Case Question

1. What is the nature of international business environment Harley faces? What types of risk does the firm face?
The nature of international business environment Harley faces is domestic and international with complexly and risk involve. This is clearly shown in the variation of sales in its two major markets, one at home in the U.S and the other in Europe. As shown in the in the graph chart in 2006, Custom models accounted for 47.4% in the U.S while only 13.4% in the European market. Other sales based on style of bikes are in the U.S performance 15.1%, touring 35.5%, and standard 2.1% while its other market sales in Europe were performance 41.4%, touring 26.1%, and standard 19.2%. The reason Harley faces such diversification is clearly due to consumer preferences. The European markets desires performance bikes made for the open roads and high speed demands. The four main risk which are cross-cultural risk, country risk, currency risk, and commercial risk.

2. How can Harley benefit from expanding abroad? What type of advantages can the firm obtain? What advantages acquired abroad can help Harley improve in its home market?
Harley’s can benefit from expanding abroad because it will allow them to separate their business from domestic economic slumps, but also diversifying their product to adjust with the demands of the consumers. The advantages of expanding international sales include maintaining a more sensible business archetype. By increasing internationally Harley can widen its international appeal and have less focused on one particular section of the world in particular. An international growth can also push Harley into new evolving markets such as China, India, and Brazil which have very large populations and many potential