International marketing can be a tricky business. With the increase in global trade, international companies cannot afford to make costly advertising mistakes if they want to be competitive and profitable. Understanding the language and culture of target markets in foreign countries is one of the keys to successful international advertising. Too many companies, however, have jumped into foreign markets with embarrassing results. Out of their blunders, a whole new industry of translation services has emerged. Faulty Translations The value of understanding the language of a country cannot he overestimated. Translation mistakes are at the heart of many blunders in international advertising. Since a language is more than the sum of its words, a literal, word-by-word dictionary translation seldom works. The following examples prove this point. Otis Engineering Company once displayed a poster at a trade show in Moscow that turned heads. Due to a poor translation of its message, the Continue reading
International Business
International Business Management deals with the maintenance and development of a multinational operation across national borders, whose manager has the knowledge and the skills to manage and handle cross-cultural processes, stakeholders and business environments in a right way.
Achieving a Sustainable Competitive Advantage
“If you don’t have a competitive advantage, don’t compete.” – Jack Welch A company has a competitive advantage when its profit rate is higher than the average for its industry, and it has a sustained competitive advantage when it is able to maintain this high profit rate over a number of years. Maintaining a competitive advantage requires a company to continue focusing on the four generic building blocks of competitive advantage – efficiency, quality, innovation, and customer responsiveness – and to do whatever is necessary to develop distinctive competencies that contribute toward superior performance in these areas. “Competitive advantage is at the heart of a firm’s performance in competitive markets. After several decades of vigorous expansion and prosperity, however, many firms lost sight of competitive advantage in their scramble for growth and pursuit of diversification. Today the importance of competitive advantage could hardly be greater. Firms throughout the world face Continue reading
Steps in Conducting a Foreign Market Analysis
International businesses have the fundamental goals of expanding market share, revenues, and profits. They often achieve these goals by entering new markets or by introducing new products into markets in which they already have a presence. A firm’s ability to do this effectively hinges on its developing a through understanding of a given geographical or product market. To successfully increase market share, revenue, and profits, firms must normally follow three steps, Assess alternative markets Evaluate the respective costs, benefits, and risks of entering each, and Select those that hold the most potential for entry or expansion. 1. Assessing Alternative Foreign Markets In assessing alternative foreign market a firm must consider a variety of factor including the current and potential sizes of the markets, the levels of competition the firm will face, their legal and political environment, and socio-cultural factors that may affect the firm’s operations and performance. Information about Continue reading
Types of Marine Insurance Policies
Marine insurance is a contract by which the insurer, in consideration of payment by the insured of a specified premium determined under tariff rates or otherwise, agree to indemnify the latter against any loss incurred by him in respect of the merchandise exposed to the perils of the sea or to the particular perils insured against. In a c.i.f. contract, marine insurance is obligatory, and the policy must be one which is usual in the trade and is in a negotiable form. The policy must be stamped and bear a date not later than that of the bill of lading; and if the export is under a letter of credit, it must conform to the terms and conditions laid down in it. Types of Marine Insurance Policies 1. Single Cargo Risk / Open or Blanket Policy A marine insurance policy may be a “single cargo risk” policy, i.e., a policy Continue reading
Types of Packing Credit (Pre-Shipment Credit)
Packing Credit is a pre-shipment credit extended to the exporters to facilitate him for meeting several financial requirements such as purchase of raw materials and its processing, packing, storing and shipping of goods. It is a short term credit available to all exporters. Hence, this is called pre-shipment credit which is essentially working capital finance made available to the exporters to arrange for goods as per the export. It is generally granted in the form of loans or cash credits. It may also be granted in the form of overdraft facilities. The exporter who wants to avail the pre-shipment credit facility should make a formal application to his bank along with the firm contract with the buyer or a copy of the export order or a copy of the letter of credit. Major Types of Packing Credit Pre-shipment finance is available in various forms. Important types of packing credit are Continue reading
Decentralized Decision Making in Multinational Enterprises
Where does the decision making power in Multinational Enterprises (MNEs) rests? Is the decision power vested with the parent’s headquarters or with the subsidiary? Decisions made at the foreign-subsidiary level may be considered decentralized, while those made above the foreign-subsidiary level, that is the parent level, are considered centralized. The location of decision making power may vary within the same company over time as well as by product, function, and country. In addition, actual decision making is seldom as one-sided as it may appear. A manager who has decision-making authority may consult other managers before exercising that authority. Centralized decision making is a global strategy while decentralized decision making is a multi-domestic strategy. A combination of the two is called a transnational strategy. The reason for choosing one over the other is partly a function of companies’ attitudes. For example, an ethnocentric attitude would influence a company to develop competencies, Continue reading