By: Shelly Singhal

 When business activities are performed on an

international level, these can be termed as
international business.
 Basic functions, processes and techniques of
international business are essentially the
same as those involved in domestic business.
 What is different is the environment within
which these functions are performed and
processes are carried out.
 International Business environments are
unfamiliar and different from the domestic
environment
 These variations may need adaptation for
business success.
 In the context of a business firm, environment
can be defined as various external actors and
forces that surround the firm and influence its
decisions and operations.
 The two major characteristics of the
environment as pointed out by this definition
are:
1. these actors and forces are external to the
firm
2. these are essentially uncontrollable. The firm
can do little to change them
 Intra Firm Transactions using transfer pricing
is common
 Varying Environment-Political, legal,
economic , socio-cultural and ethical-in host
countries ,often not known to the firm.
 Presence of exchange rate risk often leading
to financial risk.
 Varying strategies of business in different
host countries.
1. Accurate Information
2. Information not only accurate but should
be timely
3. The size of the international business
should be large
4. Market segmentation based on geographic
segmentation
5. International markets have more potential
than domestic markets

1. International Marketing
2. International Finance and Investments
3. Global HR
4. Foreign Exchange Market
5. International Trade
6. Regional Economic Integration and
Cooperative Agreements
 To Expand Sales
Volkswagen(Germany),Ericsson(Sweden),IBM
(United States),Nestle(Switzerland)
 To Acquire Resources
 To Minimize Risk
 To reduce cost (Availability of cheap labor,
Raw material etc.)
 Domestic market constraints
 “White Skin” Advantage.
 Severe competition in the home country
 Falling trade barriers
 Rapid expansion of Technology
(Transportation & Communication)
 Liberalization of government policies on
cross border movement of trade and
resources
 Development of institutions that support and
facilitate international trade
 Increased global competition
 Political& Legal Differences
 Cultural Differences
 Economic differences
 Differences in Currency units
 Differences in the language
 Differences in the marketing infrastructure
 Trade and investment Restrictions
 High Transportation costs
 Differences in business practices
 High foreign investments and high cost
 John Daniel-International Business
 Vyuptakesh Sharan-International Business