|
|
This is only a preview of the paper
Click here to register and get the full text.
Existing members click here to login
|
|
|
The decision to internationalise a company’s operations will have the overall objective of increasing the sales and profit figures of a company. ... I will examine the extent to which risks are more abundant in countries in the developing world and decide whether the benefits from introducing operations in markets in the developing world will be best decision as opposed to internationalising in markets of developed world countries. ...
Political risk is concerned with the political stability in potential markets and the possibility that the government could create significant changes to the country’s business environment which could subsequently have an adverse effect on the performance and success of a business operating in the market. ... This goes to show that expanding operations into a totalitarian state, which are now only found in developing countries, has an extremely high level of risk due to political influence and would not be recommended. ... The level of risk can vary with the extent to which these problems are expected to change the business environment of a country and therefore the extent to which the problems will have a negative effect on a business operating in the economy. Economic mismanagement can be identified by high levels of business and government debt in a country and also by high levels of inflation rates. ...
Economic risks can arise from the costs of internationalising operations into a foreign market. ...
Legal risks are an area which companies will have to investigate before engaging in international operations. ... An example of legal matters causing problems with international business in a change in the Indian legal system in the 1970s which required all foreign investors to enter into joint ventures with Indian companies. ...
Cultural differences between countries can have a major impact in the way which business is conducted. ... Ethnocentric behaviour is the belief that one’s culture or ethnic background is superior to another and cause bad relations in business.
Approximate Word count = 1569
Approximate Pages = 6.3
(250 words per page double spaced)
|
|
|
|
|
|