DeBeers Case

China is the seventh largest country in the world. Apart from this credential it has a large population which offers a diverse opportunity for the culture of different nationalities to thrive there. In addition, it has English as its main language together with 15 other different languages. Its political nature is stable for any business to thrive.

India has an economy that is diverse that consists modern techniques of agriculture, traditional farming methods and other services such as the manufacturing processes.

Agricultural industry and activities are equally flourishing. The industrial sector includes chemical, food processing, steel, transportation equipment and mining.

China is also the leading exporting country. Its exports include petroleum, textiles, engineering chemical goods and many others. The service sector comprises of information technology, the outsourcing of business procedures, retail, telecommunication and even distribution. The language that is used in India foe business is English, which makes it easy for foreigners to communicate with the natives. The cost of the employees in India is low which serves as an advantage since most employees in other countries of the world are a bit expensive. Economists often rely on the gravity theory of trade flows which points out that there exists a constructive affiliation between the size of the economy and trade and a negative relationship between distance and trade. (Mining Journal, 1962)

Distance between two countries can manifest itself in four main scopes that include: administrative, cultural, economic and geographic dimensions. The varied scopes of distance influence the business in different ways.

CULTURAL ATTRIBUTION OF DISTANCE:

A country’s cultural attributes establish the way in which interact with each other and with other spheres of the society such as institutions and companies. Differences in religious beliefs, social norms, race and language are capable of creating distances between two countries. All other things being equal, trade between the countries that have a common spoken language when doing business is thrice the countries that do not share a common language. (Wallis, 1991)

Some cultural norms like language are easily perceived and understood unlike social norms which are deeply rooted and are of unspoken principles which guide the individuals in their daily choices and habits which are invisible, are more subtle.

Cultural traits make or create distance when it influences the customers’ choices make between surrogate goods due to their preference for specific features.

Sometimes products can touch a deeper nerve, triggering associations related to the consumer’s identity as a member of a particular community.

Example is the food industry where it may be sensitive to religious views. The Hindu does not eat beef because it is expressly forbidden in their religion.

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