What Are the Elements of Italian Luxury Excellence That Can Be Utilized in Other Industries and in Different Cultures and How Could the Integration of Italian and American Cultures Create More Effective Business Models?
“Set to move onto a slow, but steady, path of economic growth;” Italy, at first glance, seems to be a promising business environment with projected increases in GDP per capita in the coming years, according to Business Monitor International. However, there are many cultural, administrative, geographic and economic differences that make the business environment much different than that in the US. Generally dominated by domestic carmakers, mainly Fiat S.p.A., the auto industry in Italy doesn’t look very appealing for new firms because of the high barriers to entry.
Of course, you’re still expected to show up on time. In the U.S., cordiality is important, but most companies prefer to get down to business right away. For Italians on the other hand, closing sales is never the main focus of interactions; instead, building a close relationship with future customers is key. Many initial meetings take place at restaurants over lunch.
In fact, the economic struggles reduced business and consumer confidence in the country. This factor has a negative impact on Ford’s operations in Italy. With a declining demand for automotive products and reduction in industrial production, Ford would suffer huge losses of the company ventures in Italy in 2013. The general economic performance in Eurozone affects consumer spending. This is attributed to the increasing unemployment rate. Ford manufactures high quality products, and consumers in Italy cannot spend money on expensive automotive. Italy’s position in international competitiveness has been deteriorating since the year 2011 (Smeral 8). The fact that the country has lost at least 20% of the market share in international exports is discouraging. In this respect, Italy has avoided conducting business with countries that do not pose competitiveness in terms of costs and price change. Such countries include Germany and the United States. In this regard, it would not make economic sense to have Ford’s venture in the Italian market.
Their dominant exports were: clothing, shoes, food, and wine. The industrial north was dominated by private companies, a less developed, welfare-dependent, agricultural south, and had a high number unemployment. The imports cost $389.2 billion, and the cost of the exports was $454.6 billion.
Lane, R. Philip. “The European sovereign debt crisis.” The Journal of Economic Perspectives 26.3 (2012): 49-67. Print.
Smeral, Egon. “The impact of the financial and economic crisis on European tourism.” Journal of Travel Research 48.1 (2009): 3-13. Print.