Using the European Marketing data and Statistics reference book from the library, I managed to get data for the sources of data for a quick analytical research for setting up a chain of sports shops in Luxemburg. I focussed on:
- Population
- Fashion
- Currency
- Rainfall
- Age-distribution
Population: if JD is to sell a pair of Nike trainers in Luxembourg, I need to research on the current population growth. The current population of Luxembourg is 43 million. JD sports wants to sell its trainers in Luxembourg; it will need to research on the current population there. If there is a high population in Luxembourg, then JD must sell the correct quantity of trainers.
Population 1999 Luxemburg 429,000 UK 5,9279,000
Fashion – Sports Goods: Luxembourg’s fashion is very similar to that of Western Europe’s in general, but is at the same time unique. Luxembourg’s people are of French, German. Fashion in Luxembourg is similar to the trends in Europe.
Luxembourg’s weather conditions would need to be looked at to find the right time of year to sell trainers. Because Luxembourg experiences the same type of cold winter in the UK, so Luxembourg people will need trainers to keep their feet warm. Here, I looked at the retail outlets in Non – Food Specialist Retailing statistics for 1999.
Sports Goods Luxemburg 2 UK 3997
Currency: The Euro is the official currency of the EU. Now that Luxembourg has adopted the Euro, JD sports can consider selling its trainers. Trainers are not that expensive so they should have little problems selling its trainers there. The currency in the EU needs to be compared with foreign currency like the UK pound. When products are being sold in countries with different currencies, there may be a change on the value of the currency that determines the costs of that product. To do this they need to calculate the equivalence of the cost of trainers being sold at Luxembourg.
Currency Luxemburg - Luxemburg Franc, at Belgian franc (LF=100 centimes)
United kingdom Pound Sterling (#=100 pence)
Rainfall: selling trainers in a place where there is a lot of rainfall can be beneficial to JD sports. Luxembourg has an annual rainfall average of 782.2mm / 30.8. Trainers being sold in Luxembourg would be ideal because of the waterproof material. But not a lot of people in Luxembourg would wear trainers. Most people would wear Wellington boots during rainy days.
Age distribution: age distribution is important so that the company can determine the minimum age the product will be suitable for. Looking into the Luxembourg culture, it can be useful for being able to find an estimate of the exact age of the people JD will sell its trainers to.
In 1999 16 - 64 years Population Forecast 2004 Luxemburg 304 UK 39605
0 -14 years Population Forecast 2004 Luxemburg 86 UK 11172
Once JD has sold a variety of clothing and sporting equipment, the business will need to look at the amount of products that it had sold. Statistics is used to present numerical sets of data. As a business, JD could use this method to find out how many of its customers have purchased its goods in Luxembourg. To help in its statistics JD can look at the population growth at to how many customers have purchased goods in both the UK and in Luxembourg.
UK businesses use statistics to help them know how much profit they lose and make. This would be important so that the business can look at the amount of goods it has sold and so it knows where it stands.
Businesses in the UK and the EU need to know this so that it can concentrate on surviving and making a profit. JD seems to be well known for selling its sports products in the UK.In Luxembourg there might be a difference to this because of its cultures, customs, population and other parts of national data.
EU Enlargement
The EU is currently in the process of expanding its membership from the existing 15 to 25 in May 2004. Two further countries are negotiating to join by 2007. The enlargement countries consist of many of the former Soviet Bloc countries of central and Eastern Europe as well as Cyprus and Malta.
Candidate countries must meet a set of criteria, called the 'Copenhagen Criteria', before negotiations on their membership can commence. These criteria are:
To be a stable democracy, guaranteeing human rights, the rule of law and the protection of minorities
To be a functioning market economy
To adopt and implement the body of EU law
The EU consists of 15 Member States, with 10 New Member States due to join in May, 2004. Map courtesy of www.theodora.com/maps used with permission.
The Consequences of Enlarging the EU
Enlargement of the EU is not a new concept, for instance, Austria, Finland and Sweden only became members in 1995. The issue that concerns most in this next wave of enlargement is the economic disparity between the existing and new members.
Advantages
Economic growth. Enlargement will generate economic growth in both existing and member states: in the new states the reform of economic systems to a market economy will generate increased productivity and efficiency and allow them to be able to take advantage of the Single Market through increased trade; in existing states as trade and investment opportunities increase with the new states.
Estimates suggest that job totals could increase in existing member states by 300,000.
Stability.
Membership of the EU will bring with it political stability to the new democracies of Eastern Europe as they reform their legal and government institutions as part of the accession process.
Such stability is important in generating investment not only from within the EU but from outside it, thus contributing to further economic development.
Global Presence. The EU will have a stronger global voice, as its enlargement will bring the population to over 500 million (more than the USA and Russia combined), so giving more weight in international negotiations such as trade policy.
Business Confidence. Companies in existing Member States will have more confidence with those in the new Member States, as they will be operating on a level playing field in terms of EU legislation. Again, business confidence is an important factor in generating investment and encouraging enterprise and initiative.
Foreign Direct Investment (FDI). Membership of the EU and the euro will increase the amount of Foreign Direct Investment in the New Member States.
Structural Funds. The regional aid which attempts to redistribute funds from the wealthier regions of the EU to the poorer ones will be made available to the New Member States. This will help develop these countries and improve infrastructure. Improvements in infrastructure will again be a benefit to trade and in theory, all countries involved will benefit - the applicant country from improved internal infrastructure and the existing states from the extra revenues earned from new trade.
Disadvantages
Migration. Enlargement could produce high levels of migration as workers move from the new member states such as Poland where unemployment is high at 16.7% to those existing member states where it is low such as the Netherlands at 3.6%. Workers will be able to move freely as the EU operates on the principle of the Single Market - one of the 'four freedoms' inherent in the Single Market is the free movement of labour.
Common Agricultural Policy. The controversial Common Agricultural Policy will be extended to the new member states, many of which have predominantly rural economies. The CAP includes measures such as subsidies and income guarantee schemes for farmers, which could prove to be hugely expensive if extended and a drain on the economies of member states.
Regional Aid. The difference in GDP per capita between the existing member states and the new member states is stark. This is also reflected in the ranking of each set of countries in the UN Development Programme's Human Development Index (HDI), which combines indicators of life expectancy, education, literacy and GDP. This difference in wealth and standard of living could be another drain on existing member states in two ways - firstly, existing member states may need to contribute more as the demand for regional aid increases, and secondly, existing member states currently receiving regional aid such as Spain and Greece find their aid reduced as money is channelled elsewhere.
EU Standards and Systems. There are concerns that some New Member States will not have the necessary standards and systems in place, e.g. in meeting standards in food hygiene, and regulations on agricultural production. Meeting environmental standards may be too high a cost for some, while bringing public services up to standard will mean increased taxation for many citizens of the New Member States.
The Legacy of the Soviet Economy.
In some of the states of the former Soviet bloc, certain areas of industry may not have had time to catch up with those of the EU and find they are forced out of business when these countries join the Single Market.
