Logistics means transfer of value from the seller to the customer (FTAA, 2003). One of the key concerns for Venezuelan companies will be protecting their market position. Legal and intellectual property rights are an important part of this equation, but so is the ability to anticipate the reactions of customers to new competition (FTAA, 2003). MERCOSUR specifically addressed and took steps to protect software and innovative hardware advances in its language (FTAA, 2003). This alleviates many worries of this nature for all technologically-based companies, including Technodyne. Service marks and trade marks are also protected. Delivery of services will be the greatest challenge in the Venezuelan Value Chain. Traditionally, the most effective means to move goods in Venezuela was by air and by sea (FTAA, 2003). The expense of these modes of transportation may make them cumbersome due to their effects on the cost of goods sold and final selling price of the goods. Technodyne and other corporations may have to take an active role in the development of the infrastructure in order to alleviate these effects. This will have a significant and immediate effect on cash flow, but will pay off in the long-term in the way of lower transportation costs.

Transportation costs are affected by oil prices. Currently, Venezuelan oil is controlled by a monopoly, PDVSA. Currently, this monopoly is seeking market expansion by way of an agreement with China (Marquez, 2006). This agreement could have long-term effects on Technodyne and other Venezuelan companies as well. The effects on transportation costs and other operating costs cannot be yet determined, but some effect is inevitable. This agreement may also open the door for trade agreements involving...

Technodyne will stay informed of the situation and will constantly analyze the effects on its market position, as well as any new opportunities that may arise.
In conclusion, value chain integration places multinational companies on an equal level with other global competitors (Hosseini and Barnes, 2006). For large companies, such as Technodyne, MERCOSUR means expanded opportunities. MERCOSUR has forced the company and others like it to re-examine every part of their operation. It has forced many to become leaner in management techniques. MERCOSUR means many changes and necessitates constant monitoring and evaluation to make certain that we can remain competitive in the future. The topics addressed here only scratch the surface of the complex issues that will evolve as a result of MERCOSUR. Technodyne sees MERCOSUR as the doorway to expanded opportunities and access to a larger market. Technodyne welcomes the challenges as a means to improvement.

Works Cited

FTAA Consulting. (2003). Business Guide to Latin America: Challenges and trends for Multinationals and Business. Retrieved May 19, 2006 at http://www.ftaaconsulting.com/bus_guide.htm.

Hosseini, J. And Barnes, R. (2006). Value Chain Management in the Global Market: The Role of Information Technology and Postponement. Retrieved May 19, 2006 at http://64.233.161.104/search?q=cache:p5HCu3dvUNYJ:classwork.busadm.mu.edu/Hosseini/SCM-Postponement.doc+MERCOSUR+business+advantages+venezuela&hl=en&gl=us&ct=clnk&cd=66

Marquez, H. (2006). Oil: Venezuela Seeks to Diversify Markets. IPS News. February 16, 2006. Retrieved May 19, 2006 at http://www.ipsnews.net/africa/interna.asp?idnews=27479.