3rd Bac - Geographical Zone

https://www.youtube.com/watch?v=t15N3kdB0lI&t=45s&ab_channel=Edumecate 

Geographical Zone 

 

The geographical delimitation of the entrepreneurship is important to know the economic, political, social and cultural characteristics of the territory where the new business will work. These characteristics will help the entrepreneur to define the general strategy and business marketing.

 

Geographical Delimitations

To have knowledge about the geographical zone where the entrepreneur will establish the new business leads to understanding the characteristics of the business environment. These are external conditions of change, driven by technological, economic, social, natural, institutional and political forces. If these forces are studied well, they will provide key information at the moment of decision making.

 

Territorial Economic Variables: Whether the market is in the national or international territory, the entrepreneur must be aware of what happens. Some variables are:

-       The income of the population 

-       The level of increase of the prices registered

This must be done to have a clear idea about the characteristics and the price of the good or service.

 

Territorial Social Variables: The social variables must also be taken into consideration when deciding about the good or service, these variables are:

-       Employment levels

-       Poverty

In territories with high unemployment rates or high levels of poverty, the purchasing power of the population will be low. Therefore, the demand for expensive products will be reduced. Facing this reality, the entrepreneur must create a product for the population. Another important factor is the safety levels.

 

Territorial Politic Variables: when in a geographic zone there are high levels of uncertainty by government decisions the business will be affected.

-       Laws

-       Public Politics

 

Territorial Cultural Variables: The variables that help to explain the customs and traditions that are behind the cultural profile of a determined territory are other informative elements that the entrepreneur must consider before starting a new business. 

-       Customs

-       Traditions

It is not the same to sale a product in Ecuador than in Colombia, Japan, France, Canada or other country. As well as inside the country, it’s not the same to sell a product in the Sierra region than in the Coast, Amazon and Galapagos. 

This is because the population of a certain geographic zone, seen as a social group have their own behavioral characteristic, that they have been building for a long time. 

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