Each business strategy aims to increase profits and maintain competitive advantages. However, external environmental changes caused by factors such as free trade agreements are forcing the economy to change. This shows Gerald Watts` argument that a company can compete in changing environments if it is able to adapt and grow more demand for their product. But the question is what should marketers do. The answer is strategy. Before choosing a strategy, THE SWOT analysis is applied to check the strength, weakness, treatments and the possibility of knowing their internal and external situation. For example, analytics distributor SWOT will discover that free trade agreements can create more demand (opportunities) and more and more competitors (traits), which shows that the business needs to grow to maintain the market. Many believe that free trade agreements are only about the international trading environment. The free trade agreement has implications for the entire business environment, both international and local businesses. The Free Trade Agreement Increases Competition in the Market For example, Catton-on East Australia Company has been affected by the free trade agreements of new overseas competitors that aim for the same segmentation as UNIQLO and H-M.
So if we apply SWOT analysis (strength, weakness, opportunity, features), a free trade agreement creates opportunities and characteristics for the entire business environment, and in this case, the company will automatically force to reorganize its marketing strategy and plan to turn features into opportunities for the business. Pakistan and China have a long-standing cordial relationship. To extend these relations, a free trade agreement was signed in 2006 and came into force in 2007. This study examined the impact of this free trade agreement on the models of goods traded by the two countries. The before and after analysis shows that trade patterns have generally improved (Pakistan exports and imports from China have increased), but Pakistan`s trade deficit has also increased; The revealed Comparative Advantage (RCA) and SWOT analysis shows that there is a difference between the products traded by the two countries on the world markets and bilaterally, with the exception of the best products. Conversely, Pakistan`s GDP does not have much impact on its exports to China. As a result, under current conditions, Pakistan benefits more from bilateral trade, with exports to China positively correlated with China`s GDP, which is growing faster than Pakistan`s GDP. Recently, Australia sighed Chian – the Australia Free Trade Agreement (ChaFTA), which will come into force on December 20, 2015. The Free Trade Agreement (FTA) is a formal agreement of two or more countries to remove trade barriers between countries such as export and import duties. Its objective is to create benefits for members, such as new ideas and technologies, increase the availability of supply, increase investment, encourage innovation and increase product requirements.
ABC news. (2015). China-Australia Free Trade Agreement: Pros and Cons [online] Available at: www.abc.net.au/news/2015-06-17/china-australia-free-trade-agreement-pros-and-cons/6553680 [access 21 July 2016]. What we can learn from the free trade agreement is that the external business environment is changing and it can create the opportunity and characteristics for the company, hence an appropriate application of the marketing strategy to develop, to play an important role in the life of business. And distributors need to be proactive in continuously analyzing the external and internal environment.