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International Business Is A Term Essay

These can create significant management problems due to the impact of different cultures, taxation and pricing, the complexity of choosing the optimal structure for international business, high political risks and many other issues. The specifics of financial planning is determined by the following problems, including volatility in exchange rates, particularly the national taxation, revaluation of currencies, possible difficulties with the export of funds from abroad, problems with in-house transfer pricing, and problems in terms of estimating performance of foreign subsidiaries. The best known areas of international business development are in wholly-owned subsidiaries, joint ventures, licensed concerns, franchise agreement opportunities, exports and imports and offshore production. In the competitive business market of today there is so much competition that most companies sell outside the country to increase the total sales volume (ibid 69-70).

The increasing internationalization of all types business is requiring that managers have a global business perspective and also an understanding of the many differences in the economic and environmental forces of the various markets in which they find themselves operating. Decision making in the international environment is much more complex. However, by having an intimate understanding of the many external environmental forces, this enables international managers to be alerted to many new opportunities (ibid).

Based on the above information, companies...

Companies should always take the effective steps in order to mitigate these various risks such as by using adequate diligence, proper communication and experience. Apart from the preceding factors, effective planning and the pursuit of business with the right partners can play a significant role in expanding a company's competitiveness and market share. Realistic decisions and expectations should be taken along with minute and current market analysis by using the news and media sources. However, when this is done correctly, the efforts are worthwhile and profitable, improving the company's competitiveness in the process.
Conclusion

To sum up, we have seen that international business is a term that is used to describe different issues that relate to a firm's operations with interests in many countries. Such firms are referred to as multinational corporations. The main important area of concern in the international business arena are cultural considerations. These include dissimilarity in living standards, law and legal systems, climate, language barriers and many others. However, unless a country invests and expands overseas, it will likely lag behind its competitors and lose market share to companies that are already there and prospering multinationally.

References

Czinkota, M.R., & Ronkainen, I.A. (2010). Global business: Positioning ventures ahead. London,

UK: Routledge.

Sources used in this document:
References

Czinkota, M.R., & Ronkainen, I.A. (2010). Global business: Positioning ventures ahead. London,

UK: Routledge.
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