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Importance of globalization to international business
Importance of globalization to international business
Importance of globalization to international business
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International Business & Economic overview at mid-year of 2014 Preface International business is the activity of business among countries that mostly seeks for exporting and importing goods or services and other cross-border transactions. International business in terms of interstate relationships, whether bilateral or multilateral have been conducted since the beginning of the growth of world businesses. The government by their privileges and authority managing the administration and state the rules & policy to conduct and control this International Business activities. At the present, the barriers among Enterprises for establishing the business and go overseas seem to be disappearing, since the figure of world demand keeps increasing. In this case, the activity of exporting and importing among countries certainly important in order to fulfil the demand of the public. The increasing number of the population that had doubled since 19th century leads to the increase of world demand gradually. Recently reported that the population of the world reaches 7.023 billion people. With such big figure, there would be problems of scarcity to face. In this big opportunity, a business should concern to innovate, expand the market and compete among other businesses. World Business in 2014 We are now approaching the half of this year. There are scores of surprising predictions from experts regarding this year’s economic and business condition. According to the economists, the world economy is predicted to be more thrive than last year, the economic condition of the U.S. was also estimated to increase 3% and significant increase in the trade sector. This prediction may bring benefits for developing countries like Indonesia in the trade sec... ... middle of paper ... ...ir intention to build the FDIs in Karawang, West Java. The company will support the construction with US$ 174 million. From the investment, PMID expects to increase the capacity to produce Marlboro for domestic market and international market. To facilitate their ambitions, PMID will invest US$ 96 million. In 2012, the number of export of the product and the Sampoerna tobacco Philip Morris reached U.S. $ 24 million. It is expected that exports will increase by at least doubled in 2013, since the improvement of the producing capacity to produce more product. In response to Philip Morris investment, Secretary of the National Economic Council (DEN) Aviliani appreciate every step of investors who see Indonesia has a good chance to conduct business. "Definitely Indonesia is a good chance there is no other alternatives Indonesian Market incredible," said Aviliani.
Business Analysis Introduction: - Barilla has encountered many areas of their manufacturing and distribution processes that, for many reasons, could be vastly improved. To try to improve these areas, top logistics management decided to try to implement a JITD (just in time distribution) system, similar to VMI (vendor managed inventory). The management felt that they could cut back on problems such as wild demand swings and stock outs by using this method. Their distributors also felt a great deal of pressure to increase their inventory to prevent these stock outs while also ADDING items that they did not already carry, which would lead to even more inventory. Many employees in the logistics department thought the distributors should carry more inventory to deal with the stock outs but other knew the current inventory was already too much.
Table 1 (see appendix) shows the 10 main principal imports and exports of Australia with Indonesia for the year 201...
When it comes to doing business internationally the decision making is more complex. There are many interactions between each country that need to be addressed. In order for a business to be successful in the international market they need to examine and analyze all the facets of their company. They need
Philip Morris International focuses on providing high-quality products. The firm is known for selling some of the best tobacco products in the world. PMI earned a score of -1 on the Product Quality factor. Having the highest revenue and profit of the top tier transnational firms (this excludes CNTC who sells nearly all of their products in China), a score of -1 is given to PMI on the Market Share factor. The Brand and Image factor is scored as -1 since the Marlboro brand is one of the most recognizable brands in the world and Philip Morris is the most recognizable company of "The Big Five". PMI also earned a -1 on the Customer Loyalty factor as customers are satisfied with the product quality, consistency, safety and, ultimately, are loyal to the PMI brand they smoke. The slowing of revenue growth and the age of the
Domestic Business: Is the one that acquires all of its resources and sells all of
Why would a company go international? There are many reasons why companies would go international, but generally a company goes international so they can seek opportunities in domestic markets, or they seek solutions to problems that cannot be solved through domestic operations. There are many profitable possibilities by going internationally and these include greater profit potential, offers new locations to sell products, it may provide better access to needed raw materials, it may access to financial resources from many nations, and lastly it may allow labour-intensive activities to locate in countries with lower labour costs. For a small business to become an international business they must use five guidelines the first is global sourcing, exporting and importing, licensing and franchising, joint ventures, and wholly owned subsidiaries. The first two are market entry strategies and the remaining are direct investment strategies.
Chennai has become an important destination for trade and tourism, in recent years. It has evoked as a city with tremendous potential for industrial growth because of its economic viability and available infrastructure. The State Government Departments are geared towards increasing trade and commerce links with other countries and also developing greater industrial growth. The entire boom in the trade and business of Chennai city accounts largely for its rapidly growing population. More businesses and job opportunities in the city lure people from in and around Chennai and settle in here. Major multinationals have already set up their branch offices in Chennai, leading to more people being hired by these companies. So, the population of Chennai has grown rapidly in the last 20 years, due to major industrialization and tremendous growth (Census of India, 2011).
Illustrating on a broad variety of this study, it researches about the developments in the world economy. With the elements to be mentioned, such strategies contribute to the adaptation of models from the rich countries to the developing countries. That is for the purpose of developing the most efficient in a global market-oriented economy. In the political and economic aspects of Indonesia, as how it can maximize its chances for success, and what exactly is the role of international financial and trade institutions in its development.
Expansion across seas can be very advantageous and lucrative for many companies; however, there are many risks associated with doing business overseas, and companies that intend to expand internationally should be careful and strategic when doing so. Not only do companies run the risk of experiencing a product fail due to differences in cultures, they also face severe political and economic risks as well.
THE POLITICAL ENVIRONMENT: The critical concern Political environment has a very important impact on every business operation no matter what its size, its area of operation. Whether the company is domestic, national, international, large or small political factors of the country it is located in will have an impact on it. And the most crucial & unavoidable realities of international business are that both host and home governments are integral partners. Reflected in its policies and attitudes toward business are a governments idea of how best to promote the national interest, considering its own resources and political philosophy. A government control's and restricts a company's activities by encouraging and offering support or by discouraging and banning or restricting its activities depending on the government. Here steps in international law. International law recognizes the right of nations to grant or withhold permission to do business within its political boundaries and control its citizens when it comes to conducting business. Thus, political environment of countries is a critical concern for the international marketer and he should examine the salient features of political features of global markets they plan to enter. THE SOVEREIGNITY OF NATIONS From the international laws point of view a sovereign state is independent and free from external control; enjoys full legal equality; governs its own territory; selects its own political, social, economic systems; and has the power to enter into agreements with other nations. It is extension of national laws beyond a country's borders that much of the conflict in international business arises. Nations can and do abridge s...
In order to satisfy this market needs, a well-rounded plan is needed to distribute the product. It is a perception that has to change internationally and the most appropriate way to approach this issue is indirectly. Through indirect exporting, the other intermediary companies can provide a range of services to include logistics and marketing tailored for that target market, likely making the product familiar, or
The plus points of having your business involved in the international level business are not just limited to an increased exposure leading to tremendous traffic flow and continuous sources of money for filling up your pockets. In fact, letting your business grow in a bigger market houses a wide range of benefits that you might be unaware of. That’s why we have compiled this article to help you in getting an idea of importance of international business.
15. Hill, Charles W.L. International Business: Competing in the Global Marketplace. New York : McGraw-Hill, 2007.
I found this topic so interesting and motivating and I believe that I got some new knowledge and skills after attended this assignment topic. My experience has been successfully expanded as a result of attending classes, to include global approach to the international business. I found out that practice for international business has become little bit complicated due to influence of globalization.
Besides that, also important to consider there is the difference in shipping costs from different ports, as it will change the “landed cost” of the item, and the retail price and profit margin. Then, Problems encountered in international business larger and more complex than the problems faced in the domestic business. In example, the manager of an international organization decides to reduce costs and maximize the value-added. They must decide whether it is ethical to comply with all labor and environmental standards are found to be lower in less developed countries. In addition, they must decide which one foreign market to enter and should be avoided. The domestic business manager was not affected by this factor directly, but they will be affected by the economic downturn of international trade.