Articles-now.com The Basic Principles And Goals Of International ...

While international business can be a vague term, it usually refers to the totality of transactions and investments that take place between two organizations separated by different political boundaries. Simply put, it is the business done between two different countries.

In essence, it stands for business conducted between different nations. This can be between governments or, more commonly, between different companies that have their bases of operations in separate countries. The process usually involves the trading of goods and services, as well as capital and qualified workforce.

This process is very valuable to world economics, especially when it involves dealings between governments. A lot of countries have valuable commodities that they can export in order to generate income. Consequently, they might lack certain resources which forces them to import other goods or services from nations qualified to provide them. A good example of this is oil, which is the most valuable resource on the market today. All countries that have rich deposits of petroleum will generate a lot of revenue from exporting it worldwide.

These activities can be done for different reasons. Most private companies do it strictly to gain a profit. Governments do it for profit, as well as establishing international relations and following certain political ideologies. There are non-profit organizations that extend their business across the borders in order to offer assistance or to raise awareness of an issue.

The success of this process has led to the appearance of MNEs or multinational enterprises. These global giants have established a presence in more than one country and often they have stores or restaurants all over the world. Good examples of MNEs are car manufacturers, electronics developers and fast-food restaurant chains.

One of the biggest issues with this type of transaction is the different barriers encountered between two separate nations. First is the language issue, which is usually easily resolved. When a company wants to extend to another region they must take into consideration the local culture in order to establish if they might be successful or not. Furthermore, nations have separate and distinct laws which pertain to the regulations of import and export, trade agreements, labor standards etc. In order for a company to be successful on an international level, it must be aware of all the rules and regulations of each nation where it does business and abide by them.

The biggest reason why organizations have found international success is globalization. There are several key factors that have sped up the entire process. Technological advancements have made it easier for people to communicate and to travel to distant places. Consequently, the consumers now know of the presence of foreign goods and they demand them. As a result, most governments have lifted restrictions pertaining to international dealings.

International business is a process that is flourishing at the moment. The reason is simple: there is a demand and companies are happy to supply it. All future projections show that this phenomenon will only get bigger.

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Source: http://www.articles-now.com/2011/08/the-basic-principles-and-goals-of-international-business/?utm_source=rss&utm_medium=rss&utm_campaign=the-basic-principles-and-goals-of-international-business

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