Benefits and Challenges of International Business
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- Category: Politics: Economics
- Date Submitted: 12/02/2010 12:00 PM
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Jomo Kenyatta University College of Agriculture and Technology
Faculty of Business Studies and Management
2nd Trimester 2010
Masters in Business Administration
INTERNATIONAL BUSINESS
TOPIC: BENEFITS AND CHALLENGES OF INTERNATIONAL BUSINESS
NAME: Mwaluda Danson Mwambela - CBDM-HD333-1479/2010
THE ASSIGNMENT IS PREPARED AND SUBMITTED TO JKUAT IN PARTIAL FULFILLMENT FOR THE DEGREE OF MASTERS IN BUSINESS ADMINISTRATION (MBA)
BENEFITS OF INTERNATIONAL BUSINESS
1. Increased Market Opportunities
An international business is a business headquartered in one country bus has operations in one or more other countries. The fact that the business has ventured in other countries increases the market opportunities for the organization. The organization has access to many more customers. Increased markets in turn lead to increased sales and hence profits. In addition the increased market gives an opportunity to the organization to extend the potential of its existing products. The organization cuts a niche for itself in the international arena and gains a global market share.
2. Diversify the Risk and Uncertainty of the Domestic Market
When a business ventures into another country it shares its risk of operation between its domestic and foreign markets. If the domestic market does not do well or declines for any reason, the organization still has its foreign market to count on. This is important especially when the markets are seasonal e.g. tourism. In summary, international businesses reduce the dependency on the existing markets, and stabilizes seasonal market fluctuations.
3. Response to Foreign Competition
International businesses respond to foreign competition by opening multinational enterprises (MNEs) in the home country of their competitors. In the process of doing this, the organization in turn protects its domestic market and enhances its domestic competitiveness.
4. Cost Reduction/Competitiveness
International businesses...
Faculty of Business Studies and Management
2nd Trimester 2010
Masters in Business Administration
INTERNATIONAL BUSINESS
TOPIC: BENEFITS AND CHALLENGES OF INTERNATIONAL BUSINESS
NAME: Mwaluda Danson Mwambela - CBDM-HD333-1479/2010
THE ASSIGNMENT IS PREPARED AND SUBMITTED TO JKUAT IN PARTIAL FULFILLMENT FOR THE DEGREE OF MASTERS IN BUSINESS ADMINISTRATION (MBA)
BENEFITS OF INTERNATIONAL BUSINESS
1. Increased Market Opportunities
An international business is a business headquartered in one country bus has operations in one or more other countries. The fact that the business has ventured in other countries increases the market opportunities for the organization. The organization has access to many more customers. Increased markets in turn lead to increased sales and hence profits. In addition the increased market gives an opportunity to the organization to extend the potential of its existing products. The organization cuts a niche for itself in the international arena and gains a global market share.
2. Diversify the Risk and Uncertainty of the Domestic Market
When a business ventures into another country it shares its risk of operation between its domestic and foreign markets. If the domestic market does not do well or declines for any reason, the organization still has its foreign market to count on. This is important especially when the markets are seasonal e.g. tourism. In summary, international businesses reduce the dependency on the existing markets, and stabilizes seasonal market fluctuations.
3. Response to Foreign Competition
International businesses respond to foreign competition by opening multinational enterprises (MNEs) in the home country of their competitors. In the process of doing this, the organization in turn protects its domestic market and enhances its domestic competitiveness.
4. Cost Reduction/Competitiveness
International businesses...