Evaluate the success of the strategies and resources used by a selected internatonal business in one
of its markets
All businesses are required to come up with strategies for the operatons of their business, however
it is much more important for internatonal business to adopt many diferent strategies essental for
the running of the business in diferent internatonal markets. Strategies have to be designed for
each operatonal aspect of the business and have to be made specifcally for each market. As well as
thinking about strategy and the way in which any internatonal business wishes to expand, another
critcal area that the business needs to review before choosing its fnal strategy for expansion, is
resources.
Internatonal business strategy refers to plans that guide commercial transactons taking place
between enttes in diferent countries. Typically, internatonal business strategy refers to the plans
and actons of private companies rather than governments as such, the goal is increased proft.
Selling into internatonal markets is increasingly atractve for UK businesses. Some of the reasons
for this are:
- Stronger economic growth in emerging economies such as China, India, Brazil and Russia
(BRICs) and Malaysia, Indonesia, Nigeria & Turkey (MINT)
- Market saturaton and maturity (slow or declining sales) in domestc markets
- Easier to reach internatonal customers using e-commerce
- Greater government support for businesses wishing to expand overseas
There are 8 methods for businesses to invest in internatonal markets, and these are:
Subsidiary businesses
A subsidiary business is one where the parent company has got a holding in its shares of 50 per cent
or more. It is controlled by the parent company but can operate in another country. The subsidiary
has to follow the laws of the country in which they are based and pay relevant taxes and other
business expenses accordingly.
There are 2 ways to establish a subsidiary business of a parent company:
- A business can be set up in the new country as a subsidiary of an existng company
- An existng business can be taken over
In terms of legal liabilites, the subsidiary business operates in its own right so this means that it has
its own legal liabilites. There are benefts to buying and, therefore, owning a subsidiary for
internatonal operatons:
- Limits risks
- Good controls in place to expand the business internatonally
- Supply chain relatonships and supplier networks are purchased as they are existng
Joint ventures
A joint venture is when two or more businesses come together by contractual arrangement to focus
on a partcular business transacton or deal. Businesses enter into joint venture to reduce risk and
share expertse. A company that produces and item may enter into a joint venture with a trading
company as their businesses complement each other. Another type of joint venture might be an
arrangement between a producer and a supplier of goods.
of its markets
All businesses are required to come up with strategies for the operatons of their business, however
it is much more important for internatonal business to adopt many diferent strategies essental for
the running of the business in diferent internatonal markets. Strategies have to be designed for
each operatonal aspect of the business and have to be made specifcally for each market. As well as
thinking about strategy and the way in which any internatonal business wishes to expand, another
critcal area that the business needs to review before choosing its fnal strategy for expansion, is
resources.
Internatonal business strategy refers to plans that guide commercial transactons taking place
between enttes in diferent countries. Typically, internatonal business strategy refers to the plans
and actons of private companies rather than governments as such, the goal is increased proft.
Selling into internatonal markets is increasingly atractve for UK businesses. Some of the reasons
for this are:
- Stronger economic growth in emerging economies such as China, India, Brazil and Russia
(BRICs) and Malaysia, Indonesia, Nigeria & Turkey (MINT)
- Market saturaton and maturity (slow or declining sales) in domestc markets
- Easier to reach internatonal customers using e-commerce
- Greater government support for businesses wishing to expand overseas
There are 8 methods for businesses to invest in internatonal markets, and these are:
Subsidiary businesses
A subsidiary business is one where the parent company has got a holding in its shares of 50 per cent
or more. It is controlled by the parent company but can operate in another country. The subsidiary
has to follow the laws of the country in which they are based and pay relevant taxes and other
business expenses accordingly.
There are 2 ways to establish a subsidiary business of a parent company:
- A business can be set up in the new country as a subsidiary of an existng company
- An existng business can be taken over
In terms of legal liabilites, the subsidiary business operates in its own right so this means that it has
its own legal liabilites. There are benefts to buying and, therefore, owning a subsidiary for
internatonal operatons:
- Limits risks
- Good controls in place to expand the business internatonally
- Supply chain relatonships and supplier networks are purchased as they are existng
Joint ventures
A joint venture is when two or more businesses come together by contractual arrangement to focus
on a partcular business transacton or deal. Businesses enter into joint venture to reduce risk and
share expertse. A company that produces and item may enter into a joint venture with a trading
company as their businesses complement each other. Another type of joint venture might be an
arrangement between a producer and a supplier of goods.
