modes of international business

1. Entering Strategies for
International Business
Presented by Rahman shah

2. Introduction
• Domestic market: All the economic
activities(producing, selling and buying) within a
country.
• International market: All the economic activities
beyond the country boundary.

3. Benefits of international business
• Survival and Growth
• Sales and Profits
• Diversification
• Employment
• Standards of Living
• Understanding of Marketing Process

4. Entry Modes
• Firms can use different methods to enter
international market.
– Exporting
– Turnkey Projects
– Licensing
– Franchising
– Joint Ventures
– Merger and acquisition
– FDI(foreign direct investment)

5. Exporting
• Exporting is process where goods are produced in one
country and purchased by residents of another
country.
• When similarity in culture
• Afghanistan- Pakistan export
• Afghanistan india

6. Licensing
• Permitting another party in foreign country to
produced and sells goods under your
trademarks, patients and copyrights, in lieu of
some royalty fee to other party.
• Pepsi and coca cola

7. Franchising
• Franchising is similar to licensing but only
difference is franchising in provision of
servicing. Like restaurants
• McDonald
• KFC
• Telecommunication

8. Joint Ventures
• A joint venture is a business entity created by two or
more parties, generally characterized by shared
ownership, shared returns and risks, and shared
governance.
• Google and NASA developing Google Earth
• BMW and Toyota
• Sony and Ericson’s

9. Merger and Acquisition
• An acquisition is a transaction in which a firm gains
control of another firm by purchasing its stock,
exchanging the stock for its own, or, in the case of a
private firm, paying the owners a purchase price.
• Google and Android
• Merger A merger occurs when two firms continue to
carry out business operations as one single firm rather
two separate firms.
• Exxon and Mobile

10. Trunkey project
• The contractor agrees to handle every detail of
the project for a foreign client, including the
training of operating personnel.
• Special training
• petroleum-refining

11. (FDI) Foreign direct investment
• Foreign direct investment refers to the formal
establishment of business operations on
foreign soil.
• German and Japanese automakers, such as
BMW, Mercedes, Toyota, and Honda.