International Business Finance Essay Example | Topics and Well Written Essays - 1000 words - 1

International Business finance - Essay ExampleIf you have an existing business that creates a tangible product, exportationing is the most reciprocal method. Start-up costs and risks are limited, and benefit whitethornbe realized early on. For some this may be the offshoot a new venture, the other choices are options that may reduce some of the start-up risks. There are ii basic ways to export directly or indirectly. Direct Exporting In direct exporting, your conjunction finds a contradictory buyer and then makes all arrangements for shipping your products overseas. This method requires a lot of footwork and infrastructure, and entails to a greater extent risk, but the potential profit rewards are often higher. If you choose to export directly, you have several options sales Representatives or Agents are essentially, the employees that are hired as foreign-based representatives or agents who work on a fit basis to locate buyers for your product, the same that is done domestic ally. Distributors will strike a deal with a foreign distributor, who purchases merchandise from the organisation and resells it with a mark-up. The distributor maintains inventory and provides after-sales service to the buyer. Indirect Exporting An organisation uses an export intermediary to perform most of the details of the export arrangement. Many small businesses choose this option, at to the lowest degree at the outset. There are several types of export intermediaries Commissioned agents are brokers who link your product or service with specific foreign buyers, allowing the primary company to fulfil the order, handle packing, shipping, and export documentation. Export focusing Companies (EMCs) and Export Trading Companies (ETCs) are companies that operate in the country where the goods export. EMCs generally represent your product to evoke it to other prospective overseas purchasers, while ETCs usually work according to demand, finding a train and sourcing your product for foreign buyers. Both types of companies usually take care of all aspects of the export transaction (including conducting market place research, promoting your product overseas, accessing proper distribution channels, and locating foreign distributors), making them a viable option for littler companies that lack the date and expertise to break into international markets on their own. EMCs and ETCs usually operate on a commission basis, although some work on a retainer basis and some take title of respect to the goods they sell, making a profit on the mark-up. Importing and exporting, on any scale, from a tiny fellowship office or from the World Trade Centre. It is not required to have a license from the linked States government in order to do international trade, but the country with which company does business may require a license. There are several issues needed in an international business cast (Rajan, 1998). Discuss the different types of risk that impact on an organisati on trading on an international basis. political risk arises from the possibility that a host government will take actions harmful to foreign investors or that political turmoil will endanger investments. Political risk are particularly acute in developing countries, where unstable or ideologically motivated governments may attempt to block return of profits by foreign investors or even seize their assets from the host country. An example is Venezuela. President Chavez at the time at a desire to broaden the countrys socialist revolution in Venezuela and issued a