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It means doing business activities or trade with one or more than different countries outside the country boundary or geographical area. It means commercial private transaction and government organization in term of sales investment and logistics. International business lead different parties for their own motives either for profit or any political reason to under take all business activities including import and export crossing borders in goods, services and economical resources
Which consists capital, skills and social political reasons. International trade has a vital role to seek for materials and parts also for international opportunities for the demand of several thing and economic resources which consists of capital, skills, people to give responsibilities for the production of physical goods. Now a days international economy business has some other importance like to enhance to political relationship with other countries like EEC. Although the world wide market has explained greatly to some extent which made the possible with other countries of the world due to the globalize economy of the world. Business transaction like finance, banking, insurance, these are the main keys sectors for varies countries where international has liked with other countries to trade on permanent basis. Forty years ago international trade was very difficult between the countries by the reasons of political, communication, and social and cultural restrictions. Creation of European Economic Community (EEC) it tried to open trade barrier between the twenty three countries who participate actively in economy growth of the EEC and free trade among the members of EU. United Kingdome as the member of the EU has developed business with several countries like China, India, Sri lanka only few shortlist to WU where there is no barrier in the members. UK imports and exports the goods and services from other countries which are not the members of the EEC.
International organization is very important for the local economy. We have multinational enterprises where the customers have a lot of varieties of their own choice.
Competition on various channel of production have modern approach to meet the requirements in more than one country. We have a number of foreign businesses throughout the countries such as, McDonald, Kentuky, and Nado. We have a range of foreign fast food business in different sectors.
International business is impartial and has give the consumers more choice to get access of multiple goods. On the other hand some counties have limited international business because of government restriction to protect the home country's market to protect job of the citizen. Sometimes home business is disappeared due to the arrival of foreign investors. Thus protection of local business is important to secure jobs an investment political measures are essential to enhance the production of the local industry.
2. Explain what strategic Alliances.
Meaning of strategic Alliance.
Discuss the potential benefits of strategic Alliances.
Advantages and disadvantages.
A strategic alliance is acquiring to or more parties into a relationship to meet a business need. It might be with in the local market or at international level. Distribute different resources. The partners get both support and collaboration. This organization is proved to be beneficial.
Strategic Alliance has to undergo different stages to form the formation process involving these steps.
Strategy development: Before contracting an alliance an organization to carry strategy development for different objectives.
Partner assessment: it is essential that each organization has to assess strengths and objectives the contract will contain the contribution, performance termination for each partner.
Alliance operation: it has to involve the personal commitment, finding which is suitable for the needs of the organization and assessing the performance to find out how much alliance has been benefited to the organization.
Alliance termination: An alliance is terminated if the objectives are not met and the partner is not supporting the company.
Planned coalition is so useful to organisaton in terms of revenue. When we build a team its aim is to agreement a grouping between organization to work vested in partner's expertise for the interest to maximize profit. According to economist Michael porter has critics that an 'alliances and I take much the same vie, an alliances should be an excellent one. The principle of the business is to survive which has to rely in other expertise to hire someone who is good at this duty. Parties are to advantage from the alliance.
He obviously explains that one may not have the skill toward but an alliance will get more gain in other project. To develop the lack of specialized knowledge, thus benefiting the advantage.
There may even be situations where the grouping colleague might take over the other company. A small piece alike to opening the door to attract your assassin inside. The most uncovered groups I believe the most to the danger of alliances are government entities who are often completely devoid of any expertise in the field of the alliance partner.
The advantages of strategic alliance include:
Allowing each colleague to focus on tricks that top match their capabilities.
knowledge from associates & rising competences that may be more broadly exploited elsewhere
Benefiting from the income & competencies of an organization for it to stay alive.
3 Select an international company on your own choice and analysis the strategies adopted by the company for entering markets.
'Fucosa International Group' is an worldwide organisation based in Barcelona, Spain dealing with constituent of automotive industry targeting small number of place market concentrating on manufacture of face sight, rearview mirrors system and electronic windshield cleaning systems. The company manufactures a manual and automatic with extremely stylish system. The company has been manufacturing the products for more than sixty years employing about 6,550 employees with sales of £1.1 billion per yearly. It has been measured as globe head in the group manufacturing concerning 20 million mirrors per annual. It has penetrated worldwide market after achieving a great success business in the Spain.
International market entry is regarded as a desperate mission because very frequently global face market opposition in term of competition, government policy, market attention and order of the market, pricing, common and artistic result. Change of government policy in economic improvement in entry of overseas speculation is one of the main reasons that carry the enormous of mirror manufacture to discover the worldwide market.
1983, Fucosa leftovers the major provider of apparatus but still to remain secure and certain and gain market share, after arrival of foreign investors like General Motor. Fucosa has spin into far-off market and has been surveying the European market by an independent company to do explore as one of the policy adopted to go through the market. But after addition of Spain in European Union the Directing Manager M. Pujol concluded in Financial Time that his business has to exist or vanish.
Ficossa penetrated the Portugal market in the year 1992 and one of the policies that the organisation applied was growth of new manufactured goods - generating automotive gearshift systems, as a supplementary for the real product. Release the creation to win the market divide and then utilize the casement to start on the first product of the organisation is an approach to enter the new market. The company has purchased one of France Company Maurice Lerroy S.A and has expanded to different area in Europe.
The company registered with the name of Fico Cipa In 1991, extended the production of automotive mirrors for French industry which became new market foremost organisation to race with the direct competitors. In the same year the Spain giant has bought in United Kingdom building and builds a plant of 21, 000 square feet in the town of Tanworth, West Midland. Investing particularly in different market has been main point to go through a market to win the market share of the competitors.
Every market has to be diverse proceeds to enter the market. Ficossa has stimulated to Romania to develop the market business to a lower pay markets. Romania market is one of the targets for inexpensive labor which will decrease the cost of manufacture and promotion of goods at low value which will add a large share.
Getting the Chinese market is the development of the company and an attempt to go through the Asian market. Fricossa make a deal of 70 percent share of the Shanghai Benyuan a foremost company in manufacture of mirrors for the Chinese and new market. Ficossa managed to move the majority of its contracts to Shanghai Plant plus the supply deal with PSA and General Motors and ahead a new agreement with Volkswagen Polo In 2006 later than achievement of the contract.
Chinese plant has prolonged and launches a latest supplementary product in 2004, to influence the market for latest manufactured goods to win the market share.
Ficossa plan to succeed market divide and build up into world market head the majority debatably to become brand name in the manufacture of automobile components. Through the 2005 the organisation sales has soar to EUR 825 million. This shape shows that Fricossa has been flourishing in leading the worldwide market in discerning automotive component niches. Furthermore, the company has been on the progress to added development of the market. The organisation has now focused in joint ventures approach to focus on exploring new market.
Fricossa prepared a combined venture with one of the leading company in 2003.Fractus to get the benefit of its technology to structure the Advance Automotive Antennas. During the 2005 Ficosa was the only trader of the corporation to expert into produce of automotive GPS (Global Positioning Systems) and Portable Telephone Reception. In the similar year another cooperative project contract was protected with Hyundai Corporation a South Korean and AV company of Russia.
While winning the Asian and European marketplace has set up a trade product to go through the market in a variety of area of the worldwide market. Being an global organisation Fricosa targeted the American, Mexican, Canadian market as an chance to spend because the government policy draw investors has an inspiration feature to go there. Pujol, the company director knows at the start that the American market will be hard but it was distant more simple than thinking because its gap with the European market.
Ficosa establish and gained a vast market share due to agreement and focusing on growing a new generation manufactured goods and investing in research technology and continue on opposite with clients insist and requirements. Market development has been a key aim of the organisation from investing, merging and a stabbing with a latest creation while in front of many obstacle.
4 Evaluate the tools and techniques used by the selected company in assessing international business success.
SWOT Study of Ficosa organisation. Ficosa, Rear-View Mirror Systems Division position amongst the top three suppliers in the world. The sharing out is unrivaled in the worldwide market, built-up 20 million units per annum, covering key markets plus Europe, Asia, NAFTA and Latin American markets. Ficosa has been victorious organisation in guiding the market diffusion plan to suit a flourishing business in global market.
Business letdown is constantly connected to awful administration which can difference the political feature of Firosa Company in running this organisation by Pijol, showed quality, visualization and ability to products its creation to global level. Management and Leadership is the significant machinery to arrange a vast company like Ficosa in order to become a world leader. Achievement began when vary in Spanish Political policy to exert a pull on the foreign savings into the country.
Investing to a diverse market is not touching out but to discover new market. This pace is an important instrument to seek for foreign market. Savings to diverse market was the key aim of Ficosa industry although the sales in the market have rocketed in same period. Portugal was good example for Ficosa to spotlight in global business relatively than to give a start. Smaller market related to Spain but it was a huge benefit to study the market. Ficosa plan seems correct to spend straight to the marketplace by selling a plant. This technological asset has quickly showed the effect in language of earning. Targeting Asia, Europe and America market has extended establishing a global massive in automobile mechanism.
It is necessary for the organisation to recognize all lawful and communal necessity to go on onward with any firm development. Abroad government strategy is vital for Ficosa to spend in that country as well as enchanting into deliberation the cultural and social factors. Many countries which have not doing enough to draw far-off investors in term of facilities, supply of labour and change in legal policy.
Ficosa has been much verified to combine with offered company as in China which is a communist country where far-off investors find it hard to acquire into the market due to communication fence and language. Shanghai Plant in China is a great example that allowed Fricosa to make an gaining of 70 per cent share of Shanghai Benyuan industry which make the company to use this instrument to go in the Chinese market. Government policy in China evaluate to other state is hard to arrangement a business immediately, although, constricting a joint venture with one of the organisation is adhering the policy and system of the state in working global business.
Ficosa grouping with other organisation will assistance at all level counting in making sequence and unrefined materials provide which will profit the organisation as the colleague area in this field will be a giant benefit. Ficosa has been winning organisation globally with key point in 1983 when the Spanish government opens for foreign investment which was risk to survive. Addition of Spain in EU was one of the steps which have leaded the company as the world massive to overcome the worldwide market.