Concept of international business environment

Presentation on Concept of International Business Environment which includes:
1. Difference between International Business and International Business Environment
2.Difference between Domestic Business and International Business
3.Entry Modes of International Business
4.Nature of International Business
5.Advantages of International Business
6.Classification Of International Business Environment
(a) Micro and Macro Environment
(b) Domestic, Foreign and Global Environment
7.Components Of International Business Environment with examples.
To watch more ppt follow our channel.

1. CONCEPT OF INTERNATIONAL BUSINESS ENVIRONMENT BY:- PINKI VERMA

2. Difference Between International Business And International Business Environment International Business :- It is the purchasing and selling of the goods, commodities and services outside its national borders. International Business Environment :- It refers to the surrounding in which international companies run their businesses.

3. Difference between Domestic Business and International Business : S.NO DOMESTIC BUSINESS INTERNATIONAL BUSINESS 1 It refers to the business where economic transactions are conducted within the geographical boundaries of the one country. It refers to the business where economic transactions are conducted across border with several countries in the world. 2 Buyer and seller belong to same country. Buyer and seller belong to different countries. 3 Deals with single currency. Deals with multiple currencies. 4 Nature of customers is homogeneous. Nature of customers is heterogeneous. 5 Degree of risks are low. Degree of risks are high.

4. Entry Modes of International Business Import and Export Licensing and Franchising Outsourcing and Offshoring Joint Venture and Strategic Partnership Multinational Company Foreign Direct Investment

5. Nature of International Business Complexity Interdependence Dynamic in nature Inter-relatedness Impact Uncertainty Relativity

6. Advantages of International Business Helps in the expansion of business Helps in to increase employment Exposure to more customers Important source of earning foreign exchange Helps in improving the standard of living Help in mutual growth Helps in the proper management of the product life cycle. Helps in improving GDP of nation Attract foreign direct investment

7. Classification Of International Business Environment Micro and Macro E nvironment Domestic, Foreign and Global E nvironment

8. Micro and Macro Environment MICRO ENVIRONMENT MACRO ENVIRONMENT Meaning It refers to the environment which is in direct contact with the business organization and can affect the routine activities of business straight away. The general environment within the economy that influences the working, performance, decision making and strategy of all business groups. Elements COSMIC i.e. Competitors, Organization itself, Suppliers, Market, Intermediaries and Customers. PESTLE i.e . Political, Economic, Socio-cultural, Technological, Legal and Environmental. Are these factors controllable? Factors are controllable by the business but to some extent only.  Variables are uncontrollable. Influence   Directly and Regularly Indirectly and Distantly

9. Internal Environment It comprises the firm's business strategy and decisions with regard to production, finance, marketing, human resources and research activities. Since these strategies and decisions are entirely made by the firm, they are considered as controllable elements. Domestic Environment Domestic environment means the environmental actors and forces existing and operating at national level. It consists of factors such as competitive structure, economic climate, political and legal factors which are essentially uncontrollable by a firm. Domestic environment affects firm’s domestic as well as international business.

10. Foreign environment Foreign environment means the factors and forces operating in a foreign country or countries with whom a firm in domestic economy wants to have international business. It consists of factors like social, political, economic, legal and cultural prevailing in a foreign country. The firm can neglect them only at the cost of losing business in the foreign markets.

11. Global environment Global environment means the factors operating on worldwide basis or regional basis. Global environment is not confined to just one country but entire world or a group of countries. Hence , the impact of global environment is visible in a home country as well as foreign countries. It comprises of forces like world economic conditions, international financial systems, international agreements and treaties and regional economic groupings.

12. Components Of International Business Environment Political Environment Legal Environment Economic Environment Financial Environment Socio-cultural Environment Technological Environment Ecological Environment Demographic Environment

13. Political Environment Political environment constitutes the type of government, the relationship between the government and the business & the political risk in the country. There could be a dictatorship, one party system (single party system), democracy, constitutional monarchies and so on. Political factors include:- Form of Government and Political Party System Political Ideology and Role of Government tax policy environmental regulations trade restrictions and reform Tariffs political stability

14. Legal Environment The international laws shall be binding in the case of a dispute are:- Host country laws Home Country Laws The legal systems that exist in different countries of the world are antecedents of one of the two legal philosophies Common law Code (Civil) law This generally includes legal factors such as: Copyright law Fraud law Discrimination law Health and Safety law Import/Export law

15. ECONOMIC ENVIRONMENT Economic environment refers to all the external economic factors that influence buying habits of consumers and businesses and therefore affect the performance of a company. Income levels need to be taken into account as they provide an indication of the purchasing power of the market and allow companies to adapt their marketing concepts accordingly Some examples of economic factors affecting business are Interest rates Exchange rates Recession Inflation Taxes Demand / Supply

16. Financial Environment A financial environment is a part of an economy with the major players being firms, investors, and markets. Monetary and Fiscal Policies:- Inflation , interest rate, various kinds of duties and exchange rates are the variables related to the country's monetary and fiscal policies Balance of Payments Account:- Controls on movement of foreign exchange into and out of their economies

17. Socio-Cultural Environment International business must appreciate how foreign culture is different from their home country’s culture and how this difference is to be reflected in their business strategies. There is a wide variety of social and cultural factors, some of them being : Level of education Religion and beliefs Consciousness about health issues Social classes Structure and size of a family Language Aesthetic Attitudes and values Different lifestyles

18. Technological ENVIRONMENT As technology continues to advance, companies can benefit from these breakthroughs or face challenges in competing with them. Some of the most common technological factors are: New product development New organisational styles New management techniques New marketing techniques New production techniques Networks , warehouse management, electronic data interchange ( EDI) Web/Internet

19. Ecological Environment Ecological factors influencing business are connected to actions and processes necessary to protect natural  environment. The GOI has drawn up an Environmental Green technologies, green products and green companies are highly valued in today’s global market place. Ecological factors are:- Climate change Pollution Weather Availability of both non-renewable and renewable resources Laws that regulate the environment Survival of particular biological species

20. DEMOGRAPHIC ENVIRONMENT Demographic environment refers to a country's climate , topography, natural resources and people. Common demographic variables to consider :- Size , growth rate, age composition, sex composition etc. of the population Family size Economic stratification of population Education level Caste , religion etc..