CHAPTER 1 OVERVIEW OF INTERNATIONAL BUSINESS.pptx - MGT 361...

MGT 361 International Business
Chapter 1:
An Overview of International Business

By end of the chapter, students should be able to :
✔
Understand the meaning of International Business
✔
Identify and describe the basic forms of
International Business activities
✔
Identify the reasons why firms doing International
Business
The chapter objectives:

*
IB consists of business transactions between
parties from more than one country
*
The business transactions includes:
*
Buying materials in one country and shipping them
to another for processing or assembly (like Apple
company)
*
Shipping finished products from one country to
another for retail sale (like high-end cars such as
Ferrari)
*
Building a plant in a foreign country (Samsung)
*
Borrowing money from banks in one country to
finance operation in another
What is International
Business?

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Individual
*
Investors and businessmen
*
Companies
*
Private or public
*
Company Clusters
*
Alliance, subsidiaries, associates
*
Government Bodies
*
Central Bank
*
International Institution
*
World Bank, International Monetary Fund
Participants

The Difference between Domestic
Business
and International Business
Domestic Business International Business
Within boundaries of a single country . Cross national boundaries.
Business transaction is usually done in
local currencies .
The countries involved use different
currencies . At least one party has to
convert its currency into another.
Business partners only comply with local
legal systems. Imposed by the government.
Legal system may differ in each
countries. One or more parties have to
adjust in order to comply with local law.
Business management is easier in local
environment. Only a local cultures
Different cultures in various countries will
force once party to adjust their
international business management.
Local business are usually done according
to availability of resource in the country
alone.
Availability of resources differs by
country.

*
Career Opportunities
*
To be prepared for a career in any facet of business world
*
Start own Business
*
Doing business with partners from other countries
*
Job Assignment
*
Work for a firm that is owned by corporation headquarters in
another country
*
To keep pace with future competitors
*
To ensure that you have global skills and knowledge to aid
your career
*
To keep track of latest business instruments
*
IB and companies keep improving their technologies,
methods, processes and skills in conducting the business, so
do we
*
Cultural literacy
*
Understand and appreciate the similarities and differences of
various cultural backgrounds
Why study International
Business?

International Business
Activities
Importin
g
Internation
al
I
nvestment
Licensi
ng
Franchisi
ng
Management
Contracts
Exportin
g
FD
I
P
I

•
Exporting and Importing
• Export