If in case you plan to start your own manufacturing, trading, etc comprising Domestic and International Business, how would you begin. Explain the process/ steps? Ans . Business: is an activity of Exchange wherein a desired product or service or ideas/concept is obtained by one party by offering something in return. For exchange potential to exist, five conditions must be satisfied: 1. There must be atleast two parties 2. Each party has something that might be of value to the other party. 3. Each party is capable of communicating and delivery. 4. Each party is free to accept or reject the offer. 5. Each party believes it is appropriate or desirable to deal with the other party. Business transactions crossing national borders at any stage of the transaction is known as International Business. Whereas business transactions within the nations boundary is known as domestic business FDI Foreign Direct Investment occurs when a firm invests directly in production or other facilities in a foreign country over which it has effective control. Companies can enter a foreign market either through exporting or FDI. Manufacturing FDI requires an establishment of production facilities abroad eg- Coco Cola had built bottling facilities in about 200 countries in 2001, whereas service FDI requires either building service facilities or establishing an investment foothold via capital contribution and building office facilities.. One needs to distinguish between the flow of FDI and the stock of FDI. The flow of FDI refers to the amount of FDI undertaken over a given period of time. The stock of FDI refers to the total accumulated value of foreign- owned assets at a given time. Outflows of FDI mean the flow of FDI out of a country that is, firms undertaking direct investment in foreign countries. Inflows of FDI mean the flow of FDI into a country that is, foreign firms undertaking direct investment in the local countries. FDI in India

Foreign direct investment (FDI) in India has played an important role in the development of the Indian economy. FDI in India has - in a lot of ways - enabled India to achieve a certain degree of financial stability, growth and development. This money has allowed India to focus on the areas that may have needed economic attention, and address the various problems that continue to challenge the country.

Following are the 10 steps required to start a business 1. · Research Become knowledgeable about your industry, competition, and target market.

There are several ways to gain information regarding your industry, target market, and competition. A great place to start is: Try a search under “business” or “agencies”. Most states have agencies/departments designed to provide business owners information on your state, its economy, and data specific to regions/communities. Find out as much as you can about your competitors, too. In addition to your own research, you may consider hiring outside research firms or consultants if your budget allows. 2. · Business Plan Like a road map, your written plan should guide you toward success. Be sure to Our Business Plan

include financial statements, as lenders will ask to see this plan. Drafting a business plan is crucial to your business’s success. Template will enable you to consider ALL aspects of your business-some you may not have even pondered, yet! It is also necessary to have a business plan if you are seeking financial assistance from an outside source. The plan should be clear, concise, honest, complete, and grammatically correct. 3. Business Structure & Registration


Choose a structure (Corporation, Sole-Proprietor, etc.) that suits your business

needs and offers the best tax benefit. After the structure has been determined, file official paperwork to register your business with the appropriate agency. Choosing a business structure and the registration process is relatively simple. However, the legal and tax-related issues associated with your business’s structure should be researched thoroughly. You may want to enlist the help of an attorney &/or an accountant during this process. Your options include: SOLE PROPRIETORSHIP, GENERAL PARTNERSHIP, LIMITED PARTNERSHIP, LIMITED LIABILITY PARTNERSHIP, “C” OR “S” CORPORATION, FOREIGN CORPORATION, LIMITED LIABILITY COMPANY, & TAX-EXEMPT ORGANIZATIONS. Next, you will probably need to register your business with the state or county. Registration requirements will vary. 4. · Financing Determine how your business will be financed.

Every business owner MUST consider how his or her business will be financed. Some common sources of funding include: personal savings, home equity loans, credit cards, friends/family, banks & credit unions, and venture capital companies. If personally financing, fund your business in different phases so that smaller amounts of money can be distributed over time. Hopefully, but not always realistic, your business will quickly begin making money that can be reinvested rather than using more personal funds or getting additional loans, etc. 5. · Zoning & Licensing You may need to acquire special licenses or permits for your business. This will

depend on the type of business you are running and/or its location. Requirements vary according to state, city, or county guidelines. 6. · Location Choose a suitable location for your business and client needs.

Choosing a good location can have a direct impact on the success of your business.

The first question to ask yourself is…Can my business be run from home or do I want/need an outside office location? If you chose an outside location you must continue and ask… -Should I buy or lease the property? -Is this location easily accessible and/or near my target client base? -Does this site have a lot of traffic passing by? -Which side of the street will bring more customers? -What are the demographics of the area surrounding my office? -Should I choose a stand-alone building, a strip mall, power center, or regional mall? -Will nearby stores help attract business to my establishment? -Is parking adequate, easy to enter/exit, well lit, etc.? -How is the condition of the building? Does it meet zoning and other local requirements? What are other tenants opinion of the management? -What is the total cost of the lease including maintenance, modifications, common-area expenses, insurance, utilities, Security/alarm services, taxes, flat lease vs. percentage of Business revenue, how/when will rent increases be determined? -What are the terms of the lease to include: dispute resolution, required hours of operation, possibilities for expansion? -What is the history of the site to include: why it’s vacant, vacancy length, reason(s) for previous tenants move, fail/success rate of previous businesses at this site? 7. · Business Name and Registration Decide on a name for your business. Then, make sure it is available and register it

with the appropriate agency.

Registration of your business name and/or trademark can take place at the state, federal, and international level. As a business owner you will want to choose and register a name &/or logo appropriate to your business that does not infringe on copyright, trademark, or patent laws. Without proper research, all or partial rights to your trade name/trademark could be revoked. This can save A LOT of time and decrease the likelihood of your application being rejected! Registration can take place at the state, federal, and international level. Most states have a searchable database to help determine name/trademark availability. 8. · Professional Guidance Professional guidance is often necessary when starting a business. Attorneys,

insurance agents, accountants, and bondsman can be helpful depending on your business needs. 9. · 10. · Federal EIN Apply for a Federal Employer Identification Number if needed. Employees Research labor regulations if you plan to hire employees.

Q6. Explain STP in International Business and how it helps Marketing Ans6. Segmentation is the process of grouping people or organizations within a market according to similar needs, characteristics, or behaviors
Targeting is the actual selection of the segment you want to serve The target market is the group of people or organizations whose needs a product is specifically designed to satisfy Positioning is the use of marketing to enable people to form a mental image of your product in their minds (relative to other products)

International Business and International Marketing Companies that serve global markets, divide them into several clusters on the basis of similarities. And each such cluster is known as a segment. Segmentation helps marketers to serve the markets in a better way. Markets can be segmented in nine ways, but the most popular form is on the basis of individual characteristics, which include the demographic, psychographic and behavioral segmentations. Demographic segmentation is done on the basis of factors like age, gender, income, culture, and education. Psychographic segmentation is done on the basis of attitudes, beliefs, values, lifestyles, opinions, personalities etc. The general behavioral aspects of the customers become the bases in behavioral segmentation. After segmenting the markets, one or more segments are chosen for trade to be carried out. The process of choosing the most potential market segments is known as targeting. The current size and growth rate of the market, potential competition, and compatibility and feasibility are the three basic criteria for targeting the markets. After targeting the market, companies should select a global market strategy. There are three types of global market strategies available for firms. They are: undifferentiated global market strategy, concentrated global market strategy and differentiated global market strategy. As the next step, firms should position their product in the global market. Product positioning is nothing but creating a favorable impression of the product against the competitor's products in the minds of customers. Product categories usually opt either for high-tech or high–touch positioning in global

markets. High-tech products may be further divided into three categories such as technical products, special interest products, and demonstration products. High-touch products are also divided into three categories -- products that solve common problem, global village products, and products that use a universal theme.

Marketing in less developed countries offers several advantages to organizations. They can exploit the huge untapped markets and avail of tax benefits. By targeting the less developed countries, firms can expand their market share and become market leaders. Less developed countries provide certain special benefits for new firms to establish their operations in their countries. Thus, marketing in less developed countries proves to be very advantageous for firms operating at the global level. Q5. Ans. 1) Liberalization (or liberalisation) refers to a relaxation of previous government restrictions, usually in areas of social or economic policy. 2) Privatization is the incidence or process of transferring ownership of a business, enterprise, agency or public service from the public sector (government) to the private sector (business). 3) Globalization (or globalisation) describes an ongoing process by which regional economies, societies and cultures have become integrated through globe-spanning networks of exchange. The term is sometimes used to refer specifically to economic globalization: the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, and the spread of technology. Description The three dominant forces shaping societies and economies around the world are globalization, privatization, and liberalization. Because these processes are interrelated, they must be addressed collectively. The contributors to the volume show that globalization, privatization, and liberalization are multidimensional phenomena that impact not only the economic considerations of governments, but also sociocultural and environmental aspects of societies. The three phenomena also affect these units of

analysis— which Rao and his colleagues identify as regional, country, industrial, and organizational. The result is a cogent discussion of these powerful global forces, for the academic community, professionals in economic development, banking, finance, international investment, and global commerce.

After treating the conceptual issues of meaning, definition, and differing interpretations and perspectives, the volume examines the historical experience with regional economic integration. The flow of foreign direct investment—a major consquence of globalization, privatization, and liberalization of economies is considered next. This leads to a study of the challenges created for management at the microlevel in organizations, such as the intensification of competitiveness, and the increased importance of technology and technology management. In their examination of country-specific issues, the contributors show how widely experiences vary with regard to the way in which the three major processes are implemented and how the policies behind them are adopted. Finally, in their discussion of sectoral and industry-specific issues, the contributors note that great variations on how different industrial sectors and industries will approach and recreate themselves under the power of the three great processes.

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