International Business & Management
International Business & Management
International Business & Management
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Lernkarten
Explain Porter's 5 Forces
1. Competition in the industry;
2. Potential of new entrants into the industry;
3. Power of suppliers;
4. Power of customers;
5. Threat of substitute products.
What is a company?
- A company is a legal entity made up of an association of persons, be they natural, legal or a mixture of both, for carrying on a commercial or industrial enterprise.
- A company fulfills customers need
- The output should be greater than the input
What is meant by USP?
USP is your Unique Selling Proposition within the company. It shows what particular benefit someone gets by buying exactly your product instead of what your competitors offers.
Which are the 6 different kinds of international business?
- Offshoring
- Exporting and importing
- Foreign Direct Investments (FDI)
- Licensing
- Joint ventures
- Wholly-owned subsidiary
Explain "Offshoring"
Transfer activities to countries where the work will be done more cost-efficiently
Explain "Foreign Direct Investment"
Build up facilities or manufactures in a different country and manage them directly. Profits stay within the new company abroad (ownership or controlling)
Explain " Exporting and importing"
Exchanging goods and services across boundaries
Explain "Licensing"
- A company abroad buys the licence (or patent) to produce a product which is invented somewhere else. Eg. A company in China has the right to produce Philip Morris cigarettes from USA, and is self-responsible for risk and investing in manufacturing.
- Franchising works quite similar, but the company abroad has to follow tight conditions about quality and working procedures. Eg Mc Donalds, where even the buildings have to be as in USA.
Explain "Joint ventures"
A joint venture (JV) is a business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task. This task can be a new project or any other business activity. In a joint venture (JV), each of the participants is responsible for profits, losses and costs associated with it. However, the venture is its own entity, separate and apart from the participants' other business interests.
Explain "Wholly owned subsidiary"
Hundertprozentige Tochtergesellschaft
A wholly owned subsidiary is a company whose common stock is 100% owned by another company, the parent company.
Enumerate and explain the kind of companies (7)
- Small and Medium Sized Enterprises
- No common definition to SME (KMU’s)
- Generally, no turnover of more than 250 mil and no more employees than around 200
- EG: PB Swiss tools, Car-Garages
- International Enterprises
- They import and export, but do not invest in other countries
- Orgapack
- Multinational Enterprises
- Based in one country, but have significant production and marketing in many others. Manager in the home country make major decisions
- Eg. Toyota
- Transnational Enterprises
- Operate in many countries, but have local managers who make decisions. Thus, the knowledge to make business is local, but the image is worldwide
- Eg Nestle
- Global companies
- Operate in many countries, production or service are performed and integrated in many global locations. Thus, the ownership controls and manages, but each sector is quite independent.
- Eg. Novartis
- Born Global
- Normally KMU’s who have a special organisazion which is made up particular to benefit from the competitive advantages from different places.
- Eg. Google, Skype
- Born Again Global
- This companies were first made up on a local scale, but then opened up on a international skale
