...7/20/2014 Advantages and Challenges of Exporting - submitted by Tekle S. - International Business and Trade, Education and Training, Business Development … Hom e About Se rvice s C lie nts Login R e giste r The Knowle dge Brok e rs C ontact Se arch [ STAR T ] Ex pe rtAle rts™ Pop Top Vide os Type s Ex pe rtise C ountrie s Article s FAQ Back to Articles Overview Advantages and Challenges of Exporting Recom m end 41 people recommend this. Contributed by: Tekle S. (ID 584) Any company, before committing its resources to venture in the export business, must carefully assess the advantages and disadvantages of exporting into a new market. Whether it is unintentional or a deliberate move companies need to evaluate and carefully assess the advantages and challenges of exporting before committing resources. Visit Tekle S.'s Expert Profile In C ategory: Trade C opyright © Tekle S. (ID 584) , a prequalified Trainer from Brentwood, United States Article Stats Added: 16/01/07 787 Words 14119 x Read Any company, before committing its resources to venture in the export business, must carefully assess the advantages and disadvantages of exporting into a new market. While some companies enter the export business unintentionally after receiving order to purchase from foreign buyer that found their product. Others make a deliberate move and conduct thorough research before entering new market. Whether it is unintentional or deliberate...
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...Fundamentals of Logistics Management International Business period 1 LAS: International Business period 1 overview 1 Fundamentals Schedule of Logistics Management Week Content number 1 World of International Business, International Business environment , theories on and types of international Trade, Project Traid and International business, cultural analyses Cultural analysis, Porter Porter, Risk analyses Risk analysis, CSA / FSA analysis CSA / FSA analysis Overflow 2 3 4 5 6 7 DO NOT FORGET Rugman H1, H2 H3, H5, H6 H5, H13, DO NOT FORGET LAS: International Business period 1 overview 2 THEORIES ON INTERNATIONAL TRADE • Absolute and competitive advantage • Heckscher and olin’s theorem • The leontief-paradox • The flying geese model LAS: International Business period 1 overview 3 THEORY OF ABSOLUTE ADVANTAGE (Adam Smith) Each nation should specialize in producing goods it has a natural or aquired advantage in and therefore can produce more efficiently LAS: International Business period 1 overview 4 THEORY OF COMPETITIVE ADVANTAGE (David Ricardo) It is advantageous for two countries to trade if the cost ratio between the two countries differ (If producing x, expressed in y, is cheaper in country 1 than in country 2, while producing y in country 2 is cheaper than in country 1 , country 1 exports x and country 2 exports y) LAS: International Business period 1 overview 5 HECKSCHER – OHLIN • Two production...
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...UNIT 2 INTERNATIONAL BUSINESS THEORIES International Business (Trade) Theories Objectives After reading this unit, you should be able to : • understand the analytical foundations of international business • be familiar with the international trade theories • explain the FDI approaches to international business. Structure 2.1 Foundations of International Business 2.2 International Trade Theories Theory of Mercantilism Theory of Absolute Cost Advantage Theory of Comparative Cost Advantage Heckscher-Ohlin Model Leonief Paradox 2.3 FDI Theories Market Imperfections Approach Product Life Cycle Approach Transaction Cost Approach The Eclectic Paradigm 2.4 Summary 2.5 Key Words 2.6 Self-assessment Questions 2.7 Further Readings 2.1 FOUNDATIONS OF INTERNATIONAL BUSINESS The analytical framework of international business is build around-the activities of MNEs enunciated by the process of internationalisation. The FDI on the part of an MNE attempts to overcome the obstructions to trade in foreign countries. The strategies relating to the functional areas, such as production, marketing, finance and price policies, are adopted by the MNEs in such a manner that an amicable relationship between home and host nations is created. Foreign direct investment can be distinguished from the other forms of international business, such as exporting, licencing, joint ventures and management contracts. Basically...
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...Discuss the antecedents of International Business Models. International business models can be classified into two main categories: country-based theories and firm-based theories. Country-based theories view business in a macro perspective from a point a view of a nation and focus on trading phenomenon particularly in exports and imports. While firm-based theories are modern theories that emerged after the Second World War as it views business in a micro perspective from the angle of a firm. Despite the different perspectives of firm-based theories and country-based theories, they are interlinked and complement each other. The firm-based theories were developed from classic country-based theories and supported with empirical research. Country-based theories are international business theories that argue on the evolvement of business since the 16th century. The theories are classical theories that derived from an economic perspective. There are 4 theories involved in country-based theories. They are Mercantilism Theory, Absolute Advantage Theory, Comparative Advantage Theory and Heckscher-Ohlin Theory. Firm-based theories attempt to explain business phenomena related to international trade. Mercantilism theory was the first theory of international business that emerged in England in the mid of 16th century. The principal affirmation of the theory was its gold and silver were the mainstays of national wealth and essential to dynamic business. It was a political economy...
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...Identify and critically evaluate four variables that account for the emergence of international business. International Business, which is the other way to seek an opportunity of brand new markets and a better driver of changing the recent environment (Ramirez-Aleson & Espitia-Escuer, 2001). It is thought as a business or industry that attracts and provides in international economic activities (Peng, 2011). From the views of domestic and international industries, the former competes and collaborates with the foreign entrants, the latter enters an aboard market to get the market share for growing itself up. Peng (2011) argues that International Business includes both international activities and domestic activities. The traditional boundaries of international and domestic business are deliberated blurring, because most of the previously national markets are globalized now. Mention to the current situation about International Business, it is essential to understand what and how International Business is emerged. The variables of why International Business happened have been defined by scholars, first of all, Dunning (2001) believes competitive advantages are quite important to help corporations extend their business. Second, Johnson & Tuner (2003) indicates five drivers of International Business, that are Economy, International governance and regulation, Finance and capital, Communication technology, Social and cultural convergence, etc. Additionally, Huang (2005) and...
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...competitive advantage lined with each other? 3M, also known as Minnesota Mining and Manufacturing, has several core competencies. First, the rule of allowing 15 per cent of its employees’ working hours has been spent on their own projects. It is the symbol of tolerance for experimentation for 3M. Second, the development of spirit of innovation. The shared characteristics of the trio, the calculated risk-taker, the rule-breaker and the inventor, shaped 3M’s climate of innovation. 3M supplies money for independent research products. For example, 3M launched the Genesis Program to fund research projects unable to go through the regular funding channels. Same for developing unconventional projects that would not otherwise receive funding in the outside world. Technology and ideas are shared through an informal way, such as conversations, but also through a formal way, such as the ‘R&D Workcentre’ and ‘Tech Forum’. Also, 3M has mentors and sponsors who help younger people by listening to their ideas, giving them advice and assistance, and acting as their champions. Patents give 3M the power and time to protect the growth potential of its business. All these thinks develops the spirit of innovation. Third, 3M keeps the functions of engineering, research and development, finance and human resources centralized, while they organise the rest of the company into many small divisions. When a division would grow so big that it tended to overlook the development of new business, new businesses...
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...MGT 106 (Credit hours 3) International Business BBA, Third Year, Sixth Semester Course Objective The course aims to help the students in understanding the basics of international business and its environment, and develop the analytical skills required to compete effectively in this environment. 1. Overview of Global Business 4 hours Meaning of international business and globalization, drivers of globalization, overview of changing global picture: declining trade barriers and change in communication, information and transportation technologies. 2. International Trade Theories 7 hours Adam Smith’s Theory of Absolute Advantage, David Ricardo’s theory of comparative advantage, Heckscher-Ohlin’s theory of factor endowment, Raymond Vernon’s product life-cycle theory, new trade theory based on economies of scale, theory of national competitive advantage: Porter’s diamond. 3. Global Business Environment 10 hours Political, Economic and Legal Environment Political systems: individualism vs. collectivism; democratic vs. totalitarian, legal system: property rights, protection of intellectual property, product safety requirements, economic environment: market economy, command economy & mixed economy, interconnection of political, legal and economic system followed by a country, impact of differences in system on international business. Cultural Environment Meaning of culture, values and norms, determinants of culture: social structure...
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...ABSTRACT In recent years, many companies have increased their presence in the international market. This paper studies the companies need for internationalisation as it focuses on the factors companies must consider before entering new markets or expanding abroad. Many factors that lead companies to invest in the international market have been identified. The research is based on theories. Internationalization factors that motivate companies to establish themselves abroad will be included in the theories. The identified categories include of resource, market, strategic resources, efficiency and seeking motives. Network seeking motives has been identified as an additional motive. The research was conducted based on the qualitative approach. Existing information of related to the motives for internationalisation and the factors to consider before internationalisation were used. The secondary material includes peer-reviewed journals, international business books and research papers. A case study of Chrysodalia Ltd was used to explain the PESTEL and SWOT analysis. Based on the case, it is concluded that companies internationalised in order to increase their competitive advantage. Companies rely on factors, which include Resource seeking, Market seeking, Efficiency seeking, Strategic asset seeking to create competitive advantage in an already saturate market. The factors that the company should consider before internationalising are proactive motivations such as home factors,...
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...SYLLABUS and ASSIGNMENTS International Business Strategy INTL 460 SECTIONS 61 and 81 Fall 2008 Professor Daniel F. Spulber Office 606 Leverone 491-8675 E-mail: jems@kellogg.northwestern.edu International Business Strategy Course Description The course defines the objectives and strategies of international business. The course emphasizes economic analysis of international business strategy formulation. Topics covered include gains from trade, costs of trade, and the competitive strategy of the international business. The course considers alternative modes of market entry, including import and export through intermediaries, contracting with suppliers and distributors, strategic alliances and foreign direct investment (FDI). Case studies are used to illustrate the basic principles of multinational business management and strategy. The course introduces the “Strategy Star” analysis. The first week of the course is dedicated to introducing international business strategy and providing a review of the micro-economics concepts that will be employed during the course. The course then introduces the concept of the ‘Global Value Connection.” This concept is used to develop global competitive strategies that depend on doing business between countries. Weeks 2 and 3 present strategies for providing global added value. The course highlights the economic aspects of gains and costs of trade that are relevant to the international business manager. Weeks 4, 5, and...
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...305 WK 4 ASSIGNMENT 1 INTERNATIONAL ECONOMICS To purchase this visit here: http://www.activitymode.com/product/eco-305-wk-4-assignment-1-international-economics/ Contact us at: SUPPORT@ACTIVITYMODE.COM ECO 305 WK 4 ASSIGNMENT 1 INTERNATIONAL ECONOMICS ECO 305 WK 4 Assignment 1 - International economics Part 1 Write a 4-6 page paper in which you: 1. Explain the concept of comparative advantage and the principle theories of why trade occurs. 2. Analyze and discuss the sources of comparative advantage in national economies. 3. Analyze the international movement of productive factors in order to identify business opportunities and/or threats. 4. Explain the economic effect of tariffs, nontariff barriers, and various forms of trade policies adopted by national governments. Activity mode aims to provide quality study notes and tutorials to the students of ECO 305 WK 4 Assignment 1 International economics in order to ace their studies. ECO 305 WK 4 ASSIGNMENT 1 INTERNATIONAL ECONOMICS To purchase this visit here: http://www.activitymode.com/product/eco-305-wk-4-assignment-1-international-economics/ Contact us at: SUPPORT@ACTIVITYMODE.COM ECO 305 WK 4 ASSIGNMENT 1 INTERNATIONAL ECONOMICS ECO 305 WK 4 Assignment 1 - International economics Part 1 Write a 4-6 page paper in which you: 1. Explain the concept of comparative advantage and the principle theories of why trade occurs. 2. Analyze and discuss the sources of comparative advantage in national economies...
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...competitive advantage of nations: is Porter’s Diamond Framework a new theory that explains the international competitiveness of countries? A.J. Smit ABSTRACT The focus of this article is to clarify the meaning of international competitiveness at the country level within in the context of Porter’s (1990a) thesis that countries, like companies, compete in international markets for their fair share of the world markets. At a country level, there are two schools of thought on country competitiveness: the economic school, which rejects Porter’s notion of country competitiveness, and the management school, which supports the notion of competitiveness at a country level. This article reviews and contrasts the theories pertaining to these two schools of thought with specific reference to trade theories and the ‘theory’ of the competitive advantage of nations originally advanced by Porter (1990a, 1997a, 1998b, 1998c, 2000). Although Porter’s Diamond Framework has been extensively discussed in the management literature, its actual contribution to the body of knowledge in the economic and management literature has never been clarified. The purpose of this article is to explain why Porter’s Diamond Framework is not a new theory that explains the competitiveness of countries but rather a framework that enhances our understanding of the international competitiveness of firms. Key words: Porter, Diamond Framework, international competition, competitiveness of countries, international business, national...
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...motivational speaker. I have been contacted by a national business organization to deliver a two-part seminar on a couple of today’s hottest business topics: Achieving Competitive Advantage and International Business. It is a great pleasure to be standing here in from of all of you today as I share my thoughts on some of the hottest business topics today, which are achieving Competitive Advantage and International Business. Show of hands, how many people feel that competitive advantage in business is an important topic to discuss? As over 90% of the crowd raised their hands, I felt that they were well aware of what competitive advantage is and very interested in my speech today. The other 10% that did not raise their hands will understand more about this business topic and I will address any questions that are necessary. I will begin this speech by defining competitive advantage. It is a position of a company in a competitive landscape that allows the company earning return on investments higher than the cost of investments. The goal is to keep money and sustain its position against competitors. Achieving competitive advantage strengthens and positions a business better within the business environment. As I have given everyone a brief explanation of what competitive advantage is, I will be discussing and connecting international business to competitive advantage. My thoughts on this subject is that upgrading a business system can create a gain in financial and operational...
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...It is a true fact that every business longs for expanding their business to other countries for further development, especially when the business within the country is facing many obstacles. For Blades Inc., the strategy of importing raw materials at cheap cost from Thailand and exporting roller blades to Thailand's market is viewed as a creative and useful idea in order to improve the unfavorable business condition of Blade in its host country, America. This policy suggested by Ben Holt, the company's CFO, is expected to likely bring significant benefits to the company and its shareholders. However, opportunities always come with challenges. The risks for international trade need to be carefully considered to ensure the effectiveness of the import from and export to Thailand. The advantages and disadvantages that Blade could gain from importing from and exporting to a foreign country such as Thailand will be presented in the following manners: a. Advantages Blade could gain from importing from and/or exporting to Thailand As a financial analyst for Blade, I suggest there are two advantages from exporting to and importing from Thailand's market: increasing domestic competitiveness, and sales and profits (Ashish, n.d.). This policy will increase domestic competitiveness, which can dramatically improve the competence level of Blade in the eyes of the opponents. The biggest benefit is clearly shown, as the company can import/export products from/to Thailand at a much lower...
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...The Warwick MBA Assignment Cover Sheet Submitted by : 1268148 Date Sent : 10th December 2014 Module Title : International Business Module Code : IB8180 Date/Year of Module : July – December 2014 Submission Deadline: 10th December 2014 Word Count : XXXXXXX (Excluding Cover, Appendices, Table of Contents, Bibliography, Figures, Tables, Diagrams and Charts) Number of Pages : Question: Using a case study of an actual company, explain the advantages and disadvantages of different international strategies and organisational structures for large multinational enterprises. In your answer you should discuss the relationship between strategies and structures and the conditions under which particular strategies and structures are more or less appropriate. You must also use models of strategies and structures as discussed during the course and presented in the textbook. One example of a case could be IBM’s transformation towards a more global model, but you can choose any similar case as long as some information on the case is publicly available. “This is to certify that the work I am submitting is my own. All external references and sources are clearly acknowledged and identified within the contents. I am aware of the University of Warwick regulation concerning plagiarism and collusion. No substantial part(s) of the work submitted here has also been submitted by me in other assessments for accredited courses of study, and I acknowledge that if this has been...
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...liberalization of the Indian economy are radically changing the business landscape. The international capital flows into India have increased several-fold since the onset of liberalization; Indian companies are becoming multinationals in their own right--a trend certain to intensify in the coming years. All in all, multinationals are becoming more ubiquitous as an instrument of economic and business activity. The business leaders of tomorrow need to be trained today in the unique requirements of multinational management. It is toward this objective that the proposed course in Multinational Management is being offered. The course combines a number of sub-disciplines from the fields of social sciences and business administration. It is broad in sweep; its depth is pitched at the PGP level. The overall course is divided into four modules, as follows: Module I--International Business Context-- provides an historical perspective on globalization and presents a viewpoint on its future direction. It also covers some of the globalization drivers including international trade and investment and how they spawn multinational activity. The phenomenon of domestic and cross-border corruption and bribery, often an inherent part of such activities, is discussed. Finally, it postulates how countries and companies can develop competitive advantage and defines the implications for multinationals as well as host countries. Module II--Business Strategies--begins with the theoretical framework...
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