The criteria for choosing office criteria for entering manufacturing location are different from the nies a foreign market. than focusing on costs alone, com should consider both qualitative and quantitative factors. Two key qualitative factors are workforce quality and company strategy. Workforce quality is important because it is often difficult to find workers with the specific skills, abilities, and experience that a company needs to run its business.Workforce quality is one reason that many companies doing business in Europe locate their customer call centers in the Netherlands. Workers in the Netherlands are the most linguistically gifted in Europe, with 73 percent speaking two languages, 44 percent speaking three lan- guages, and 12 percent speaking more than three. Of course, with employees who speak several languages, call centers located in the Netherlands can handle calls from more countries and generally employ 30 50 percent fewer employees those located in to other parts of Europe.
A company's strategy is also important w choosing a location. For exam a company g a low-cost strategy may need plentiful raw materials, low-cost transportation, and low-cost labor. A company pursuing a differentiation strategy (typically a higher-priced, better product or service) may need access to high-quality materials and a highly skilled and educated work force. Quantitative factors such as the kind of facility being built, tariff and nontariff barriers, exchange rates, and transportation and labor costs should also be considered when choosing an office/manufacturing location.
4.3 Minimizing Political Risk global business, they envision b When managers think about political risk in g dramatic factories in the streets Although events such as these receive face and riots and extended coverage from the media, the political risks that most companies the usually not covered as breaking stories on Fox News and CNN. Nonetheless, are negative consequences of ordinary political risk be just as devastating to com can that to identify and minimize that risk.
When conducting global business companies should attempt to identify types of political risk political uncertainty and policy uncertain Political uncertainty is associated with the risk of major changes in political regimes that can re from of political leaders, social unrest, or other influential war, revolution, death events. Policy uncertainty refers to the risk associated with changes in laws and government policies that directly affect the way foreign companies conduct business.