Risks Associated With International Business Transactions Economics Essay

Risks Associated With International Business Transactions Economics Essay International business has appeared in the history to satisfy the need of merchandises from long distance nations , it was an international trade . It begins in the 19th century BC where it has appeared in Assyrian merchant colony in Cappadocia . Camels allows Arab to move spices and silk from far east and trade it , establishing the silk road which make a connection to trade Chinese and Indian goods with the Romanian empire goods .Vasco de gamma ( Portuguese explorer ) has established a sea route between Europe and India . As international trade extent to reach all nations , the necessity of regulations or an international business law has been raised . The main convention for international trade was the united nations convention on contracts for international sale of good (CISG) which established by UNCITRAL (United nations commission on international trade law) . International Business Law involves two parts , private and public law , the private law related to international business transaction like international trade , finance trade , licensing and distributing agreements . the public law related to agreements that help to create a legal framework which international business takes place ( e.g. Treaties , Customs , Tariff.. ) International Business Transactions A business transactions begins when a buyer and a seller agree the terms and conditions to purchase a specific goods with a detailed quantity and price ( contract of sale ). In this contract , from the buyer point of view what is essential is to gain the ownership of the goods , for the seller what is important is to have the legal terms that provide receiving money . An International business transactions differ from domestic business transaction , because its usually include long distance which means higher risk in goods transiting , which mean higher insurance , how money will be transferred and who is responsible of the goods delivery , all that should be included and clearly in international business transaction contract . import Export trade Imports are goods or services that are made or grown abroad then purchased or receipt by the importer and distributed domestically . Exports are goods or services that are made or grown inside the nation then sold or rendered by the exporter to be distributed abroad The need of export import trade generally is because on country has an advantage over others in specific items , some countries have comparative advantages like manufacturing (ex. Germany , japan .. ) others have comparative advantage in natural resources like oil or gas ( ex. Saudi Arabia , Russia ) . Exporting can be direct or indirect .Direct exporting is when the manufacturer take the responsibility of most of the export processes , usually they use Foreign sales representative or foreign distributer in the exported country .Indirect exporting is when a company use intermediaries ( export trade company , export management company ) to enter the foreign market , usually happen because lack of capital or because the company do not have the needed experience to enter this foreign country . Trades usually governed by the laws and regulations of the trade countries , they use tariffs and non-tariffs barriers , this reflect the way that companies trade with each country . In 1947 nations accept General Agreement on Tariffs and Trade , this movement occurred to liberalize trade by reducing tariffs and non-tariffs barriers . in 1995 WTO (World Trade Organization ) has been created to manage the rules and assist settling the trade disputes between WTO nations . foreign Direct Investment Foreign Direct Investment is when a company invest its workforces and resources to purchase or to build an operation in another country . those company called MNC (Multinational Corporation) . Countries usually welcome FDI because MNCs has many impacts over hosts country economics and political system . FDI is a major decision for any company because its full of costs and risks . MNCs companies has many ways to enter the market of a foreign country considering of many factors like capitalization , legal considerations and market condition, MNCs decide to enter foreign market as Joint Venture , Mergers , Subsidiaries or Acquisitions . When a firm owned 100% by a foreigner , its a wholly owned subsidiary . A joint venture is an organization that is created by two or more companies or with the foreign government they share risk and assets , companies use joint venture to reduce the risk of entering foreign market . ( e.g. Peugeot France has a joint venture with Dongfeng Motor China) A strategic alliance is an agreement between competitors to achieve common goal .(e.g. Airlines Coding share ) Licensing , Franchising Licensing is an agreement where the Licensor (Firm) grants a Licensee (Foreign Firm) the right to use its intellectual property ( patent , logo, formula , etc.) .Licensing can be completely within one country , but its a way that companies use to distribute its products with minimum risk taken , where there is a percentage of profit paid by the licensee to the licensor . Franchising is a form of licensing which the Franchisor (parent firm) offers equipment , material , trademarks , technology à ¢Ã¢â€š ¬Ã‚ ¦ to the Franchisee (investor) , in the other hand the franchisee should pay a fee or a percentage of the profit to the franchisor .(e.g. McDonalds) Franchising is a good way to inter the foreign market because the franchisee will provide the capital for investment and the management and franchisee will deal with customer and labor problems , franchising usually associated with many legal requirements , it depends on the country , un US the federal trade commission is regulating the franchising . in other hand in china they eliminated most of the restriction on franchising . rISK aSSOCIATED WITH INTERNTIONAL BUSINESS TRANSACTIONS sTRATEGIC rISK Strategic risk means the risk of weak or bad strategic decision concerning the competitiveness the firm in the foreign country , its the risk of misanalysing of the porters five forces which are the threat of new entrants , threat of substitute products or services , Bargaining power of customer , Bargaining power of suppliers and the intensity of competitive rivalry . Usually MNCs companies is more concerned about this risk , where a well done study of the market is required before entering the foreign country . An example of a company which failed In the strategic risk consideration . Political risk International managers should understand the substantial effects of political decision making in country before beginning its business , and understand how political decision making can influence its business . Political movements and instability can make it difficult to the company to operate well . International manager should be aware of the ideology of the host country , the economic system ( communism , socialism ,capitalism ) and the political system ( democratic , totalitarianism ) and the structure of the host government , a risk of embargos and sanction of trades which usually used for political pressure rather that economic issues .Understanding the stability of host country political system can avoid many risks , a new and hostile government may replace the friendly relationships and hence expropriate foreign assets .The firm most understand the regional stability and international affairs of the host country . The firm can do political risk analysis to assist in firm deci sion making . operational risk Operational Risk is the risk concerning operational activities , machineries breakdown , supply of resources, logistics and inventory problems .By establishing a good operational risk analysis and evaluation , companies will be able to reduce operational loss, pre-detecting of illegal activities , reducing auditing costs and reduce exposures to future risks , and that well lead to reduce waste and improve processes , it will develop lead-time and add to efficiency in international business . In export Import international transaction , a delivery risk is an operational risk , where a buyer didnt receive ordered goods , it can happen because of workers strike , or delay in the shipment . One form of delivery risk is property risk , and its a loss or damage to the goods before they arrive. The risk of Pilferage can affect all types of trade transaction , specially import export one, this has been a problem for many years , a new way of boxing (cargo) and new technologies entered this sector to minimize the risk of pilferage . country risk When the firm decided to do business broad , it should consider the basic infrastructure needed for the firm operation , that what country risk means . Roads , Bridges and telecommunication, crime rate and corruption , internal conflicts or civil unrest and the economic condition ( unemployment rate , unskilled labor force etc. ) , terrorism , in the host country all that can make it difficult to enter or do business safely ,effectively , efficiently in that country . Country risk can be the Language and Cultural differences and the risk of exposure to foreign law and courts , a Lack of language differences awareness can cause many problems that will end in courts , an example of that , what happened in1975 , United states district court , between Gaskin (US citizen) and Stumm Handel GMBH (German company ) , an employment contract written in German has been signed by Gaskin ,who has no knowledge about German language . technological risk Lack of security in electronic transaction , absence of information technology infrastructure and the cost of rapidly developed technology , all that will result creating problems that will affect doing business in the host country . environmental risk Environmental risk may lead to damage the reputation of the Firm if firms function resulted pollution ( Air , water , environment .etc.) and that will cause risk to the firm .And vice versa if the host country has pollution , that may cause health problem to firms employees . economic Financial risk Changing in domestic fiscal or monetary policies , devaluation or inflation rate , GDP , unemployment rate and the ability of the host country to meet financial obligations , all that make an Economic risk that should be careful understood before conducting international business . In this area, Currency exchange rate can have big effect over international trade and investment decisions taken by the firm . Fluctuations in foreign country currency can diminish profits when the firm convert them back to home currency , some countries may create rules that will minimize the flexibility of the firm to send money outside the country , hedging strategies could mitigate some of the currency exchange rate. In export-Import international transaction a financial risk can be a payment risk , where the buyer will fail to pay for the ordered goods , it will costs a lot specially if the cost of shipment is so high (Because of sensitive or heavy shipments ). Summary The International Business environment has changes a lot in the last decades , with the high competitiveness of international market , International mangers now a days should be aware of economic , political , culture and other differences in the world to be affective in his position . The three main international business types , export-imports , FDI , and Licensing and franchising. In each type of them there are risks that should be considered and pre-determined to be able to build and plan a good strategy that will minimize any risk that may face firm international business.

Television Vs Movies Essay -- essays research papers

Before there was television and motion pictures (movies), people used to spend their leisure time listening to the radio. They were offered little variety and often routinely listened to the same things. In the late 1800’s and early 1900’s, motion pictures and television were invented, respectively. In the beginning, they were considered luxuries. As time wore on, they became increasingly more and more popular. Today they are both extremely common forms of entertainment. Though they are both very popular, they are also very different.   Ã‚  Ã‚  Ã‚  Ã‚  Going to the movies offers a complete escape from everyday life for a few hours at a time. In movies, a story can usually be told from beginning to end in a short period of time. Movies allow a person to get completely wrapped ...

Strategic Plan, Part III: Balanced Scorecard

The objectives for are derived from the mission statement together with our company aim to provide our clients and their customers with the most flexible and effective customer relations services and protecting the relationship between a recognizable brand name and the customers that are served. The mission statement clearly outlines what is important to our clients, their customers and lastly what is most important to LLC. A satisfied customer is paramount to the success of our clients. This objective is only achieved by the professionalism, caring and the understanding by the call center agents that we are the first line of customer interaction that represents the client company. Our position in the process must leave a desirable first impression upon the client customers. Our management team grasp of a body of knowledge pertaining to the call center industry will continue to nurture a work-force that is being primed to provide impeccable customer relations services to an expanded field consisting of retailers in every industry of service. The role of the call center is growing in the service industry. Our vision statement recognizes the position of call centers as technological advances are made to deliver superb customer service relations. Technology will be the deciding factor in achieving objectives. The larger customer relations firms are poised to continue out-sourcing their services which leaves a void for customer service relations opportunities in the United States. Our vision to continue to grow our work-at-home program is a strategic measure and a competitive advantage that we feel will continue to set us apart from the competition. The overall logistics of the work-at-home program must be modified to ensure the success of the candidates that desire to service client customers from home. This program is a key objective to future growth for our organization. The vision demands continual training and innovation that will formulate an already client and customer friendly service to a business model that will expand to other areas of retail industries. The SWOTT analysis showed strength in the areas of intellectual property and a business model that has a focus on work-at-home moms. These two objectives will be the driving force that will allow LLC to strengthen the profitability, efficiency and productivity of our clients. There is also an expectation for an increase in market share which will provide added incentives to our employees and management team. A key component of the SWOTT analysis is in the technological design of the latest equipment that will set the precedent moving forward for the industry. The knowledge that is required to implement the newer systems has always been an advantage for our management team. Any threats from competitors will be thwarted by the increase in market share and the ability to implement and provide training for the newer systems which will be done in-house. Any strategic advantage that can be attained must be sustained. The SWOTT analysis can not be over emphasized nor should it be downplay the threats to an organization. It has been utilized as a tool that will give our organization the best internal analysis that shows what is possible internally in light of the external factors.

Nike and Apple

This paper looks at two global brand names that have teamed up to make a new product for sports consumers. These are Nike and Apple. Nike is well known corporate brand associated with manufacture of Nike shoes while Apple is known for the manufacture of small and durable computer gadgets used in the music industry, the iTunes music store. Due to growing trend of consumers liking of their brand they have developed Nike+iPod Sport Kit that embraces two technologies that are divergent in nature but uniquely complementary to sports use. The Nike+iPod Sport Kit is able to capture athlete’s data, store it and interact with other gadgets useful for sports training. The use of it and other older devices have contributed to the success and potential of the merger between Nike and Apple companies. NIKE AND APPLE Nike and Apple are brand names of companies dealing in two different market fields. Nike has established itself as the dominant figure in sport shoes while Apple is the dominant the filed of computer technology where they have build a solid base in the music play list. Nike brands are Nike shoes that are the darling and much sought after shoes from sports consumers. While Apple has the dominant iTunes music store in which athletes have been uploading music. Since music is synonymous with athletes during training, the CEOs of these two companies came with a partnership to deliver a product of its kind (Lab paper main source). The CEO of Nike first approached Apple’s CEO with the ‘smart running shoe’ idea it was processed and a new idea referred by Apple’s CEO as ‘great start’ was born. This is a combination of two technologies that would improve the performance of the runners. The partnership which was labeled ‘design difficulties’ embraces a phenomenon that has already been ventured by other companies however, great improvement have been made. Thus Nike and Apple came up with the product called Nike+iPod Sport Kit. This is where an electronic sensor is embedded on the shoe which relays signals to the receiver connected remotely to the Apple’s iPod of the nano music player (Lab paper main source). The data is loaded in it of which information like distance covered, speed of the runner, calories burned during the training and can be customized to give details with specificity such as setting of ‘power song’. The iPod stores information on duration, distance covered and calories utilized during running time. The data is then transferred to a Mac or computer to which it uses the Nike website, Nikeplus.com where the runner can view data on the screen, analyze his progress, customize goals and show results later. This kit allows the runner to get feedback through the iPod speaker, and listen to music as he or she trains (Lab paper main source; Lab paper supporting material 2). The accuracy of this gadget is quite precise at over 90 percent even when used outside the box. For instance Armstrong used it during his training and tested with car speed and found that the nano recorded 5.2 miles while the speedometer recorded 5.3 miles (Lab paper supporting material 2). As a matter of fact the two companies brought this synergy of ideas based on the ‘beautiful friendship’ level to which there association has brought similarities and differences in harmonious integration.   For instance, Nike and Apple are similar because they leading global brand names in their field of specialization that is the buzz of young and cool consumer market. Two they are all technologically driven whereby the apple is known for semiconductors and software proficiency while Nike is force behind anatomy, precision molding as well as thin film technology. This is illustrated by one of the CEOs who termed it ‘scratching the surface of technology’ where they can only be limited by the scope of imagination and business deal. It is a merger that is transcending to a field that has not been touched hence showcasing the huge potential opening for further development (Lab paper main source). Therefore,   Nike has   rolled out   an expansive development of seven other styles of   Nike branded shoes in the near future which include Nike air zoom moire, Nike shox, Air max lines, Plus ready   and Nike plus. Plus ready brand is already in market with at least 4 million shoes being sold in stores (Lab paper main source). The development of technology did not happen without the obstacles as admitted by the executives’ of the two companies. On is that it took them eighteen months to come to agreement on the best platform dubbed Zen state. The problems being the sensor in the Nike shoe was bigger which was not welcomed by Nike engineers but the Apple designers saw it as small. Secondly the duration of the battery was short at about 1000 hrs. This was because the wireless technology to be employed consumed a lot of power and none wanted wire connection. However, it brought out a gadget that could be beneficial to all at an affordable price of $29 for iPod, $ 149 for nano and $100 for the shoe. This brings the question of affordability of the product to the consumers compared to previous product from companies like Garmin handheld GPS which its cost range from $115 to $377 depending on its sophistication (Lab paper main source). The partnership of two companies carries great benefits to both as indicated by their market share experiences. For instance, Nike will be solidifying its presence on the MP3 payer market having unsuccessfully tried through collaboration with Philips electronics. Apple being the dominant player gives Nike the presence and avenue it needs most. While Apple is gaining ground on a new field hence making iPod become a platform in sport market rather than as a music player. Nike profile will be elevated due to its connection with Apple and their market share will expand similarly because of similar demographics. Although some criticize the apple deal arguing that it is nutty others opposed it vehemently. For the case of Philips electronics where they have had long brand-licensing agreement it will still hold (Lab paper supporting material). This is not the first time Nike is penetrating the MP3 player market because they have done so with Philips electronics and co-branded the PSA 610, 4 GB hard disk with GPS sensor. This market has had other products of similar nature such as use of wristwatches, heart rate monitors, pedometer and cycling computers. The polar’s line of heart rate enabled athletes and cyclist to set up, training regimens where data can be viewed on the computer and results analyzed. The Garmin forerunner which had a hand held GPS connected to the wrist or in edge lines provided real time tracking of location from the GPS.   Mac’s gadgets were used to interface computers and internet including the use of polar and Garmin models. Therefore as the new product are developed old gadgets such as Mac’s solidify their ground (Lab paper supporting material). CONCLUSION This paper has discussed the merger of two global brand names that are successful in their area of business. Their merger has created a new market and potential of technological collaboration as well as boost in market share consolidation. REFERENCE Lab paper main source article Lab paper supporting material Lab paper supporting material 2

soft drink industry essays

soft drink industry essays When there is industry there is competition. The bigger the player, the harder they can play. The big players always try to consume many of the small competitors. When they do this they can expand their market share. A perfect example of this is the soft drink industry; Pepsi and Coke have always been archrivals. They are always trying to gain market share, by absorbing many smaller beverage companies to appeal to the public. This paper will discuss the history between these two industry giants and how they financially stand at this point, plus how supply and demand effects this industry. Coca Cola was invented by an Atlanta pharmacist John Pemberton in 1886. His bookkeeper, Frank Robinson, named the product after two ingredients, coca leaves and Kola Nuts. By 1895 the product was available in all 50 states. By 1916 the Company was sold twice, had over 1000 bottlers, and was publicly traded (Dow Jones, Coke). During World War II, the president of Coke Woodruff said, "every soldier will have access to a 5 cent bottle of coke"(Dow Jones, Coke). The company received government aid to build 64 overseas bottling plants during that time. This is how Coke began its ties with many foreign markets. Caleb Bradham, a Pharmacist from North Carolina, invented Pepsi. He Called it Pepsi Cola because, he claimed it cured Dyspepsia or more commonly known as indigestion. He registered the trademark in 1903. Pepsi tried to follow the same root as Coke by signing up bottlers, by 1923 Pepsi was on its last leg until Loft Candy Company bought it in 1931. It increased its bottle size but kept its 5-cent price. In 1939 it introduced its first radio jingle (Dow Jones, Pepsi). Pepsi had a rough start compared to Coke, and always tried to rise out of the shadow of this industry giant. "According to Coca-Cola Company, the two most famous expressions in the world are ok and Coca-Cola" (Dow Jones, Coke). The world's largest soft drink Company, Coke has...

Two Journals Movie Review Example | Topics and Well Written Essays - 750 words

Two Journals - Movie Review Example The case of Na’vi humanoids, however, is way beyond a frightening state of dominion from species of other forms, for humans in this regard would be found the emerging culprits whose greed causes perils even upon the unseen world. Even though the Na’vi possess looks and stature that are nearly dreadful, the feelings they convey are deeply heartfelt it almost moves me to tears while watching some scenes that exhibit tribe members communicating warmly with each other. Like real humans, they manage to deliver thoughts and emotions in a sensible manner just as how Jake Sully under his avatar suit is able to derive fruitful and solemn interactions with Neytiri. It is greatly fascinating to see that instead of anticipated mysteries or mystic potentials, creatures of another dimension are revealed as almost equal to men in strength, intelligence, and general capacity in coping with love, fear, and hatred. Despite all the wonders and beauty to marvel at in the Pandora’s biosphere, science-oriented humans have reached that stage of discontent in simply navigating cosmic systems. It turns out they desire moreover to explore and gain further knowledge to meet intellectual objectives even at the expense of the moon’s habitat. This is something that makes me reflect on human nature at depth especially when it comes to the extent to which greed among humans may proceed just so the amply increasing demands on human economy are satisfied. The film exemplifies a future possibility when men are no longer astonished by the exquisite sights and encounters of the wonder-filled nature whether on this planet or in a region of outer-space yet to be fathomed. How awful indeed it is to realize when human beings become consumed with covetousness whereby as long as we are conscious regarding the adjustable measure of our potentials, there seems no room for rest until

Managing organizational transition Essay Example | Topics and Well Written Essays - 1000 words

Managing organizational transition - Essay Example A transition in an organization is crucial for the business to thrive. Factors such as competition and demands by customers affect the transition in an organization. They are perceived to bring better services, innovative products and improve the efficiency of the organization. A well-planned transition sees to it that there is improved competitiveness, an encouraging financial performance, and most importantly an excellent customer and employee satisfaction. Most organizations have invested their time, energy and resources in the management of organizational transition management. The management of organizational transition has been known to increase an organizations power to accelerate the transitions process and to capitalize on the opportunities presented by the transition process. For the effective management of an organization, the company needs build their organizations capability to initiate change and facilitate rapid transitions (Durant 5). Durant also suggests that an organization needs to do away with processes that do not add value. Durant also believes that organisations, change agents should come up with a vision, which reflects on the groups energy the vision should be able to link the present and future. Durant looks at the initial stage during a transition, which he calls the unfreezing stage. He argues that this stage involves unlearning of past behaviours he explains that the organization at this stage experiences disconfirmation, which is an incompatibility between two or more attitudes. He suggests that the organisation needs to reduce the discomfort I agree with Durant, which changes most of the time causes discomfort. Usually it does not only happen in an organization, but also in all aspects of life, a comprehensible form of illustration would be a student who changes schools. In a new schooling environment, one is not at ease and tries so much to fit into the new system for some