Eat2Eat

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  • Topic: Lorenz curve, Gini coefficient, South Korea
  • Pages : 1 (338 words )
  • Download(s) : 107
  • Published : December 11, 2012
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* What are some of the key demographic characteristics (e.g. education, income, age, life expectancy, etc.) of your country? How do you think these characteristics would impact the demand for the new coffee shop?

To start a company in South Korea, at first we need to know this country’s economy situation. The GDP per capita in South Korea is $32100 in 2011, and the distribution of family income (Gini index) was 31 in 2010. GDP per capita could show South Korea citizens’ income. The current GDP $32100 and is ranked 30th in this world, which means South Korean people have enough money to afford coffee, so the coffee demand in South Korea may not influenced by the price so much. The Gini index is a standard economic measure of income inequality, based on Lorenz Curve. A society that scores 0.0 on the Gini scale has perfect equality in income distribution. Higher the number over 0 higher the inequality, and the score of 100 indicated total inequality where only one person corners all the income (Business Dictionary). (http://www.businessdictionary.com/definition/gini-index.html) 31 Gini index is a good signal that means that the South Korean society is more stable and has equality, thus it is good for investment. South Korea has $524.4billion imports in 2011. This shows that South Korea is a tradable, friendly, country and the costumers are likely to accept their product, thus it would be easier for White River Coffee Company to set their company in South Korea. The urban population is a very important factor for this event. The urban population in South Korea is 83%, which is a really high rate. High urban population means more potential costumers so people who live in the country side may not purchase as many coffees as people who live in cities, because people who live in the cities tend to be more stressed and as a result they are more likely to demand more Coffee than people in the countryside.
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