mpany's financial performance.
Recent changes in the global economy have brought with them a new emphasis on the importance of having a clear understanding of the costs of operating on a worldwide level. The creation of the European Community, for example, greatly reduced trade barriers for companies who operate within member countries, but increased barriers for companies outside the EC. The North American Free Trade Agreement (NAFTA), which is the subject of much controversy within the United States, greatly changes the amount and type of information that companies operating in both the United States and Mexico (for example) will need to have available. Companies must now be concerned with the labor costs in member countries, transportation costs (including fees and tariffs), and inventory costs that vary with the currency fluctuations.
Traditionally, cost analysis rarely recognizes the hidden costs of international business. Hidden costs may include purchasing costs, scheduling, communications, poor quality, higher inventory and less fl
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