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03-International Business
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03-International Business

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03-International Business

03-International Business

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  • 1.  
  • 2. International business
    • International Business
    •   The exchange of products and services among countries
    • Transaction that are carried out across national borders to satisfy the objectives of individuals and organization
  • 3. Motivation to do international Business
  • 4. Motivation to do international Business
    • Proactive:
      • to increase profit
      • to take advantage of product life cycle
      • to achieve Economies of scale
    • Reactive:
      • Competitive pressures
      • Overproduction and excess capacity
      • Declining domestic sales
      • saturated domestic markets
  • 5. Considering International Expansion
    • Gauging international demand
      • Is there any demand for the company’s products abroad?
    • Adapting to customer needs
      • If so, must those products be adapted for international consumptions?
    • Entry strategies
      • How to entry into foreign markets?
  • 6. Going international
  • 7. Gauging international demand
    • Preliminary screening for attractive country markets
    • Assessment of industry market potential
    • Identify the potential demand for the company products and services
    • Forecasting the company selling
    • Assessment of the company market share
  • 8. Adapting to customer needs
    • Products and Services should meet to foreign market
    • Price adjustments by considering the cost of foreign trade, such as transportation, taxes, exchange rate
    • Distribution system through existing transportation system, suppliers and stores
    • Promotion should be modified based on different languages, law, and culture from country to country
  • 9. Barriers to International Business
    • Cultural and social barriers
    • Legal and political barriers
    • Economic barriers:
      • Tariff and trade restrictions
      • Quotas and embargo
      • Exchange control
      • Subsidy
  • 10. Entry strategies
    • Exporting – firms that distributes and sells products to foreign countries
      • indirect - through an intermediary
      • direct - deal with foreign customer and firms
    • Licensing
      • an agreement in which a licensor gives to a licensee the right
      • in using the licensor’s patent, trademark, copy right, technology, production processes, and product
      • in return for licensee’s fee
  • 11. Entry strategies
    • 2. Franchising
      • the granting of the right by franchisers to franchisee
      • in prescribed manner; selling its products
      • using its name, production, brand, marketing approaches
    • 3. Foreign Assembly
      • a firm exports components parts to subsidiary
      • for local assembly into finished products
  • 12. Entry strategies
    • 4. Turnkey Operation
      • an arrangement in which a supplier designs, builds, and trains the staff of an operating facility
      • for foreign buyer
    • 5. Foreign production subsidiary
      • a subordinate company established in another country by parents company
      • for the purpose of production
  • 13. Entry strategies
    • 6. Foreign production subsidiary
      • a subordinate company established in another country by parents company
      • for the purpose of production
    • 7. International Firm
      • Conduct a significant portion of its business
      • In foreign countries
  • 14. Entry strategies
    • 8. Multinational Corporation
      • a firm that is based in one country (parent country)
      • has production and marketing activities spread in one or more foreign country (host country)
    • 9. Joint Venture
      • a partnership of two or more parties who share ownership and control
      • for the venture’s operations and property rights
  • 15. Entry strategies
    • 10. Foreign Direct Investment
      • Arrangement in which a firm buys or establishes tangible assets
      • In another country
      • Through direct investment
      • By buying a company stock in capital markets
  • 16. International Organization
    • General agreement on Tariff and trade (GATT) – an international organization formed to reduce or eliminate tariff and other barrier to international trade
    • International Monetary Fund (IMF) – an international financial organization that lend money to countries in conducting international trade
  • 17. International Organization
    • World Bank – an international financial organization that lend money to underdeveloped and developing countries for development
    • Economic Communities – the creation of common economic policies
      • World Trade Organization (WTO)
      • European Community (EC)
      • North American Free Trade Agreement (NAFTA)
      • Asian Free Trade Agreement (AFTA)