International entrepreneurship : International entrepreneurship
is defined as development of international new ventures or start
ups that from their inception engage in international business,
thus viewing their operation domain as international from the
initial stages of international operation.
Example of Global
Tech industry are strong example of
successful global entrepreneurship.
Companies such as Microsoft, Apple,
Google and yahoo all evolved from
small startups with limited funding
corporations. The reason for the
rapid growth of these companies is
that the demand for these
technology- operating systems,
search engines, office software and
Domestic Entrepreneurship : Domestic entrepreneur
are distinguished by their emphasis on a production
expansion strategy and customer specialization
strategy. The production specialization strategy
consists of focusing on limited geographical markets.
The customer specialization strategy incorporates the
production of a specialty product that is purchased
infrequently. Thus, for both of the domestic
strategies, a consistent “closeness” between the
producer and consumer is implied. This may be an
important basis underlining the new venture's decision
to compete in an exclusive domestic context.
DIFFERENCE BETWEEN INTERNATIONAL AND
• Economic system : when an entrepreneur is operating in
national level he is required to understand economic
conditions with in country, but at international level he
should be having information about economic system of
countries he running business which includes currency
rate, phase of business cycle etc.
sensitivity : entrepreneur operating at
national level should understand cultural issues
persisting in home country and at international level
he has to understand and manage cultural diversity
of customers as well as employees in company.
Technological environment : even though technology is
advanced at larger scale , still there are technological
variations persisting in various countries depending on time of
implementation, updation of technology etc. which has to be
analysed by entrepreneur and accordingly plan in business
• Government policy : entrepreneur going in for
internationalization of business have to study
domestic as well as international policy, as restriction
laid in home country for export of goods affect trade
of entrepreneur and restriction in host country on
entering of new entrepreneurs in their company.
Political and legal environment : politics and laws play
a critical role in international business as well as
domestic business. Entrepreneur should be aware
about political and legal environment in the domestic
as well as international market.
International entrepreneurship is a
process of conducting business
activities across national boundaries.
It includes exporting, licensing, or
opening a sales office in another
Main purpose is to satisfy the needs
and wants of target consumers.
IMPORTANCE OF INTERNATIONAL
ENTREPRENEURSHIP TO FIRM
sales and profit : when the
entrepreneurs are not able to earn profit or demand
for their product in domestic market they can sell
their products in foreign market where life cycle of
product is in favourable condition. E.g. Apple
earned more profits from international business
than in local market US in the year 1994. ( $ 390
million foreign market / $ 310 in Indian market .
manufacturing cost : if manufacturing cost
of product increase in home country, then company
can opt host country for production process where
resources are cheaper.
E.g. Mc Donald's.
of cheap labour : quantity and
quality of labour is one of the major
challenge for every business, if the labour is
cheap in foreign countries then company
organization is into foreign operations. E.g.
increasing cost of labour in china has forced
companies to search for other options for
outsourcing company activity to other
countries where cost of labour is less.
of talent : when entrepreneur
are not able to get required talented work
force in country, then they can hire
employee from host country which has
Expansion of domestic market : international
business causes domestic market to expand
beyond national boundaries. When the
domestic market has been fully tapped then
company can go for expansion of business to
market their products in international market.
Globalization of customers : When customers
in country prefer purchasing foreign brand
products then domestic companies have to go
for internationalization of business to keep in
pace with competition to attract customers.
E.g. Tata Motors begin to operate in
international market after entry of foreign
competitors in Indian market like ford.
Globalization of competitors : international
business motivates companies to face
competition on global level which in turn leads to
growth of market, pursuing global scale
Expansion and diversification of business
: entrepreneurs whose core business strategy is
expansion and diversification of business,
international business is one of the primary
platform to achieve these objectives.
Attracts customers in domestic market :
international business improves image of the
company in domestic market and attracts more
customers in domestic market due to
internationalization of business. E.g. Ranbaxy