Quality is the antidote to high exchange rates

Oh my, the Euro is rising... fast! Bad news for Eurozone companies... or is it really?

Well, it depends.
Back in the days, the German Mark was strong. Very strong. Was that a problem for Germans? Nope. Why? Because they produced with *quality*, making sure that their products would have a stable (or rising) demand, no matter the price.

As for countries with labour-intensive industries, like Portugal, "breaking" (devaluating) their currency would be the only way to maintain the competitiveness of their products. Yes, a very fragile competitiveness indeed.

The end result? German got richer and richer, and Portugal got poorer and poorer.

Lessons learned, marketing-mix designers? Go for quality, very good!
In a cutthroat economy, the only *real* competitiveness in the long run lies on producing high-quality products. Low quality bulk products will always tend to move where the costs of factors are cheaper!

Note to all: "go for quality" does NOT mean "spending money in marketing promotions positioning your production up there while not investing in the physical product quality"!!!