Which component of CAGE analysis deals with geographical distance?

CAGE analysis is a framework used to evaluate differences between countries and their potential impact on international business. The components of CAGE stand for Culture, Administration, Geography, and Economics. Among these, the component that specifically addresses geographical distance is referred to as Geography.

Geographical distance plays a significant role in determining how companies engage with markets across borders. It encompasses physical distance, but also considers factors like logistics, transportation costs, and the time it takes to move goods or services between countries. Countries that are geographically closer often have better trade relationships due to reduced shipping costs and shorter delivery times, making it easier for businesses to operate effectively.

Understanding the geographical aspects allows businesses to strategize their market entry and expansion plans more efficiently. It directly impacts decisions related to supply chains, distribution networks, and overall operational logistics, making it essential for companies navigating international markets.