso por el  control de seguridad en los aeropuertos  de USA para vuelos domà ©sticos y tambià ©n internacionales con origen en los Estados Unidos. Quà © es la Global Entry Card Es una tarjeta que se puede emitir a los miembros del programa Global Entry y que adems son ciudadanos de los Estados Unidos, residentes permanentes en este paà ­s o ciudadanos mexicanos. Para obtenerla es necesario entrar en el sistema de GOES donde se inicià ³ la aplicacià ³n para el Global Entry y seleccionar la opcià ³n  ¨activate membership card ¨.   La tarjeta contiene un chip con informacià ³n sensible y puede utilizarse para ingresar a Estados Unidos por un puerto marà ­timo o tambià ©n por una frontera terrestre utilizando las lineas designadas para SENTRI en el caso de frontera sur con Mà ©xico o para NEXUS, en el caso de frontera con Canad o para Ready Line, reduciendo asà ­ los tiempos de espera para cruzar. Este es un artà ­culo informativo. No es asesorà ­a legal.