INTERNATIONAL BUSINESS-MODULE 1

PRESENTED BY: MANJARI KUMARI ROLL NO.-10/MBA/07

INTRODUCTION:

International business is a term used to collectively describe all commercial transactions (private and governmental,sales,investments,logisti cs,and transportation) that take place between two or more regions, countriesand nations beyond their political boundary.

Studying international business is important because: Most companies are either international or compete with international companies. Modes of operation may differ from those used domestically. The best way of conducting business may differ bycountry. An understanding helps you make better career decisions. An understanding helps you decide what governmental policies to support.

The 6 Fundamental Concepts Behind Every Successful Business:

1. Supply and Demand. The fundamental idea behind business and a market economy. Want to determine where to sell or buy, or predict if prices will be going up or down? 2. Cause and Effect. Physics applied to the business environment. What you do will affect your competitor and the market and vice versa. 3. People like to feel important and special. Learn this and youve discovered one of the fundamental qualities of a great salesperson or marketer. 4. Simple clear communication, on-time. Dont make it technical, keep it easy to understand. Answer all questions when asked, and never forget to call back and follow-up. 5. Get the work done, on time, and with the highest degree of quality possible. 6. Ask lots of questions and get all the answers.

The Globalization of Markets:

A powerful force drives the world toward a converging commonality, and that force is technology. The result is a new commercial reality - the emergence of global markets for standardized consumer products on a previously unimagined scale of magnitude. Gone are accustomed differences in national or regional preference.

There has been growth in globalization in recent decades due to the following eight factors: Technology is expanding, especially in transportation and communications. Governments are removing international business restrictions. Institutions provide services to ease the conduct of international business. Consumers know about and want foreign goods and services. Competition has become more global. Political relationships have improved among some major economic powers. Countries cooperate more on transnational issues. Cross-national cooperation and agreements.

ORGANIZATIONAL PARTICIPANTS IN INTERNATIONAL BUSINESS:

There are three types of participants in international business: 1). Focal Firm: The initiator of an international business transaction, including MNEs and SMEs, that conceives, designs, and produces the offerings intended for consumption by customers worldwide. 2). Distribution channel Intermediaries: A specialist firm, that provides a variety of logistics and marketing services for focal firms as part of the international supply chain, both in the home country and abroad. 3). Facilitator: A firm or an individual with special expertise in legal advice, banking , customs clearance, or related support services, that assists focal firms in the performance of international business transactions.

INTERNATIONAL BUSINESS ENVIRONMENT:

ECONOMIC ENVIRONMENT POLITICAL AND LEGAL ENVIRONMENT SOCIO-CULTURAL DEMOGRAPHIC NATURAL PHYSICAL AND TECHNOLOGICAL

RISKS IN DOING BUSINESS IN EMERGING MARKETS:

(1) Strategic Risk (2) Operational Risk (3) Political Risk (4) Country Risk (5) Technological Risk (6) Environmental Risk (7) Economic Risk (8) Financial Risk (9) Terrorism Risk