This document discusses several factors that complicate financial management for multinational firms, including cultural differences between countries, varying corporate governance rules and regulations, foreign exchange risk from currency fluctuations, political risk from changes in foreign governments, needing to modify financial theories for different countries' standards, and adapting financial instruments to different international contexts. It provides examples for each complicating factor to illustrate challenges multinational firms face in their international financial management.
A multinational corporation (MNC) operates in more than one country. International marketing differs from domestic marketing in several key ways, including dealing with different political entities, legal systems, monetary systems, and trade restrictions between countries. Culture and society greatly influence business activities and decisions through changing consumer preferences, demographics, advertising techniques, and internal company policies. McDonald's primarily uses franchising as its entry model in foreign markets, which allows for rapid global expansion at relatively low cost and risk by transferring responsibilities to local franchisees. Market segmentation divides markets into distinct subsets to better target customer groups. The purpose of international market segmentation is to target segments across national borders in a standardized way to gain economies of scale while still adapting to local customer
The document discusses the international business environment. It begins by explaining that globalization has increased the importance of international management due to businesses now operating across borders. It then discusses different classifications of the business environment including the micro and macro environment, and domestic, foreign, and global environments. Finally, it outlines the key components of the international business environment, including the political, legal, economic, socio-cultural, technological, natural, and demographic environments.
A family member or acquaintance has asked you for advice on a potential business decision involving market analysis of physicians, solar panel installation, gas stations, or organic farming. You decide to research the supply and demand conditions in the relevant market, including price elasticities of supply and demand, production costs, and other factors. Based on your microeconomic analysis of the market using principles of costs, revenues and profits/losses, you will provide the individual with an informed recommendation about whether or not to pursue the business opportunity and advice on how to approach it.
International business strategy refers to plans that guide commercial transactions between entities in different countries. There are various methods companies use to do business internationally, such as global sourcing, exporting, importing, licensing and franchising, strategic alliances, and establishing foreign subsidiaries. While international business has occurred for over a century, new opportunities are growing for both large corporations and small businesses to expand their operations globally through approaches like strategic partnerships and online networking.
The document discusses international business and globalization. It defines international business as commercial transactions between parties in different countries, such as exporting, importing, foreign direct investment. Managing international business is more complex than domestic business due to differences in countries' regulations, cultures, and competitive environments. Globalization refers to the increasing interdependence between nations through processes like international trade and investment that extend relationships between countries.
MBA INTERNAL ASSIGNMENT JAIPUR NATIONAL UNIVERSITYANIL KUMAR
The document provides information about global business planning systems and the components of an international business plan. It discusses determining demand in foreign markets, organizational structure, marketing strategy, costs, investment needs, and legal requirements. The key aspects of an international business plan include research on target global markets, supply chain and distribution plans, startup and operational costs, expansion strategy, management structure, financial projections, and obtaining necessary licenses and permits. The business plan communicates the company's goals, risks, and timeline for reaching objectives in global operations.
The document discusses various aspects of globalization including:
1) Globalization refers to the increasing integration and interaction between countries through international trade, flow of capital and technology.
2) Key drivers of globalization include multinational corporations, the WTO, World Bank and IMF.
3) Firms operate globally to access new markets, raw materials, labor and gain economies of scale. However, globalization benefits are not evenly distributed.
Unit 1: Environmental Context of International Business, Framework for analyzing international
business environment – Domestic, foreign and global environments and their impact on
international business decisions.
Global Trading Environment: World trade in goods and services – Major trends and developments;
World trade and protectionism – Tariff and non-tariff barriers; Counter trade.
Unit 2: International Financial Environment: Foreign investments -Pattern, Structure and effects;
Movements in foreign exchange and interest rates and then impact on trade and investment flows.
Unit 3: International Economic Institutions and Agreements: WTO, IMF, World Bank UNCTAD,
Agreement on Textiles and Clothing (ATC), GSP, GSTP and other International agreements;
International commodity trading and agreements.
Unit 4: Multinational Corporations and their involvement in International Business: Issues in
foreign investments, technology transfer, pricing and regulations; International collaborative
arrangements and strategic alliances.
Unit 5: Regional Economic Groupings in Practice: Regionalism vs. multilaterallism, Structure and
functioning of EC and NAFTA; Regional economic cooperation. Emerging Developments and
Other Issues: Growing concern for ecology; Counter trade; IT and international business.
A multinational corporation (MNC) operates in more than one country. International marketing differs from domestic marketing in several key ways, including dealing with different political entities, legal systems, monetary systems, and trade restrictions between countries. Culture and society greatly influence business activities and decisions through changing consumer preferences, demographics, advertising techniques, and internal company policies. McDonald's primarily uses franchising as its entry model in foreign markets, which allows for rapid global expansion at relatively low cost and risk by transferring responsibilities to local franchisees. Market segmentation divides markets into distinct subsets to better target customer groups. The purpose of international market segmentation is to target segments across national borders in a standardized way to gain economies of scale while still adapting to local customer
The document discusses the international business environment. It begins by explaining that globalization has increased the importance of international management due to businesses now operating across borders. It then discusses different classifications of the business environment including the micro and macro environment, and domestic, foreign, and global environments. Finally, it outlines the key components of the international business environment, including the political, legal, economic, socio-cultural, technological, natural, and demographic environments.
A family member or acquaintance has asked you for advice on a potential business decision involving market analysis of physicians, solar panel installation, gas stations, or organic farming. You decide to research the supply and demand conditions in the relevant market, including price elasticities of supply and demand, production costs, and other factors. Based on your microeconomic analysis of the market using principles of costs, revenues and profits/losses, you will provide the individual with an informed recommendation about whether or not to pursue the business opportunity and advice on how to approach it.
International business strategy refers to plans that guide commercial transactions between entities in different countries. There are various methods companies use to do business internationally, such as global sourcing, exporting, importing, licensing and franchising, strategic alliances, and establishing foreign subsidiaries. While international business has occurred for over a century, new opportunities are growing for both large corporations and small businesses to expand their operations globally through approaches like strategic partnerships and online networking.
The document discusses international business and globalization. It defines international business as commercial transactions between parties in different countries, such as exporting, importing, foreign direct investment. Managing international business is more complex than domestic business due to differences in countries' regulations, cultures, and competitive environments. Globalization refers to the increasing interdependence between nations through processes like international trade and investment that extend relationships between countries.
MBA INTERNAL ASSIGNMENT JAIPUR NATIONAL UNIVERSITYANIL KUMAR
The document provides information about global business planning systems and the components of an international business plan. It discusses determining demand in foreign markets, organizational structure, marketing strategy, costs, investment needs, and legal requirements. The key aspects of an international business plan include research on target global markets, supply chain and distribution plans, startup and operational costs, expansion strategy, management structure, financial projections, and obtaining necessary licenses and permits. The business plan communicates the company's goals, risks, and timeline for reaching objectives in global operations.
The document discusses various aspects of globalization including:
1) Globalization refers to the increasing integration and interaction between countries through international trade, flow of capital and technology.
2) Key drivers of globalization include multinational corporations, the WTO, World Bank and IMF.
3) Firms operate globally to access new markets, raw materials, labor and gain economies of scale. However, globalization benefits are not evenly distributed.
Unit 1: Environmental Context of International Business, Framework for analyzing international
business environment – Domestic, foreign and global environments and their impact on
international business decisions.
Global Trading Environment: World trade in goods and services – Major trends and developments;
World trade and protectionism – Tariff and non-tariff barriers; Counter trade.
Unit 2: International Financial Environment: Foreign investments -Pattern, Structure and effects;
Movements in foreign exchange and interest rates and then impact on trade and investment flows.
Unit 3: International Economic Institutions and Agreements: WTO, IMF, World Bank UNCTAD,
Agreement on Textiles and Clothing (ATC), GSP, GSTP and other International agreements;
International commodity trading and agreements.
Unit 4: Multinational Corporations and their involvement in International Business: Issues in
foreign investments, technology transfer, pricing and regulations; International collaborative
arrangements and strategic alliances.
Unit 5: Regional Economic Groupings in Practice: Regionalism vs. multilaterallism, Structure and
functioning of EC and NAFTA; Regional economic cooperation. Emerging Developments and
Other Issues: Growing concern for ecology; Counter trade; IT and international business.
This document provides an overview of international business. It defines international business as any business activity that crosses national borders. The scope of international business is broad, as it involves operating in foreign environments with uncertain rules and ambiguous regulations. Conducting international business requires understanding factors unique to foreign markets. A firm's guiding principles should have a global perspective to help managers identify opportunities outside their domestic economy. The document outlines various strategic choices firms face when internationalizing, such as decisions around marketing, sourcing, management, and public affairs.
The term globalization derives from the word globalize, which refers to the emergence of an international network of economic systems. Globalisation refers to rapid increase in the share of economic activity taking place across national borders. It goes beyond the international trade includes goods and services, delivered &sold & movement of capital.
Globalization or globalisation is the trend of increasing interaction between people or companies on a worldwide scale due to advances in transportation and communication technology, normally beginning with the steamship and the telegraph in the early to mid-1800s. With increased interactions between nation-states and individuals came the growth of international trade, ideas, and culture. Globalization is primarily an economic process of integration that has social and cultural aspects, but conflicts and diplomacy are also large parts of the history of globalization.
The document summarizes the topics of an international business presentation, including:
1) The importance of international business and how it benefits materials sourcing, global opportunities, and political relations.
2) How culture influences global business through consumer behavior, communication styles, and business practices.
3) How governments can help or hinder international business through various policies and political risks.
Managing people in global market notes @ mba bec doms on hrBabasab Patil
This document provides an overview of managing people in global markets. It discusses:
- The evolution of thinking around human resource management, moving from universal best practices to contingency-based and contextual approaches.
- Key approaches to managing employees such as HRM, which integrates people management into business strategy, and various HRM models.
- Managing human resources globally, noting the need to accommodate both local context and the company's varied, complex environment across many countries.
- The influence of national culture and institutions on HRM policies and practices, and how these must be adapted for each local context while still serving company interests.
Bontimel, bernadette joy s. international marketing (1)Sari Arciga
The document provides information about international marketing. It defines international marketing as marketing carried out across national borders. It discusses reasons why companies engage in international markets, including growth, finding new employees and resources, diversification, and ideas. It also outlines different concepts companies use when marketing internationally, such as the domestic market extension concept, multi-domestic market concept, and global marketing concept. Finally, it discusses reasons governments provide for restricting trade, such as national security, protecting infant industries, and retaliation against other countries' trade restrictions.
This document discusses trends and opportunities in international business. It predicts that globalization and trade will continue, but negotiations will be difficult. Technology will democratize global business and small firms can now participate globally. Government policies will need to coordinate to understand trade issues better. Careers will require language skills and international experience through internships abroad or international business courses. Opportunities for women and careers with large firms, small firms, or as entrepreneurs are outlined. Environmental and social concerns will increasingly shape products and markets.
WHAT IS INTERNATIONAL BUSINESS?
Advantages of International Business:
Dis-Advantages of International Business:
5 kinds of International best Business:
Foreign direct investment (fdi).
FOREIGN DIRECT INVESTMENT EXPLAINED IN one MINUTE
Imports @ Exports
This document provides an introduction to international finance. It discusses how companies and individuals can now raise funds, invest money, produce goods and sell products globally. This increased internationalization brings both opportunities in larger markets but also additional risks that must be managed. It gives examples of how trade and consumption have become highly globalized with people routinely purchasing goods from all around the world. Production has also become global as companies source inputs and locate production wherever costs are lowest. Financial markets too have integrated as investors diversify portfolios across borders. The document outlines some of the key questions international finance practitioners must address such as how to analyze investments across countries while accounting for currency and political risks.
The document discusses various topics related to international business and globalization. It defines key terms like globalization, multinational corporations, and modes of entering international business such as exporting, licensing, franchising, mergers and acquisitions. It also covers the organization structure of multinational companies and debates the pros and cons of globalization.
International business involves focusing global resources and opportunities to produce, buy, sell, or exchange goods and services worldwide. There are five stages of internationalization for companies: domestic, international, multinational, global, and transnational. As companies progress through these stages, their approach shifts from ethnocentric to polycentric to geocentric. International business environments are complex with many political, economic, socio-cultural, technological, legal, and natural factors that companies must consider when operating globally. Globalization has increased integration between world economies through liberalized trade, investment, and technological changes.
This document outlines the syllabus for an International Business course. It includes 5 units that will be covered: International Business Environment, Foreign Trade, Foreign Exchange Market, International Financial Institutions, and India's Foreign Trade. It provides learning objectives and outcomes, lists recommended books and online resources, and provides an overview of the content that will be covered in each unit.
Oreo strategy South America, Brazil- Internationa MarketingUrooj Ansari
The document discusses various international market entry strategies such as joint ventures, licensing/franchising, planned domestication, political bargaining, and expanding investment bases. It also discusses key considerations for global businesses, including establishing local connections, cultural responsiveness, and collaborative relationships. The three types of markets within countries are traditional rural, modern urban, and transitional low-income urban sectors. Demand differs based on market type and level of development. India is provided as an example country with all three market types, and rickshaws are proposed as a product that could succeed across the different sectors.
International business involves economic transactions that cross national borders. It includes trade of goods and services between individuals, companies, and organizations located in different countries. The main types of international business are export/import trade and foreign direct investment through wholly owned subsidiaries and joint ventures. International business transactions aim to satisfy objectives of participating entities and involve exchange of goods, services, capital, technology and knowledge across borders. Conducting business internationally presents unique opportunities but also challenges due to differing political, economic, legal and cultural environments between countries.
This document provides information about international business and regulatory bodies. It defines international business and lists factors that affect it such as cultural differences, logistics, and different laws between countries. It then discusses the structure and functions of the World Trade Organization (WTO) and includes a diagram. Finally, it provides short summaries of several international regulatory bodies: the European Union, United Nations, Organization for Economic Cooperation and Development (OECD), and International Accounting Standards Committee (IASC).
This document provides an overview of the basics of international financial management. It discusses the nature and scope of IFM, comparing domestic financial management to international financial management. It also describes the key participants in international finance, focusing on multinational corporations. MNCs own and control production facilities across countries, and account for a large share of global sales, assets, and employment. The document outlines the objectives, modes, and influences of international business, as well as the essential qualifications for a firm to be considered a MNC.
Multinational Company Walmart
Walmart is a large multinational retail corporation that operates in over 25 countries. It has its headquarters in the United States but has production facilities and stores located in other countries. Walmart began as a domestic company in the United States but has expanded globally over the years through international acquisitions and opening stores in foreign markets. As a large multinational, Walmart engages in various risk management strategies like hedging foreign exchange risk and offshore borrowing to mitigate financial risks associated with operating internationally.
Unit 1: Environmental Context of International Business, Framework for analyzing international
business environment – Domestic, foreign and global environments and their impact on
international business decisions.
Global Trading Environment: World trade in goods and services – Major trends and developments;
World trade and protectionism – Tariff and non-tariff barriers; Counter trade.
Unit 2: International Financial Environment: Foreign investments -Pattern, Structure and effects;
Movements in foreign exchange and interest rates and then impact on trade and investment flows.
Unit 3: International Economic Institutions and Agreements: WTO, IMF, World Bank UNCTAD,
Agreement on Textiles and Clothing (ATC), GSP, GSTP and other International agreements;
International commodity trading and agreements.
Unit 4: Multinational Corporations and their involvement in International Business: Issues in
foreign investments, technology transfer, pricing and regulations; International collaborative
arrangements and strategic alliances.
Unit 5: Regional Economic Groupings in Practice: Regionalism vs. multilaterallism, Structure and
functioning of EC and NAFTA; Regional economic cooperation. Emerging Developments and
Other Issues: Growing concern for ecology; Counter trade; IT and international business.
International Business Shivaji University SyllabusIshwar Bulbule
1. The document discusses the concept of international business, which involves business transactions across national borders, ranging from small export/import firms to large multinational corporations.
2. It describes how international businesses have grown significantly with globalization and liberalization since the 1970s, dominating the global economy.
3. International businesses must balance global and local operations and considerations, such as complying with local laws while profiting in home countries. They must also manage employment responsibly across different cultures and regulations.
Globalization refers to the increasing integration and interaction of economies, markets, technologies and cultures around the world. There are several key aspects of globalization, including the integration of economies and financial markets, opportunities for businesses and labor to operate internationally, and the growth of multinational corporations. While globalization can generate economic opportunities, its benefits are often unevenly distributed and can increase inequality between rich and poor. Major players in globalization include multinational firms, organizations like the WTO that negotiate trade agreements, and the World Bank and IMF that provide loans to governments. For firms to operate globally, they must consider factors like market regulations, infrastructure, government support, resources and competitors in foreign markets when deciding how to enter new countries
The document defines research and different types of research. It discusses business research as seeking to predict and explain phenomena in the ever-changing business environment to improve business performance and lives. Applied research aims to solve practical problems, while basic research acquires knowledge. Pedantic, popularist, puerile and pragmatic science are discussed in terms of their rigor and relevance. Learning outcomes include identifying good research topics and generating ideas, expressing topics as questions and aims/objectives, and understanding the role of theory.
This document contains notes on business law concepts including contracts, offers, proposals, acceptance, discharge of contracts, remedies for breach of contract, bailment contracts, finder of lost goods, pledge or pawn contracts, indemnity contracts, guarantee contracts, and agency contracts. It defines a contract, outlines the essential elements of a valid contract, and describes different types of offers such as express offers, implied offers, specific offers, and general offers.
This document provides an overview of international business. It defines international business as any business activity that crosses national borders. The scope of international business is broad, as it involves operating in foreign environments with uncertain rules and ambiguous regulations. Conducting international business requires understanding factors unique to foreign markets. A firm's guiding principles should have a global perspective to help managers identify opportunities outside their domestic economy. The document outlines various strategic choices firms face when internationalizing, such as decisions around marketing, sourcing, management, and public affairs.
The term globalization derives from the word globalize, which refers to the emergence of an international network of economic systems. Globalisation refers to rapid increase in the share of economic activity taking place across national borders. It goes beyond the international trade includes goods and services, delivered &sold & movement of capital.
Globalization or globalisation is the trend of increasing interaction between people or companies on a worldwide scale due to advances in transportation and communication technology, normally beginning with the steamship and the telegraph in the early to mid-1800s. With increased interactions between nation-states and individuals came the growth of international trade, ideas, and culture. Globalization is primarily an economic process of integration that has social and cultural aspects, but conflicts and diplomacy are also large parts of the history of globalization.
The document summarizes the topics of an international business presentation, including:
1) The importance of international business and how it benefits materials sourcing, global opportunities, and political relations.
2) How culture influences global business through consumer behavior, communication styles, and business practices.
3) How governments can help or hinder international business through various policies and political risks.
Managing people in global market notes @ mba bec doms on hrBabasab Patil
This document provides an overview of managing people in global markets. It discusses:
- The evolution of thinking around human resource management, moving from universal best practices to contingency-based and contextual approaches.
- Key approaches to managing employees such as HRM, which integrates people management into business strategy, and various HRM models.
- Managing human resources globally, noting the need to accommodate both local context and the company's varied, complex environment across many countries.
- The influence of national culture and institutions on HRM policies and practices, and how these must be adapted for each local context while still serving company interests.
Bontimel, bernadette joy s. international marketing (1)Sari Arciga
The document provides information about international marketing. It defines international marketing as marketing carried out across national borders. It discusses reasons why companies engage in international markets, including growth, finding new employees and resources, diversification, and ideas. It also outlines different concepts companies use when marketing internationally, such as the domestic market extension concept, multi-domestic market concept, and global marketing concept. Finally, it discusses reasons governments provide for restricting trade, such as national security, protecting infant industries, and retaliation against other countries' trade restrictions.
This document discusses trends and opportunities in international business. It predicts that globalization and trade will continue, but negotiations will be difficult. Technology will democratize global business and small firms can now participate globally. Government policies will need to coordinate to understand trade issues better. Careers will require language skills and international experience through internships abroad or international business courses. Opportunities for women and careers with large firms, small firms, or as entrepreneurs are outlined. Environmental and social concerns will increasingly shape products and markets.
WHAT IS INTERNATIONAL BUSINESS?
Advantages of International Business:
Dis-Advantages of International Business:
5 kinds of International best Business:
Foreign direct investment (fdi).
FOREIGN DIRECT INVESTMENT EXPLAINED IN one MINUTE
Imports @ Exports
This document provides an introduction to international finance. It discusses how companies and individuals can now raise funds, invest money, produce goods and sell products globally. This increased internationalization brings both opportunities in larger markets but also additional risks that must be managed. It gives examples of how trade and consumption have become highly globalized with people routinely purchasing goods from all around the world. Production has also become global as companies source inputs and locate production wherever costs are lowest. Financial markets too have integrated as investors diversify portfolios across borders. The document outlines some of the key questions international finance practitioners must address such as how to analyze investments across countries while accounting for currency and political risks.
The document discusses various topics related to international business and globalization. It defines key terms like globalization, multinational corporations, and modes of entering international business such as exporting, licensing, franchising, mergers and acquisitions. It also covers the organization structure of multinational companies and debates the pros and cons of globalization.
International business involves focusing global resources and opportunities to produce, buy, sell, or exchange goods and services worldwide. There are five stages of internationalization for companies: domestic, international, multinational, global, and transnational. As companies progress through these stages, their approach shifts from ethnocentric to polycentric to geocentric. International business environments are complex with many political, economic, socio-cultural, technological, legal, and natural factors that companies must consider when operating globally. Globalization has increased integration between world economies through liberalized trade, investment, and technological changes.
This document outlines the syllabus for an International Business course. It includes 5 units that will be covered: International Business Environment, Foreign Trade, Foreign Exchange Market, International Financial Institutions, and India's Foreign Trade. It provides learning objectives and outcomes, lists recommended books and online resources, and provides an overview of the content that will be covered in each unit.
Oreo strategy South America, Brazil- Internationa MarketingUrooj Ansari
The document discusses various international market entry strategies such as joint ventures, licensing/franchising, planned domestication, political bargaining, and expanding investment bases. It also discusses key considerations for global businesses, including establishing local connections, cultural responsiveness, and collaborative relationships. The three types of markets within countries are traditional rural, modern urban, and transitional low-income urban sectors. Demand differs based on market type and level of development. India is provided as an example country with all three market types, and rickshaws are proposed as a product that could succeed across the different sectors.
International business involves economic transactions that cross national borders. It includes trade of goods and services between individuals, companies, and organizations located in different countries. The main types of international business are export/import trade and foreign direct investment through wholly owned subsidiaries and joint ventures. International business transactions aim to satisfy objectives of participating entities and involve exchange of goods, services, capital, technology and knowledge across borders. Conducting business internationally presents unique opportunities but also challenges due to differing political, economic, legal and cultural environments between countries.
This document provides information about international business and regulatory bodies. It defines international business and lists factors that affect it such as cultural differences, logistics, and different laws between countries. It then discusses the structure and functions of the World Trade Organization (WTO) and includes a diagram. Finally, it provides short summaries of several international regulatory bodies: the European Union, United Nations, Organization for Economic Cooperation and Development (OECD), and International Accounting Standards Committee (IASC).
This document provides an overview of the basics of international financial management. It discusses the nature and scope of IFM, comparing domestic financial management to international financial management. It also describes the key participants in international finance, focusing on multinational corporations. MNCs own and control production facilities across countries, and account for a large share of global sales, assets, and employment. The document outlines the objectives, modes, and influences of international business, as well as the essential qualifications for a firm to be considered a MNC.
Multinational Company Walmart
Walmart is a large multinational retail corporation that operates in over 25 countries. It has its headquarters in the United States but has production facilities and stores located in other countries. Walmart began as a domestic company in the United States but has expanded globally over the years through international acquisitions and opening stores in foreign markets. As a large multinational, Walmart engages in various risk management strategies like hedging foreign exchange risk and offshore borrowing to mitigate financial risks associated with operating internationally.
Unit 1: Environmental Context of International Business, Framework for analyzing international
business environment – Domestic, foreign and global environments and their impact on
international business decisions.
Global Trading Environment: World trade in goods and services – Major trends and developments;
World trade and protectionism – Tariff and non-tariff barriers; Counter trade.
Unit 2: International Financial Environment: Foreign investments -Pattern, Structure and effects;
Movements in foreign exchange and interest rates and then impact on trade and investment flows.
Unit 3: International Economic Institutions and Agreements: WTO, IMF, World Bank UNCTAD,
Agreement on Textiles and Clothing (ATC), GSP, GSTP and other International agreements;
International commodity trading and agreements.
Unit 4: Multinational Corporations and their involvement in International Business: Issues in
foreign investments, technology transfer, pricing and regulations; International collaborative
arrangements and strategic alliances.
Unit 5: Regional Economic Groupings in Practice: Regionalism vs. multilaterallism, Structure and
functioning of EC and NAFTA; Regional economic cooperation. Emerging Developments and
Other Issues: Growing concern for ecology; Counter trade; IT and international business.
International Business Shivaji University SyllabusIshwar Bulbule
1. The document discusses the concept of international business, which involves business transactions across national borders, ranging from small export/import firms to large multinational corporations.
2. It describes how international businesses have grown significantly with globalization and liberalization since the 1970s, dominating the global economy.
3. International businesses must balance global and local operations and considerations, such as complying with local laws while profiting in home countries. They must also manage employment responsibly across different cultures and regulations.
Globalization refers to the increasing integration and interaction of economies, markets, technologies and cultures around the world. There are several key aspects of globalization, including the integration of economies and financial markets, opportunities for businesses and labor to operate internationally, and the growth of multinational corporations. While globalization can generate economic opportunities, its benefits are often unevenly distributed and can increase inequality between rich and poor. Major players in globalization include multinational firms, organizations like the WTO that negotiate trade agreements, and the World Bank and IMF that provide loans to governments. For firms to operate globally, they must consider factors like market regulations, infrastructure, government support, resources and competitors in foreign markets when deciding how to enter new countries
The document defines research and different types of research. It discusses business research as seeking to predict and explain phenomena in the ever-changing business environment to improve business performance and lives. Applied research aims to solve practical problems, while basic research acquires knowledge. Pedantic, popularist, puerile and pragmatic science are discussed in terms of their rigor and relevance. Learning outcomes include identifying good research topics and generating ideas, expressing topics as questions and aims/objectives, and understanding the role of theory.
This document contains notes on business law concepts including contracts, offers, proposals, acceptance, discharge of contracts, remedies for breach of contract, bailment contracts, finder of lost goods, pledge or pawn contracts, indemnity contracts, guarantee contracts, and agency contracts. It defines a contract, outlines the essential elements of a valid contract, and describes different types of offers such as express offers, implied offers, specific offers, and general offers.
This document provides an overview of corporate laws and secretarial practices in Pakistan. It defines key terms like law, corporate law, and types of business organizations. It also summarizes the different types of companies including public limited companies, private limited companies, and single member companies. The document outlines the registration process for companies and discusses the incorporation and provisions related to company names. It also describes the memorandum of association, types of share and debenture capital, and the roles and responsibilities of company secretaries.
Internatonal Business Notes Updated.pdfBilalAhmed717
The document discusses different stages of international business and reasons why companies go international. It begins by defining international business as commercial transactions between two or more countries. It then outlines four stages of international involvement:
1) Domestic company - operates only within its home country
2) International company - exports goods/services but has no foreign investment
3) Multinational company - has branches in multiple countries
4) Global company - operates as a single entity worldwide without tailoring products to local markets.
Companies engage in international business to expand sales, acquire resources, diversify sales/supplies, and minimize competitive risk. The main modes of foreign market entry are exporting, licensing, franchising, foreign direct
This document provides an overview of macroeconomics and related concepts. It defines macroeconomics as the study of the structure and performance of national economies and the policies that governments use to affect economic performance. It discusses the origins and development of macroeconomics as a field of study in response to the Great Depression. Key concepts covered include aggregate demand, the circular flow of income, national income measures like GDP and GNP, demand-side policies like fiscal and monetary policy, and expansionary and contractionary policies.
This document discusses various leadership theories including trait, behavioral, contingency, and situational leadership theories. It defines leadership and differentiates between managers and leaders. Trait theories focus on identifying innate qualities of leaders. Behavioral theories examine specific leader behaviors. Contingency theories emphasize that a leader's effectiveness depends on how their style fits the context. Situational leadership theories propose that leaders should adapt their style to followers' readiness levels. The document also discusses the Ohio State leadership studies, Michigan studies, Fiedler's contingency model, Hersey and Blanchard's situational leadership model, and path-goal theory.
Organizational behavior is the study of how individuals and groups act within organizations and how their behaviors impact organizational effectiveness. Managers guide organizations by performing four key functions: planning, organizing, leading, and controlling. Interpersonal skills like communication, empathy and conflict resolution are important for managers. Effective managers fulfill interpersonal, informational, and decisional roles like being a leader, liaison, monitor, and resource allocator. Understanding organizational behavior helps improve management skills.
This document defines key tax-related terms and concepts. It discusses the differences between direct and indirect taxes, and explains normal, special, and transitional tax years. It also covers topics like types of income, computation of taxable income, total income, deductible allowances, and residential status for tax purposes. The document provides examples to illustrate tax calculations and determinations of tax year and residential status.
Management involves planning, organizing, leading, and controlling organizational resources to achieve goals efficiently and effectively. The four main functions of management are planning, organizing, leading, and controlling. Strategic management is the process of formulating strategy, implementing strategy, and evaluating strategy to help a company achieve competitive advantage. It involves understanding external opportunities and threats as well as internal strengths and weaknesses. The strategic management process has six steps: defining vision and mission, performing external and internal audits, formulating strategy, implementing strategy, and evaluating strategy.
This document provides an overview of social psychology. It discusses how social psychology studies how individual behaviors and thoughts are influenced by others. Key topics covered include cognitive processes, environmental variables, biological factors, and cultural values that shape social behaviors. Research methods in social psychology like observation, surveys, correlation analysis, and experiments are explained. The role of theory in social psychology and important ethical issues around deception and informed consent in research are also summarized.
HR search is critical to a company's success because it ensures the correct people are in place. HR search integrates workforce capabilities with company goals by painstakingly identifying, screening, and employing qualified candidates, supporting innovation, productivity, and growth. Efficient talent acquisition improves teamwork while encouraging collaboration. Also, it reduces turnover, saves money, and ensures consistency. Furthermore, HR search discovers and develops leadership potential, resulting in a strong pipeline of future leaders. Finally, this strategic approach to recruitment enables businesses to respond to market changes, beat competitors, and achieve long-term success.
IMPACT Silver is a pure silver zinc producer with over $260 million in revenue since 2008 and a large 100% owned 210km Mexico land package - 2024 catalysts includes new 14% grade zinc Plomosas mine and 20,000m of fully funded exploration drilling.
Garments ERP Software in Bangladesh _ Pridesys IT Ltd.pdfPridesys IT Ltd.
Pridesys Garments ERP is one of the leading ERP solution provider, especially for Garments industries which is integrated with
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2. International Finance
2 | P a g e
Table of Contents
What is International Financial Management ...............................................................................................3
What is Multinational Corporation ...............................................................................................................3
Difference between MNC and a domestic corporation.................................................................................3
Why do firms become Multinational? ..........................................................................................................5
Goal of the MNCs:........................................................................................................................................6
Agency Problem............................................................................................................................................7
Agency cost...................................................................................................................................................7
Reasons of MNC agency problem ................................................................................................................7
Conflict with the MNC goal..........................................................................................................................8
Terminating the Agency Problem.................................................................................................................8
Parent Control of Agency Problems .............................................................................................................8
Corporate Control of Agency Problems........................................................................................................8
Management Structure of an MNC...............................................................................................................9
Centralized Management system: .............................................................................................................9
Decentralized Management system: .......................................................................................................10
Constraints on MNCs goal..........................................................................................................................10
Theories of International Business..............................................................................................................11
1. Theory of Comparative Advantage:................................................................................................11
2. Imperfect Market Theory:...............................................................................................................11
3. Product Cycle Theory .....................................................................................................................12
Modes/Methods of International Business..................................................................................................12
International trade...................................................................................................................................12
Licensing.................................................................................................................................................12
Franchising..............................................................................................................................................13
Joint Ventures .........................................................................................................................................13
Acquisitions of Existing Operations:......................................................................................................14
Establishing New Foreign Subsidiaries: .................................................................................................14
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International financial management may be defined as management of financial operations of different
international activities of an organization.
OR
International financial management is the process of making financial decisions pertaining to the foreign
business in such a way as to maximize the value of the firm and its stock owners.
Multinational company is also referred as multi domestic company formulates different
strategies for different market, doing their business across the national boundaries,
The offices/branches/subsidiaries of a MNC work like a domestic company in each country
where they operate with distinct policies and strategies suitable to that country concerned.
OR
Multinational corporations (MNCs) are defined as firms that engage in some form of
international business. Initially, firms start to export products to a particular country or import
supplies from a foreign manufacturer. Over time, however, they realize foreign opportunities and
eventually establish subsidiaries/branches in foreign countries.
Explanation
Multinational corporations operate in different host countries around the world and, they have to
deal with a wide variety of political, economic, geographical, technological and marketing
situations. Moreover, each host country has its own society and culture which is different in
many important ways from almost every other society or culture, although there are some
commonalities. Though society and culture do not appear to be a part of marketing situations, yet
they are actually key elements in showing how marketing activities will be conducted, what
goods will be produced, and through what means they will be sold to establishing industrial and
management patterns and determining the success or failure of a local subsidiary or affiliate.
These factors are very complicated for financial management in internationally, and they
increase the risks for the multinational firms. However, for high returns and better diversification
international firms has to accept these risks and learn how to manage them.
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1. Culture, History and Background:
Cultural
Culture are the learned norms based on the values, attitudes, and beliefs of a group of
people.
Because people belong to different groups based on nationality, ethnicity, religion,
gender, work organization, profession, age, political party membership, and income level,
and each group comprises a culture.
For example, McDonald's will vary its menu to adapt to differences in the local palate: in
Italy McDonald's serves pasta and in Japan rice and beans.
International companies and individuals must evaluate their business and personal
practices to ensure that their behavior may fit with national norms.
Language
The ability to communicate is critical in all business transactions. U.S. citizens are often
at a disadvantage because they are generally fluent only in English, whereas European
and Japanese businesspeople are usually fluent in several languages, including English.
2. Corporate Governance: Corporate governance can be defined as the set of laws, rules,
and procedures that influence a company’s operations and the decisions its managers
make.
In a foreign country, companies need to understand their foreign countries rules and
regulations the terms under which companies compete, but there should be a direct
negotiation between host governments and multinational corporations.
3. Foreign exchange risk: foreign exchange risk means the possibility that unpredicted
changes in future exchange rates will have adverse consequences for the firm.
For example, a U.S. company that imports laptop computers from Japan knows that in 30
days it must pay yen to a Japanese supplier when a shipment arrives. The company will
pay the Japanese supplier ¥200,000 for each laptop computer, and the current dollar/yen
spot exchange rate is $1 = ¥120. After the few days the rate of dollar increased against
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5 | P a g e
yen currency from $1 = ¥130. Now US company need to pay the amount to their current
currency rate.
4. Political risk: A nation might place constraints on the transfer of corporate resources or
even expropriate assets within its boundaries. This is political risk, and it varies from
country to country. The government is the care taker of all of us. So it also takes care of
business too. Govt. policies changes as per its ideology.
Another aspect of political risk is terrorism against U.S. firms or executives. For
example, U.S. and Japanese executives are at risk of being kidnapped in Mexico and
several South American countries.
5. Modification of Financial theories: Different countries have different legal structures,
financial methods and customs, and a multinational corporation must learn how to adapt to
these differences. For instance, a company in the United States might use the Securities
Exchange Commission generally accepted accounting principles, GAAP, but may have to change
to the international financial reporting standards when it has subsidiaries in other countries.
6. Modification of financial instrument:
Q: Identify and briefly discuss six major factors that complicate financial management in
multinational firms.
1. Market seekers: Ordinarily, higher sales mean higher profits and that in itself is a
motive for companies to go international. By reaching international markets, companies
increase their sales faster than when they focus on a single market, that being the
domestic one.
Thus, such U.S. firms as Coca-Cola and McDonald’s are aggressively expanding into
overseas markets, and foreign firms such as Sony and Toshiba now dominate the U.S.
consumer electronics market.
2. Raw material seekers: Manufacturers and distributors seek out products, services, and
components produced in foreign countries. They also look for foreign capital,
technologies, and information they can use at home. Sometimes they do this to reduce
their costs. For example, Nike relies on cheap manufacturing operations in Southeast
Asian countries to make its products.
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Ex. Many U.S. oil companies, such as ExxonMobil, have major subsidiaries around the
world to ensure access to the basic resources needed to sustain the companies’ primary
business lines.
3. Production efficiency seekers: Companies in high-cost countries are shifting production
to low-cost regions. For example, GE has production and assembly plants in Mexico,
South Korea, and Singapore; Japanese manufacturers are shifting some of their
production to lower-cost countries in the Pacific Rim.
4. Knowledge seekers/Technology: No single nation holds a commanding advantage in all
technologies, so companies searching the globe for leading scientific and design ideas.
For example, Xerox has introduced more than 80 different office copiers in the United
States that were engineered and built by its Japanese joint venture, Fuji Xerox.
5. Political safety seekers: For example, when Germany’s BASF launched biotechnology
research at home, it confronted legal and political challenges from the environmentally
conscious Green movement. In response, BASF shifted its cancer and immune system
research to two laboratories in the Boston suburbs. This location is attractive not only
because of its large number of engineers and scientists but also because the Boston area
has resolved many controversies involving safety, animal rights, and the environment.
6. To diversify: Sales increase in one country that is expanding economically and decrease
in another country that is in recession. Consequently, companies may be able to avoid the
full impact of price fluctuations or shortages in any one country, by obtaining supplies of
the same product or component from different countries.
In general, geographic diversification helps because the economic ups and downs of
different countries are not perfectly correlated.
The goal or objective of MNC is to maximize shareholder wealth
Financial manager throughout the MNC have a single goal to maximize the value of the
entire MNC.
Managers are supposed to make the decisions that can maximize the stock price and
therefore serve the stockholders.
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Whenever MNC want to take decision they see two things:
1. Objective: What is MNC goal, and what they wanted to achieve
2. Information: For achievement of their objective, they gather information from their
managers but some time it leads to a wrong information that can cause the agency
problem.
The possibility of conflict of interest between the owners and management of a firm is called
agency problem.
“Conflict of goals between a firm’s managers and shareholders is often referred to as the agency
problem.”
When company’s shareholder and managers are different then a conflict can exist we called them
the Agency problem
For example: Suppose you hire someone to sell your car and you agree to pay her a flat fee when
she sells the car. The agent’s incentive in this case is to make the sale, not necessarily to get you
the best price.
A decision to establish a subsidiary in one location versus another may be based on the location’s
appeal to a particular manager rather than on its potential benefits to shareholders. A decision to
expand a subsidiary may be motivated by a manager’s desire to receive more compensation
rather than to enhance the value of the MNC.
To solve agency problem which include time resources energy.
All efforts and cost to make the management in favor of shareholder
The costs of ensuring that managers maximize shareholder wealth (referred to as agency costs)
1. Subsidiaries are scattered: MNCs with subsidiaries scattered around the world may
experience larger agency problems because monitoring managers of distant subsidiaries
in foreign countries is more difficult.
2. Cultural differences: foreign subsidiary managers raised in different cultures may not
follow uniform goals.
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8 | P a g e
3. Sheer size of MNC: The sheer size of the larger MNCs can also create large agency
problems because larger the management lesser the control.
4. Foreign management may downplay the objection: Some foreign managers tend to
downplay the short-term effects of decisions, which may result in decisions for foreign
subsidiaries of the foreign based MNCs that are inconsistent with maximizing
shareholder wealth.
Subsidiary manager may be tempted to make decisions that maximize the values of their
respective subsidiaries.
There can be two ways to eliminate the agency problem:
Parent Control of Agency Problems
Corporate Control of Agency Problems
The parent corporation/head office of an MNC may be able to prevent agency problems with
proper governance:
1. Clearly communicate the goal of MNC: It should clearly communicate the goals for
each subsidiary to ensure that all subsidiaries focus on maximizing the value of the MNC
rather than their respective subsidiary values.
2. Monitoring by parent: The parent can oversee the subsidiary decisions to check whether
the subsidiary managers are satisfying the MNC’s goals.
3. Implement Compensation plans: The parent can also implement compensation plans
that reward the subsidiary managers who achieve the MNC’s goals.
1. Hostile Take-Over: If the MNC’s managers make poor decisions that reduce its value,
another firm may be able to acquire it at a low price and will likely remove the weak
managers.
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2. Investor Monitoring: Institutional investors such as mutual funds or pension funds that
have large holdings of an MNC’s stock have some influence over management because
they can complain to the board of directors if managers are making poor decisions. They
may attempt to enact changes in a poorly performing MNC, such as the removal of high-
level managers or even board members.
3. Stock Option: A common incentive is to provide managers with the MNC’s stock (or
options to buy the stock at a fixed price) as part of their compensation, so that they
benefit directly from a higher stock price when they make decisions that enhance the
MNC’s value.
1. Centralized Management system
2. Decentralized Management system
Centralized Management system:
In centralized management system,
strategic planning, goal setting,
budgeting, and talent deployment are
typically conducted by a single senior
leader
1. Lesser Agency Costs: It can reduce
agency costs because it allows managers
of the parent to control foreign
subsidiaries and therefore reduces the
power of subsidiary managers.
2. Poor decision making: The parent’s
managers may make poor decisions for the subsidiary if they are not as informed as
subsidiary managers about financial characteristics of the subsidiary.
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Decentralized Management system:
In decentralized management system,
formal decision-making power is
distributed across multiple individuals.
1. Higher Agency cost: Because
subsidiary managers may make
decisions that do not focus on
maximizing the value of the entire
MNC.
2. Good decision making: this style
gives more control to those managers who are closer to the subsidiary’s operations and
environment. To the extent that subsidiary managers recognize the goal of maximizing
the value of the overall MNC and are compensated in accordance with that goal.
The objective of MNCs is to increase or maximize the profit. But there are some restrictions or
barriers for achieving this objective. These barriers increase the cost of MNCs production, in
result MNCs face lower profit.
1. Environmental Constraints: Environmental conditions are different in various
countries. Where the parent company is working the environment is different from where
the subsidiary is working.
Environmental laws in America are strict than the environmental laws of Pakistan.
To avoid environmental pollution and industrial waste, you have to install filtration
plants.
This would require cost and eventually it would reduce the MNC profit.
2. Regulatory Constraints: Rules and regulation are different in countries.
For example: Protection of labor union in country is a very hazardous for MNCs because
you will not suspend or kick out your labor. Otherwise labor will go on strike for their
rights
3. Ethical Constraint: Ethics are also different in different countries.
A norm is ethical in one country and unethical in another country.
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Why do domestic firm go internationally and why they are converting from domestic into MNC.
Following are the theories which answer the above questions.
1. Theory of Comparative Advantage
2. Imperfect Market Theory
3. Product life cycle theory
1. Theory of Comparative Advantage:
Comparative Advantage means when a country specializes in some products, it may not produce
other products, so trade between countries is essential.
For example: Some countries, such as Japan and the United States, have a technology advantage
while other countries such as Jamaica and Mexico are large producers of agricultural and
handmade goods.
Specialization by countries can increase production efficiency and production efficiency can be
achieved through cheap labor and technology.
Since these advantages cannot be easily transported, countries tend to move for using their
advantages to specialize in the production of goods that can be produced with relative efficiency.
, such as Japan and the United States, have a technology advantage, while other countries, such as
Jamaica, Mexico, and South Korea, have an advantage in the cost of basic labor
2. Imperfect Market Theory:
In perfect market, markets were perfect, so that the factors of production (land, labor, & capital)
were easily transferable from one place to another, then labor and other resources would flow
wherever they were in demand. The unrestricted movement of factors would create equality in
costs and returns and remove the comparative cost advantage.
Anyone can enter and exit in this market.
Imperfect market means where factors of production are somewhat immovable. There are costs
and often restrictions related to the transfer of labor and other resources used for production.
There may also be restrictions on transferring funds and other resources among countries.
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Imperfect markets provide an incentive for firms to go foreign and to seek out foreign
opportunities.
3. Product Cycle Theory
This theory suggests when a domestic firm matures in domestic market it may search of
additional opportunities outside its home country.
In other words, we may say that when domestic firm garb up or capture the whole domestic
market then the firm move international market for additional benefits.
After this you will establish a subsidiary in foreign market but you will not be alone in that
market. There would also be a domestic firm that you have to compete with them.
Now, there is two possibilities either these competitors will eliminate or kick out you from that
market or you have to differentiate your business. So that you may survive or capture that
foreign market.
How Firms Engage in International Business?
Firms use several methods to conduct international business. The most common methods are
these:
1. International trade
2. Licensing
3. Franchising
4. Joint ventures
5. Acquisitions of existing operations
6. Establishing new foreign subsidiaries
International trade
International trade is a one way that a firm can use to penetrate markets (by exporting) or to
obtain supplies at a low cost (by importing).
This approach entails minimal risk because if the firm experiences a decline in its exporting or
importing, it can normally reduce or discontinue this part of its business at a low cost.
Licensing
Licensing is another way to expand one ‘s operations internationally.
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In case of international licensing, there is an agreement whereby a firm, called licensor, grants a
foreign firm the right to use intangible (intellectual) property for a specific period of time,
usually in return for a royalty/fee.
licensing is a low-risk and relatively fast foreign market entry tactic.
Licensing allows firms to use their technology in foreign markets without a major investment in
foreign countries and without the transportation costs that result from exporting
a. Intellectual property
i. Patent right: It is a right which is given to another to produce product
ii. Trademark: Registered name with logo
iii. Copyright: Right given to person (writing, new music, books, software)
Franchising
Franchising is closely related to licensing and is a special form of it.
Franchising is an option in which a parent company grants another company/firm the right to do
business in a prescribed manner.
A franchisee is a holder of a franchise; a person who is granted a franchise.
And a franchiser is a person who grants franchises.
Franchising differs from licensing in the sense that it usually requires the franchisee to follow
much stricter guidelines in running the business than does licensing.
For example: McDonald’s, Pizza Hut, Subway Sandwiches, Blockbuster Video, and Dairy
Queen have franchises that are owned and managed by local residents in many foreign countries.
Joint Ventures
Joint Ventures is a form of partnership in which two companies agree to work together, creating
a third independently managed company.
E.g. Sony and Ericsson producing Mobile phone with the brand name Sony Ericsson.
Many firms penetrate foreign markets by engaging in a joint venture with firms that reside in
those markets.
Most joint ventures allow two firms to apply their respective comparative advantages in a given
project.
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For example, General Mills, Inc., joined in a venture with Nestlé SA, so that the cereals
produced by General Mills could be sold through the overseas sales distribution network
established by Nestlé.
Acquisitions of Existing Operations:
Firms frequently acquire other firms in foreign countries as a means of penetrating
foreign markets.
Acquisitions allow firms to have full control over their foreign businesses and to quickly
obtain a large portion of foreign market share.
For example: American Express recently acquired offices in London, while Procter &
Gamble purchased a bleach company in Panama.
Establishing New Foreign Subsidiaries:
Parent company create a wholly owned subsidiary/branch in different countries.
An acquisition of an existing corporation is subject to the risk of large losses because if the
foreign operations perform poorly, it may be difficult to sell the operations at a reasonable price.
Establishing new subsidiaries may be more preferable than foreign acquisitions because the
operations can be done exactly to the firm’s needs and resident’s needs.