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University of Puerto Rico in Carolina
English Department
Thesis Statement: The International business strategy refers to plans that guide commercial transactions
taking place between entities in different countries.
Prof. Helvia Guzmán
INCO 4006
Jennie M. Merced

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Outline
I. Introduction
*Thesis Statement:
The International business strategy refers to plans that guide commercial transactions
taking place between entities in different countries.
II. Globalization exist for increased of international business?
III. Methods of doing business in different countries.
IV. Difference between international trade and international business.
V. Multinational Strategy and the cost of expatriot employee
VI. Conclusion

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International business transactions are based on both private and government to market with
more than two countries. These businesses have two main parts, the first is the foreign trade and
which is responsible for regulating the laws and conditions, exchange goods and services. The
second is international trade, is in charge of marketing, import and export, finance and investing
globally directly with companies globally.
This is not only international business, cultural traditions and customs are part of them, for
Americans is not good personal relationships within the business, but if the short- term,
competition. But the Japanese are different like to establish a friendship before doing any
business and also think long term.
External marketing conditions change according to the relations of different countries, which is
why international marketing is quite complicated. This means you need to do studies according
to consumer needs, customs, costs, policies, laws, technologies, etc. . . You have to be at the
forefront especially with prices and product quality. The marketing principles are the same in all
countries, but the planning and the environment vary by country. Ways to acquire foreign
currency, revenues allowforeign investment, debt, improve exports, among others.
The planning is done in an environment of uncertainty. No one can know with absolute certainty
what the internal and external environments of next week will be even much less for years to
come. Accordingly, we develop assumptions or forecasts foreseeable conditions. Some of these
forecasts serve as assumptions for other plans.
The strategic business plan is a map that allows them to target their actions at all times, both in
general and business executives. The plan should be consistent with organizational values with
corporate philosophy and culture. One of the critical in the formulation of the strategic plan is the
aspects of the corporate mission statement, which must be aligned with organizational values.
There are historical origins of this process of chance and transformation and this process can be
traced back to the first eras of mankind. On the other hand a common belief, that globalization
has accelerated after some specific developments, prevails and the globalization process can be
divided into stages according to these developments. As the result of these developments and
stages trade increases in the world and this increase bears,economic, social, political and cultural
effects. While trade furnishes the spanning of goods and services all over the world, it also
generates the spanning of cultures, their interactions and competitions. At this point worldwide
branding, pop stars, similar TV programs are the examples to be thought of. While economic
activities affect cultures, sometimes cultures may shape economic activities.
Opportunities are growing for companies to do business globally. Even small businesses are
claiming their piece of a global market as it expands into a borderless marketplace.

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In fact, an article entitled "How to Grow Your Business Globally" written by Dan Brutto for
Businessweek.com published August 24, 2010 stated, "President Barack Obama's National
Export Initiative, an ambitious plan to double U.S. exports within five years, is helping small
businesses sell their products or services in new markets."
Accordingly, this evidence shows that opportunities are growing for corporations and small
businesses to expand globally, but are large corporations and small businesses seeking to take
their business internationally and compete in the global market? The answer is yes.
Numerous companies both small businesses and large corporations make strategic plans to take
their business internationally because they want to compete in the global market. Today, very
few corporations are not participating doing business abroad. With the internet being a source for
international networking and technology advancing rapidly to support a global economy,
companies find opportunities to do business overseas a feasible and achievable goal.
How do these organizations go international? First, let's define the different types of international
organizations. Often, international companies are called Multinational Corporations (MNC).
MNCs are any international company which operates in multiple countries. As such, MNCs are
categorized as one of the following types:
Multidomestic Corporation - A Multidomestic Corporation disperses management and other
decisions to the local country. With this type of company, operators match their products to local
needs and tastes. This is the reason why some foods taste different from country to country or
some brands offer certain products in one country and not in others. These companies must adapt
their products to the needs, tastes, and desires of local markets.
Global Company - A Global Company concentrates management and decision-making in the
home country. These companies have global holdings but as a global company the organization
treats the world market as an integrated whole in order to promote global productivity and cost
efficiency.
Transnational or Borderless Organization - A Transnational or Borderless Organization disposes
artificial geographic barriers. This type of MNC reflects a geocentric attitude which says "We are
not based any place." The main focus is to increase their effectiveness in a competitive global
marketplace.
Now, that we have defined the types of international companies, let's take a look at how an
organization goes global. An organization goes global through various approaches. These
methods of doing business are used to get into global markets while meeting corporate goals.
Hence, approaches used by companies to go global include:

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Global Sourcing - The Global Sourcing approach to doing business internationally allows an
organization to reach global markets with low investment. In this approach, companies purchase
labor, facilities, or materials from around world. These purchase decisions are based on what is
the most cost effective for the company.
Exporting - When exporting, an organization produces domestically but sells their products
abroad. Small businesses often use this method to do business globally because it requires
minimal risk.
Importing - When importing, an organization acquires products internationally to sell
domestically. This approach is also used by small businesses and involves minimal risk.
Licensing and Franchising - Licensing or franchising consists of giving another organization the
right to use its brand name, product specifications, or technology in return for a fee and a
percentage of sales. With franchising, a company may use another organization's name and
operating methods while licensing involves making or selling another company's products.
Strategic Alliance - Strategic Alliances are partnerships between an organization and foreign
company partner(s) for the purpose of sharing resources and knowledge to develop new products
or to advance production. The most well-known type of strategic alliance is a joint venture.
Foreign Subsidiary - A Foreign Subsidiary requires the most risk for a company seeking to
participate in the global market. A Foreign Subsidiary is operated as an independent office or
facility and may be managed as a multidomestic organization or a global organization.
When companies grow, expand, and burst at the seams in local markets, these companies may
seek to take their business globally. Consequently, a company may use various methods aligned
with their organizations' goals to reach global markets. Each approach is not only designed to
advance opportunities but to control risk and maximize efficiency.
Doing business globally is not a new thing. Taking a company internationally has been practiced
for over a century now. However, new opportunities for small businesses and smaller brands to
take their business abroad are growing every day. As these opportunities become commonplace,
we will find more effective ways to do business in what is becoming a borderless marketplace.
International trade is the trade between two or more different countries. It is just the opposite of
the trade that takes place within a country i.e. national trade. Middle Eastern countries export oil
which is imported by other countries. That is an example of international trade between the
exporting Middle Eastern countries and the importing countries. Thus import and export are two
important components of international trade.

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I don't think that there is actually any term like "International Business" in circulation. If
business is an exchange of commodities and services, then it is well covered by "International
Trade".
Nowadays Multinational corporations are more and more widespread, but a problem that they
still don t have accomplished is how to have successful employees, and most importantly how to
train their employees and make them a useful and successful resource of the their enterprises.
The increase of multinational corporations has led to employees sent in a foreign country to
undertake international assignment more than ever before, with estimation that the use of
expatriate will continue to increase in the future.
Some researchers estimated that around 30% of all expatriates sent to undertake overseas
assignments return home prematurely. And failure rates increase further when is considered also
employees who return home and leave their company within one year.
In conclusion doing business globally is not a new thing. Taking a company internationally has
been practiced for over a century now. However, new opportunities for small businesses and
smaller brands to take their business abroad are growing every day. As these opportunities
become commonplace, we will find more effective ways to do business in what is becoming a
borderless marketplace.