Wednesday, November 30, 2016

OPEC Reaches Deal to Cut Oil Production
OPEC reaches a deal to cut Oil production by 1.2 million barrels a day, which will represent approximately 1% of global production. The goal from the reduction in oil production is I raise the price of oil to approximately $ 55 to $60 a barrel. This will help to improve petroleum dependent economies, which have been suffering over the last two years. This agreement will help to implement a cartel with the oil producers. OPEC has no released which countries will reduce their oil production and by how much, but Iran has implied they would be willing to reduce production in early 2017, but would not agree to stop increasing production in the short run. Indonesia suspended their OPEC membership on Wednesday. While Teheran, is nearing an agreement to reduce oil production3.97 million barrels a day by early next year. A key demand from Saudi Arabia is that OPEC members use independent estimated of their production as a baseline for their cuts. Iraq is using independent estimated of its output at 4.55 million barrels a day, but is only willing to freeze that level but not cut production completely. This is somewhat promising for the oil industry if it actually pans out. If oil production is reduced by many of the OPEC member, price of oil will increase and economies can start to recover. On the other hand, with some members only agreeing to freeze production, how will this help to improve the long run? How long will they freeze production? Will we be back in the same position within a year if they only freeze production for a short period of time?

Monday, November 28, 2016

How Amazon Gets Its Holiday Hires Up to Speed in Two Days

By Laura Stevens                 

Updated Nov. 28, 2016 9:12 a.m. ET 
An employee at the Amazon shipping center in Schertz, Texas. Photo: Robert Daemmrich Photography Inc/Corbis via Getty Images             

            To prepare for the holidays, Amazon is using technology, like touch screens and robots to quicken the time it takes to train new hires. Unlike other warehouses who typically spend their first days in classrooms training. Amazon trainees get hands-on training as early as their first day on the job, which has proven to be a big advantage in getting them up to speed. This has diminished the time it takes to train new hires to as little as two days, compared to six weeks. This shorter training period saves Amazon money, and could give the company room to offer higher wages as it adds 120,000 temporary workers to its warehouses in the months of November and December. These workers can stay on from six weeks to three months into the New Year to drive forklifts, pick orders or deliver boxes.
           Orange, pallet sized  robots that move faster than humans carry shelves full of merchandise to stations where workers can reach them, and screens show workers what the item looks like and where it can be found. On the warehouse floor, they learn how to pack up shipments, coached by a screen  that tells them which box size to use and automatically prints a piece of tape to fit it. Amazon is also planning to increase the number of full-time staff it employs. It kept about 14 percent of its seasonal hires last year. This year alone, Amazon has built 26 new warehouses, bringing its world-wide total to 149. Small differences can make a big difference in a warehouse's efficiency. It also helps that Amazon's warehouses are fairly uniform, the company can introduce the same training programs across its buildings and multiply any efficiency gains.

Sunday, November 27, 2016

Department Stores Lure Black Friday Shoppers With $19.99 Women’s Boots


When we think of Black Friday, we think of people clamoring outside of electronic stores such as Best Buy to get that rock bottom price on a new TV.  The electronic store chains have been wildly successful in drawing in customers with amazing promotional pricing for a very coveted item.  Now department stars may have found their similarly compelling product and pricing as Belk Inc. in partnership with Kohl’s, Macys and JC Penny is promoting a “Door Buster” price on a ladies boots starting at $19.99.  Price promotions can be a very powerful tool to attract customers in to purchase other items.  ES Originals Inc. a shoe importer actually came up with the idea of the $19.99 boot. Their CEO explains that “When a lady can walk in with a $100 and buy five pairs of boots, they are going to recognize this as a good deal”.  The company is fine recognizing these boots as a loss leader. The intent is to attract the customers to the store so they purchase other items.  The interesting international component of this story is that the boot makers are located in China.  In order, to help drive down the costs of the boots so that they could be sold at $19.99 ES originals CEO made several agreements with the manufactures.  The first being that he would have the boots made in the manufactures off season and store them in his own warehouse.  Also by buying one big bulk order for all the retailers ES originals was able to get further cost concessions.  The $19.99 boot deal has been running for several years now and with is continued success there is no end in sight. 

Chinese Tech Giant Huawei’s Latest Smartphone Faces Frosty U.S. Reception


Huawei a Chinese technology giant, is looking to enter the US Smartphone market by launching its new high end Mate 9 smartphone to US consumers in January 2016.  However, many business analysts are skeptical as there are several key factors which are major obstacles blocking the companies path to success in the US market.   One reason is that US carriers such as AT&T, Sprint etc. who distribute a large portion of the smartphones sold in the US are reluctant to work with Huawei because of its lack of brand recognition with in the US.  As our international marketing book points out in several chapters being able to ensure your product is recognizable on a global scale is a major key to success.  Additionally, another inhibitor is that in 2012 a congressional report suggested that US carriers avoid using Huawei gear in their networks due to fears that China could use the installations to spy on the US. Huawei has vehemently denied this accusations saying they operate independently of the Chinese government, however marketing strategy has not convinced potential partners that there is no risk.  Huawei is the third largest maker of smartphones in the world behind Apple and Samsung and in order to supplant Apple and Samsung Huawei must find a way to penetrate the US market.  Their initial approach makes sense, they are starting with online retailers such as Amazon etc. and targeting the high end market first to help build brand recognition.  Over time as political tensions ease and it finds a suitable partner in the retail space Huawei may be able to become a player in the US market however, that seems a very distant time from now.  

Saturday, November 26, 2016

A label that says ‘light’ reads ‘less tasty’ to most consumers, a new study finds

"Consumers might be demanding more low-fat food, but new research suggests that
perhaps they’d be better off not knowing they’re eating it."
In recent year , health issues related to food brough up awarness to the consumers. In order to reach more consumers. companies started to market "light", "low fat", "reduced fact"products. All of these seem to be more appealing to comsumers who pays attention to what they eat. However, looking back in time, "healthy" food were know for less or no taste. 
All these companies labelling the products with "healthy" labels noticed a change in the buying habit of the connsumers. "no sugar added", more or less everybody likes the taste of sweet food compered to non-sweet, even if both products have the same components, the label will push away "taste oriented" consuers, it is psychologic.
In this article, researchers found that "further research is needed to identify how labels affect what people actually choose to buy and eat.
When marketing a product it is important to set a fix target market. Are we targeting "taste oriented" consumers r " health conscious" consumers? Each target market has to be reach differently. We cannot have a "fit all" marketing plan.
Consumer behabvior is an important part of the marketing research. It enable the company to clearly difine their target market and set up a marketing plan that will appeal to the specific group. 

Small Businesses Lament There Are Too Few Mexicans in U.S., Not Too Many

Small Businesses Lament There Are Too Few Mexicans in U.S., Not Too Many

Michelle Arreguin

Nov. 24, 2016 5:48 p.m. ET

The United States is currently going through a Mexican employee shortage. Companies are finding it harder to fill positions due to the fact that there are less and less low skilled workers. The construction and agriculture business are the ones suffering the greatest impact. The roofing company King of Texas Roofing Co. are stating that Americans complain about Mexicans taking their jobs but they do not want to step up. No one wants to take outside jobs because they feel greater than that. However, they are quick to complain and state that Mexicans are taking over. Now that the shortage is happening companies all over have started giving their employees many incentives for them to continue working and bring more family into the business. They have raised wages to $20 or more an hour, offering bonuses for referrals of more employees, and provide free English Courses. Mexicans have said that they are leaving because of the Trump elections. They are afraid what may happen to them once he steps into the presidency. Others have stated that crossing the border has become more expensive and dangerous. The price they are being charged is ridiculous and they are given drugs to bring across or else they cannot come with them. Mexicans are becoming more afraid and deciding to stay home and work in the farms and stay with their families. This is definitely going to cause a decline in the economy. The economy in the United States depends heavily on these employees to get certain jobs done and without them companies are having to close or being built smaller. Before finding people to fill these positions was easy and now it has become a full time job finding people to work. Immigration needs to be controlled different and give people more reason to stay. People especially Mexicans need to be let know that they do not need to flee. That in fact they are part of our workforce and we need them for things to get done. We need to fill positions and they aren’t just taking jobs they are bettering the work force. If Mexicans leave then where will the companies that need them the most end up.  

Friday, November 25, 2016

Ferrero Reaches Deal to Buy Some United Biscuits Brands

Jars of nutella hazelnut chocolate spread, manufactured by Ferrero, on a shelf inside a U.K. supermarket in 2012.

Tuesday, November 22, 2016

Chinese Web Users Prize Offline Marketing

Chinese Web Users Prize Offline Marketing

Face-to-face efforts are crucial for Airbnb and other foreign Internet companies

By Li Yuan

For online businesses in China to be successful they must be successful offline as well. This is a challenge Airbnb is currently facing as they ramp up their Chinese operations. Companies end up becoming more successful through physical world marketing and support rather than apps or websites. In China, web users are less trusting of new internet services and need more information about them making face-to-face marketing more effective. This is also highly desirable as China's labor costs remain relatively low. " In China, online and offline are equally important for a business, be it sales, quality control or customer management." Says Zhuang Hai. Distributing membership cards, setting up staff through out the city to answer questions, personal selling, and/or having retail sales channels are all ways companies have had success in China. Airbnb may need to invest in hosts in China to upgrade dingy and in poor condition rooms and homes for travelers. Another challenge for Airbnb is to maintain traction in China. eBay is an example of a company that gained a lot of traction, but lost momentum to local rivals. Regulation is key to extending success, requirements can vary from city to city. Airbnb's local rival has memorandums with 200 cities, while Airbnb has only signed 4.  Airbnb has acknowledged that China is a difficult market, but they are confident they will be able to succeed in the country.