The American university of Kurdistan

INTERNATIONAL FINANCE COURSE

ACCT 435

Report about:
METHODS OF INTERNATIONAL BUSINESS

Instructor:
Dr. Uzair Bhatti

Prepared by:
Nadya Osman
Solin Younes
Sarhat Khamo
 Foreign direct investment (FDI)

An overseas financier, trade, or management acquires an interest in an unfamiliar enterprise or

project through foreign direct investment (FDI). Usually, the term refers to a trade resolution to
purchase a big stake in an overseas firm or to purchase it completely in order to longer movements
into a new advertise. The term is exceptionally used to concern a sole stock grant in an external
company. Overseas direct contribution (FDI) is a main component of worldwide business-related
unification because it expands strong and enduring financial ties.

Foreign direct investment travels to countries that have acquired a certain level of economic
maturity, allowing it to function once in the host country. Of course, this is not a prerequisite, as
FDI would be channeled toward improving the fundamental economy where it is needed. In the
case of the Kurdistan Area, around $15 billion was invested in the region. The oil and gas industry
received the majority of these investments. In addition to material and equipment, the oil and gas
sector requires considerable logistics support for resource mobility. As a result, the immediate
implications of such FDI must be thoroughly investigated. Prior to the influx of IDPs, refugees,
and economic migrants in 2014, for example, there were minimal cultural interactions in the
Kurdistan Region. BYJU (an Indian instruction technology business) got US$ 500 heap in a new
round of capital influenced by Silver Basin, a US-located private impartiality firm, in 2020,
inasmuch as Unacademic, an Edtech principle, raised US$ 150 heap from SoftBank Group (a
Pertaining to the orient conglomerate).

International trade

International trade is the purchasing and commerce of merchandise and duties middle from two
points enterprises from various nations. The all-encompassing marketplace buys and sells items
bought by consumers, natural resources, snack, and vehicle. International profession admits
nations to extend their markets and receive approach to parts and duties that might alternatively be
nonexistent in their home country. On account of international business, stock exchange has
enhanced more aggressive. As a result, purchasers will benefit from more vying valuing and a
lower-cost product.

A dump is a commodity convinced to the all-encompassing market, inasmuch as a significance is

a merchandise bought from the all-encompassing advertise. Imports and exports are clarified in
the arranged transactions with bank of a country's balance of payments. All-encompassing
profession admits wealthier nations to better appropriate their possessions, to a degree labor,
electronics, and money. Different nations have various assets and timber, in the way that land,
labor, services, and science. This allows sure nations to produce the alike item more capably, that
is to say, faster and at a lower cost. In an appropriate, they concede possibility be able to close it
at a secondary cost than different countries. If a country cannot favorably produce a part, it can get
it through trade with another country that can. In worldwide work, this is popular as specialization.

Take, for instance, Ceramics and the United States of America. Dishes has a comparative benefit
over the US in the form of cheap labor that the US cannot counterpart. Employees in Porcelain
devise fundamental items bought by consumers at a lower opportunity cost than their matches in
the US. This is causing Porcelain has more unskilled labor than the United States of America.
Suitable way, utilizing these trained workers in the production of elementary customer parts does
not have a significant potential cost for Dishes. The United States of America, in another way, has
an approximate advantage in specific, well skillful workforce. American agents conceive refined
parts or investment prospects at lower freedom costs than their Pertaining to the orient matches.
Both the United States of America and Dishes gain from business and business in this class.

Franchising

Franchises offer several advantages, the most notable of which is that they shorten the path to the
client and save you time and effort in obtaining profits, and among the most important advantages
are:
• Trade support: Individual of the benefits of allow participation for franchisees is the
franchisor's business help. The franchisor concede possibility efficiently buy a jailer trade
operation contingent upon the agreements of the authority contract and misrepresentation
structure. They can be determined stigmatizing, supplies, provisions, and a displaying
strategy—basically, everything they demand to run the association. This news grant permission
be detracting to maintaining a profitable trade and form offset individual from scratch much
smooth.
• a famous brand: Bearing a client base vacant from the outset is individual of ultimate important
benefits that franchisees get when offset a franchise. If you authorize a trade from the very
beginning, you will should build your brand and client base from scratch, that concede
possibility take few opportunities.
• Franchises arise famous companies accompanying traditional client bases, so when you build
an authority at this moment premium brand, people will instinctively learn what your trade is,
what you present, and what they can expect. Franchises fail at a lower rate than free guests.
When a franchisor buys a right, he joins a powerful brand in addition to a network that offers
him aid and guidance, making disappointment less presumed.
• Salary: Franchisees frequently produce more earnings than alone constituted adventures. The
most of franchisees have famous brands that intrigue a large number of consumers. This
recognition results in raised return. Even franchises that demand a significant primary grant in
the form of authority payments have a helpful return on investment.
• Less risk: Offset a risk. This is valid either the administrator is launching a new firm or buys
a right. The risk is cut down when origin a right. Individual of the reasons franchisors have
less risk than individual business landowner is the right network. The broad plurality of
franchisees is possessed by well-known firms that have reliable and confirmed the authority
trade model in a difference of fields.

Disadvantages include:

• Limited immunity: While permit permits the franchisor to run his own firm, he does not have
position of great advantage over it and cannot form conclusions outside contacting the
franchisor. Ultimate bothering limitation for most franchisees is that they must understand the
restrictions noticed in the right arrangement. The franchisor has few controls over most of the
franchisee's movements and selections. These limits are fix to maintain harmony across
franchisees and the brand all at once, but they troubling and appear restricting to the franchisor.
• While the primary grant of right fees gives many benefits to the franchisee, it grants permission
more be valuable—particularly if you touch a well-known and very money-making firm. While
this usually leads to raised revenue, achieving that beginning capital disputing for any narrow
trade landowner. Even though you choose a cheap right, you will certainly suffer
supplementary payments of any thousand greenbacks. It is crucial to consider the potential
against the primary asset and achieve the right balance for your trade. Remind that skilled are
authority financing alternatives applicable to help you accomplish this first property.
• Apart from the initial loan essential to devise an authority, there are reappearing expenses that
are singular to franchises. Favorable circumstances costs of the franchise must be designated
in the right understanding. These costs involve royalties, displaying, and preparation costs.
Hold these repeating fees in mind while deciding either to start an authority.
• While the support network is individual of the benefits of having a right, skilled is too the risk
of difference. Any close occupied friendship, particularly individual accompanying an
imbalance of capacity, risks antipathy. While the right compromise describes two together the
franchisor and the franchisor's beliefs, the franchisor has the right to impose the right
agreement outside employing to priceless judicial proceeding. Although right determine
various space and rewards, I favor to start my own trade in the end. Right are like to raising
other person's offspring, and when he ends to take him apart you, he takes you with him. I am
not completely safeguarded and discontinued at any time.

Examples of Franchising in India:

• McDonald's and Domino's

• KFC
• Pizza Hut's
• Subway
• Donuts by Dunkin' Donuts
• Taco Bell's
 • Baskin-Robbins Inc.
• The Burger King

Licensing
A licensing understanding is a contract middle from two points two bodies (the licensor and the
licensee) that grants the licensee the right to use the licensor's brand name, logo, control science,
or skill to produce and close things. Namely, a licensing concurrence grants the licensee the right
to use the protected property created by original thought of the licensor. Licensing contracts are
usually used apiece licensor to create their protected property created by original thought. When
licensing occurs, it commonly results in a product that is to say brand-presented or co-tainted.
A license composition hopeful an example middle from two points Disney and Timex. Disney
leased allure name to Timex because they keep construct a watch pushing Mickey Mouse.
Licensing contracts concede possibility reside a expansive range of activities. A licensing
agreement, for instance, is a contract 'tween the proprietor of operating system and another guest
that authorizes the latest to use the calculating program in their common trade movements. A
licensing agreement in the joint subdivision hopeful when a McDonald's franchisee has a license
concurrence accompanying the McDonald's Corporation that permits ruling class to use the party's
tainting and shopping matters. Toy makers repeatedly engage in licensing understandings
accompanying feature studios, providing bureaucracy the civil liberties to produce operation
figures established standard movie type likenesses.

Joint venture (JV)

A joint venture (JV) is a trade institution at which point two or more parties consent to pool their
possessions to discharge the task. This task might be a new project or another form of trade project.
Profits, deficits, and expenses are split evenly with JV members. The venture, nevertheless, is
various from the things' pre-existing trade interests. Even though a JV is usually refer to as a
partnership, it maybe made utilizing some legal building, containing partnerships, participations,
restricted liability guests, and added monetary arrangements. Despite joint ventures being
commonly organized for production or research, they can more be made for continuing purposes.
Team below level of varsity can produce abundant and narrow firms together to cooperate on
individual or more projects or arrangements. Attending are the four fundamental reasons why
partnerships design Group of substitute players.
1. Leverage Resources
To Cut Costs
 2. Combining Expertise
3. Entering Foreign Markets
Already the JV has attained allure aims, it, like any different guest, maybe liquidated or convinced.
E.g., Microsoft Business sold allure 50% stake in Aradigm, a joint venture organized in 2011
accompanying Common Government-run public service. The joint venture was organized to
merge Microsoft's Amalga enterprise healthcare dossier and data structure accompanying sure GE
Healthcare electronics. Microsoft has immediately sold allure stake to GE, with conclusion the
joint venture. GE has consumed as the singular proprietor of the company and is free to run it as it
sees appropriate.

Acquisitions of existing operations

An acquisition takes place when one trade purchases the most or all the shares of another guest to
gain control of that party. Buying in addition 50% of a target party's shares and added property
provides the one who discovers a thing the right to create conclusions about the newly captured
property outside consulting the association's additional shareholders. Procurements, which are
coarse in trade, can occur with something or without the authorization of the mark firm. Skilled is
typically a no-shop supplying during the whole of the authorization procedure. Associations
commonly achieve other parties in external nations to access alien markets.
American Express, for instance, currently acquired a London nerve center, while Procter &
Gamble obtained a Panamanian whiten association. An acquisition happens when individual firm
purchase another. Additions allow firms to take total control of their worldwide movements and
fast capture a significant constituent the different display. An acquisition of an settled trade, in
another way, is subject to the risk of large deficits on account of the substantial financing. In
addition, if the external operation does not manage well, possibly troublesome to sell at a fair price.
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