This document provides an overview of international business. It defines international business as transactions that involve two or more countries, including international trade, foreign investment, and services that cross borders. The key dimensions of international business are the various parties that can be involved, such as governments, businesses, and consumers interacting on a global scale. The document also outlines some characteristics of international business, including operating in multiple markets and currencies, and factors that have driven its growth like increasing globalization and liberalization of trade policies. It discusses strategies for entering foreign markets and some challenges of doing international business compared to domestic markets.

1. International
Business
Sapna Thukral

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5. Introduction
• Any business with international sales, sourcing or
investment.
• It consist of transactions that are devised and
carried out across national borders to satisfy the
objectives of individuals, companies and
organisations.
• It includes international trade and foreign
manufacturing.
• It also includes a growing service industry in
areas such as :transportation , tourism,
advertising, retailing, wholesaling and mass
communication. 5

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• International business is all business transactions that involve two
or more countries
• It comprises a large and growing portion of world’s total business.
• It takes place between a diverse external enviornment

7. Dimensions
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• Many types of parties can enter into the international business
activities .
• govt of nations are the permanent institutions that can also get
involved in such activities, whereas business firms are already into
international business conventionally.
• G2B
• G2G
• B2B
• B2G
• B2C

8. Business opportunities are
like buses. There’s always
another one coming.
Richard Branson
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9. Characterstics of
International Business
Multiple countries
involved
Resulting from
economic
interdependenc
e among the
countries
Use of multiple
currencies
Based on free
market economy
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10. Characterstics of
International Business
Involved in
movement of
products across
borders
Based on free
flow of factors of
production
International
Restrictions
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11. Nature
Accurate Information
International Markets
have more potential
Timely Information Size of International
Business
Market Segmentation

12. Scope of
International
business
Export Business
International Firm
Multinational Firm
Global Firm
Transnational Firm

13. Trends in International
Business
World Trade
has been
growing
faster than
world output
International
Financial
markets
have
expanded
Tarff and
Non Tarriff
barriers are
being
gradually
Dismantled
Exchange
rates are
now being
determined
more by
market
forces
Global trade
and
investment
have been
tying
economies
together

14. Trends in International
Business
Production is
being Globalised
Global Capital
flows are shaping
international trade
and the world
economy
Role of WTO and
other international
bodies in
International
business has been
growing

15. Reasons of International
Business
• Saturation of Domestic Markets
• Opportunities in Foreign market
• Availibility of low cost labor
• Increased Demands
• Consumer pressure
• Growing Consumer Pressures

16. Disadvantages
• Dumping
• Essential raw materials may get depleted
• Economic crises affect another country
• Self reliance gets reduced.
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17. Advantages of
International Business
• Growth
• Product Mobility
• Reducing Production Cost
• Unite economies
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18. Challenges
• Different Curriences
• Varying Trade Policies
• Different Market Conditions
• Different Languages
• Long Distance
• Laws and Regulations
• Immobility of factors of Production
• Different in national Resources
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19. Opportunities For
International Business
Opportunities
• Capitalize on low-hanging fruit to identify a ballpark value
• Nations Particularly developing countries are offering incentives
• Income and demand in developing countries are rising
• competion
• Policies , laws and regulations of national govt are becoming
increasingly liberal to cross border transactions
Opportunities
• Home Markets are Limited
• Political Stability is Increasing
• Good quality raw materials are available
• Greater homogeneity in taste and preferences
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Basis Domestic Business International Business
Nationality of Buyers and Sellers
Both buyers and sellers belong to the same country. It makes it easier
for both parties to understand each other and enter into business
deals.
Both buyers and sellers belong to different countries, which makes
business dealings relatively difficult due to differences in their
languages, attitudes, customs, etc.
Nationality of other Stakeholders
Stakeholders(employees, suppliers, creditors, etc.,) are from one
nation.
Stakeholders(employees, suppliers, creditors, etc.,) are from different
nations.
Mobility of Factors of Production
Degree of mobility of factors of production(land, labour, etc.) is more
as compared to international business.
Degree of mobility of factors of production(land, labour, etc.) is less as
compared to domestic business.
Nature of Customers
Customers are homogeneous in their taste, preferences, consumption
patterns and buying behaviour.
Customers are not homogeneous due to different socio-cultural
backgrounds, tastes, fashions, languages, beliefs, customs, etc.
Business Systems and Practices Business systems and practices are homogeneous within a country.
Business systems and practices are less homogeneous as there is
difference in development level, infrastructure, market facilities, etc.
Political System and Risks
Domestic business firms are familiar with political system of their
country. As a result, they are in a better position to understand and
predict its impact on business.
International business faces difficulties in understanding and coping
with different political systems of every country.
Business Regulations and Policies
Rules, laws or taxation policies of a single country prevail in domestic
business.
Rules, laws or taxation policies of various countries prevail in the case
of international business.
Currency used Currency of domestic country is used. Currency of more than one country is used.
Risk It involves comparatively less degree of risk. It involves a high degree of risk.
Order processing time There is a less time gap in order and supply of goods. There is a wide time gap between order and supply of goods.
Effect on Foreign Reserve It has no effect on the foreign reserves of a country. It has a direct impact on the foreign reserves of a country.

21. Strategies For Entering
Licensing
Joint Venture and
Alliance
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Exporting
Franchising
Contract
Manufacturing
FDI