NAME: KHIZRA SALEEM

CMS#401475
ASSIGNMNET: INTERNATIONAL BUSINESS
MANAGEMENT
TOPIC: CASE STUDY (BLADES Inc.)
SUBMITTED TO: SIR AMJAD
 Question and answers
Question#1
What are the advantages Blades could gain from importing from and/or exporting to a
foreign country such as Thailand?
Answer:
The advantages that Blades could get from importing is the Thailand could be decrease
their cost of products and increase Blades net income. The rubber and plastic are cheaper
when it is import from any foreign country like Thailand. Due to its superior or excellent
production process Thailand firms could never duplicate their high quality production
process so starting the subsidiary in Thailand would preserve blades sales from their
competitors. Blades is looking for longer term plans in Thailand. Importing from and
exporting to Thailand help Blade with an opportunity to build relationships with some
Thailand local suppliers. The advantage which Blades, Inc. could gain from exporting is
they are the one of the first firms that sell roller blades in Thailand. Blades is planning to
shift its sales to Thailand and this could be a major competitive advantage.

Question#2
What are some of the disadvantages Blades could face as a result of foreign trade in the
short run? In the long run?
Answer:
There are several disadvantages that Blades, Inc. could face. First of all, Blades would be
face the currency fluctuations and exchange rate risk in the Thailand. For example, the
cost of imported inputs in dollars may increase and become more expensive over the time
if Thailand suppliers do not adjust their prices. Blades, Inc. would also be suffering the
economic conditions in Thailand for example if there is a recession in Thailand Blades
would suffer from decreased sales to Thailand. In the long run Blades should be beware
from any regulatory limitations that Thailand government may be impose or force on
Blades Inc. The company should be careful about the political risk that involved in
operating the process in Thailand such as regulatory changes or tax increase may impact
on Blades subsidiary.

Question#3
Which theories of international business described in this chapter apply to Blades, Inc. in
the short run? In the long run?
Answer:
In this chapter there are three types of theories of international business the theory of
competitive advantage, the imperfect markets theory and the product cycle theory. In
short run Blades prefer to import from Thailand because raw material such as rubber and
plastic are cheaper in Thailand also it prefer to export to Thailand to take an advantage
of the fact that limited rollers blades are currently sold in Thailand both of these factor
suggest that imperfect market theory which is apply in short run. In long run the core
objective of Blades Inc. is to start a subsidiary in Thailand and it is the first roller blades
manufacture company in Thailand. The superiority and excellence of high quality
production process suggest the comparative advantage theory that is apply in Blades in
the long run.
Question#4
What long-range plans other than establishment of a subsidiary in Thailand are an option
for Blades and may be more suitable for the company?
Answer:
Hot ben is not familiar with international business and Blades has never goes outside the
united states the establishment of a subsidiary is not a good way for Blades Inc. to gain
position in Thailand in long run. Blades should consider a joint venture with Thailand firms
that making roller blades. The advantage would access to Thailand distribution channel
familiarity of Thailand firm with duties, custom, ethics and morals in Thailand. The Blades
production plan is unique and a joint venture would provide Thailand subsidiary with
knowledge of production purposes which it may duplicate after the joint venture
terminates or end.