Homeworks academic service


A case study on the challenges and advantages of international marketing

One fundamental consideration is the structure of your organization and the location of your teams. For instance, will your company be run from one central headquarters? If so, how will these teams be organized, what autonomy will they have, and how will they coordinate working across time zones?

If not, will you consider hiring local market experts who understand the culture of your target markets, but will work centrally? Coca-Cola offers one example of effective multinational business structure. The company is organized into continental groups, each overseen by a President. The central Presidents manage Presidents of smaller, country-based or regional subdivisions. Despite its diverse global presence, the Coca-Cola brand and product is controlled centrally and consistent around the world.

While Coca-Cola is a vast international brand, the structure of your business and the number, nationality, and level of expertise of your team will vary depending on your industry, product, and the size of your business. Foreign laws and regulations Along with getting your company structure in place, gaining a comprehensive understanding of the local laws and regulations governing your target markets is key.

From tax implications through to trading laws, navigating legal requirements is a central function for any successful international business. Eligibility to trade is a significant consideration, as are potential tariffs and the legal costs associated with entering new markets. Airbnb ran into trouble inwith a crackdown on advertised rental properties falling outside local housing and tourism regulations. For instance, European countries stipulate that a minimum of weeks maternity leave be offered to employees, while on the other hand, there is no such requirement for U.

With the complexity involved in foreign trade and employment laws, investing in knowledgeable and experienced corporate counsel can prove invaluable.

Beyond abiding by official laws, engaging in international business often requires following other unwritten cultural guidelines. This can prove especially challenging in emerging markets with ill-defined regulations or potential corruption.

In response, companies doing business in the United States must abide by the Foreign Corrupt Practices Actwhich aims at eliminating bribery and unethical practices in international business.

A good rule of thumb is to beware of engaging in any questionable activities, which might be legal but could have future reputational repercussions. International accounting Of the main legal areas to consider when it comes to doing international business, tax compliance is perhaps the most crucial. Accounting can present a challenge to multinational businesses who may be liable for corporation tax abroad. Different tax systems, rates, and compliance requirements can make the accounting function of a multinational organization significantly challenging.

Accounting strategy is key to maximizing revenue, and the location where your business is registered can impact your tax liability. Mitigating the risk of multiple layers of taxation makes good business sense for any organization trading abroad.

A focus on tax efficiency is often the aim of international accounting efforts. In the European Union, companies may benefit from the Common Consolidated Corporate Tax Base proposal, whereby companies with operations around the EU can limit tax liability to one corporate center. Well-known companies with operational headquarters in the Republic of Ireland include Google, Facebook, and Intel.

Cost calculation and global pricing strategy Setting a case study on the challenges and advantages of international marketing price for your products and services can present challenges when doing business overseas and should be another major consideration of your strategy.

International company structure

You must consider costs to remain competitive, while still ensuring profit. Researching the prices of direct, local-market competitors can give you a benchmark, however, it remains essential to ensure the math still works in your favor.

For instance, the cost of production and shipping, labor, marketing, and distribution, as well as your margin, must be a taken into account for your business to be viable. Pricing can also come down to how you choose to position your brand — should the cost of your product reflect luxury status?

Or will low prices help you to penetrate a new market? Swedish furniture giant Ikea, known in Europe for its low-cost value, struggled initially in China due to local competitor costs of labor and production being much cheaper. By relocating production for the Chinese market and using more locally sourced materials, the company was able to successfully cut prices to better reflect its brand and boost sales among target consumers.

AmericanExpress Universal payment methods The proliferation of international e-commerce websites has made selling goods overseas easier and more affordable for businesses and consumers.

However, payment methods that are commonly accepted in your home market might be unavailable abroad. Determining acceptable payment methods and ensuring secure processing must be a central consideration for businesses who seeks to trade internationally. Accepting well-known global payment methods through companies like Worldpayas well as accepting local payment methods, such as JCB in Asia or Yandex Money in Russia, can be a good option for large international businesses.

Accepting wire transfers, PayPal payments, and Bitcoinare other possibilities, with Bitcoin users benefiting from no bank or credit card transaction fees. Despite the risk of fluctuating value, the lack of fees is one of the reasons a number of online companiesincluding WordPress, the Apple App Store, Expedia, and a number of Etsy sellers accept Bitcoin. Currency rates While price setting and payment methods are major considerations, a case study on the challenges and advantages of international marketing rate fluctuation is one of the most challenging international business problems to navigate.

Monitoring exchange rates must therefore be a central part of the strategy for all international businesses. However, global economic volatility can make forecasting profit especially difficult, particularly when rates fluctuate at unpredictable levels.

Market Expansion

Major fluctuations can seriously impact the balance of business expenses and profit. For instance, if your company is paying suppliers and production costs in U. This may mean switching to more local production where possible in order to better balance your outgoings and sales revenue.

Another option for mitigating the risk of unpredictable currency rates can be setting up a forward contract and agreeing a price in advance for future sales.

  1. Simple barter is the least complex and oldest form of bilateral, non-monetarised trade. Swedish furniture giant Ikea, known in Europe for its low-cost value, struggled initially in China due to local competitor costs of labor and production being much cheaper.
  2. Whilst this may not always be the case, in order for your business to be viewed as honourable, it is worthwhile investing in international marketing. Fill in your details to download the report Close.
  3. Effective communication with colleagues, clients, and customers abroad is essential for success in international business.
  4. The need your business may address at home may already be met or not exist at all overseas.
  5. With the complexity involved in foreign trade and employment laws, investing in knowledgeable and experienced corporate counsel can prove invaluable.

Of course, this potentially means missing out on greater profit should rates shift in your favor. However, it can protect your sales from the risk presented by unstable currency. Learn more about six key factors that can influence currency exchange rates: Choosing the right global shipment methods The potential of online sales presents a huge international business opportunity for retailers in the 21st century, but finding reliable, fast, and cost-effective shipment and distribution methods can be a difficult balance in some markets.

Depending on the volume and destination of your shipments, will you send by land, sea, air, or a combination? Your choice of shipping method can be a major influence on your revenue and may be a limiting factor to the products you can viably sell overseas. There are also country-specific regulations and shipping requirements to take into account. For a quick check of costs and compliance, UPS International has created an online tool called TradeAbility to help businesses and individuals manage the movement of good overseas.

Communication difficulties and cultural differences Good communication is at the heart of effective international business strategy. However, communicating across cultures can be a very real challenge. At Hult, developing cross-cultural competency and communication skills are a core focus inside and outside of the classroom.

Effective communication with colleagues, clients, and customers abroad is essential for success in international business.

  1. Choosing the right global shipment methods The potential of online sales presents a huge international business opportunity for retailers in the 21st century, but finding reliable, fast, and cost-effective shipment and distribution methods can be a difficult balance in some markets.
  2. With the complexity involved in foreign trade and employment laws, investing in knowledgeable and experienced corporate counsel can prove invaluable.
  3. Beyond a legal or ethical incentive to be more eco-friendly, establishing environmentally conscious business practices can attract new, forward-thinking consumers to your company. Exporting Exporting is the most traditional and well established form of operating in foreign markets.
  4. In response, companies doing business in the United States must abide by the Foreign Corrupt Practices Act , which aims at eliminating bribery and unethical practices in international business. Do your research and know how different cultural values and norms — such as shaking hands — can and should influence the way you communicate in a professional context.
  5. Because, in most agricultural commodities, production and marketing are interlinked, the infrastructure, information and other resources required for building market entry can be enormous. Businesses can play an important role in addressing modern slavery.

Do your research and know how different cultural values and norms — such as shaking hands — can and should influence the way you communicate in a professional context. Being aware of acceptable business etiquette abroadand how things like religious and cultural traditions can influence this, will help you to better navigate potential communication problems in international business.

Discover the subtle nuances of body language for different countries and nationalities you may be doing business with: It helped me gain perspective towards people from different countries such that I can go to any country and start working without any culture shock. The need your business may address at home may already be met or not exist at all overseas. For instance, American coffee company Starbucks seriously struggled in Australiawhere the demand for local, independent cafes and coffee shops vastly outweighed the appeal of the corporate giant.

Small practical considerations can also be easily overlooked, such as creating quality translations of product and marketing materials, and even ensuring your brand name works well abroad.

A number of well-known companies have had to consider adapting the names of their brand or product when launching in a foreign market. Political risks An obvious risk for international business is political uncertainty and instability.

Countries and emerging markets that may offer considerable opportunities for expanding global businesses may also pose challenges, which more established markets do not. Before considering expansion into a new or unknown market, a risk assessment of the economic and political landscape is critical. Issues such as ill-defined or unstable policies and corrupt practices can be hugely problematic in emerging markets.

Changes in governments can bring changes in policy, regulations, and interest rates that can prove damaging to foreign business and investment. A growing trend towards economic nationalism also makes the current global political landscape potentially hostile towards international businesses. For instance, companies like Facebook are banned in Chinapartially in preference for national social networks and also due to government regulation over internet content.

Monitoring political developments and planning accordingly can mitigate political risks of doing business abroad. Supply chain complexity and risks of labor exploitation When it comes to sourcing products a case study on the challenges and advantages of international marketing services from overseas, managing suppliers and supply chains can also be a tricky process. Unfortunately, the length and complexity of supply chains increases the chance of working with suppliers who have unethical — and even illegal — business practices.

Of growing concern is the risk in international business of forced labor and worker exploitation. To raise awareness and help local and international businesses respond more effectively to this issue, their published research report presents case studies of businesses who have implemented practices at the leading edge of the fight against modern slavery.

As the research team continues to bring their findings to light, developing and supporting ethical and sustainable business practices remains a focus in the Hult classroom.

There was a problem providing the content you requested

Businesses can play an important role in addressing modern slavery. The Ashridge Centre for Business and Sustainability at Hult researches innovative ways that organizations can develop and implement more environmentally sustainable business models. Some key considerations include how your production methods might impact the local environment through waste and pollution.

Beyond a legal or ethical incentive to be more eco-friendly, establishing environmentally conscious business practices can attract new, forward-thinking consumers to your company.

With a number of brands such as DellRenaultand MUD Jeans leading a shift towards the circular economythere is an opportunity and demand for changing production methods and consumer behavior to establish a more sustainable future for the environment and society as a whole.

In the video below, Dr. Mark Esposito discuss the global business and societal benefits of the circular economy: Closing thoughts As we see what the first months of the new year will bring for international business, new opportunities, challenges, and uncertainties will continue to arise. How are you preparing to make the most of the opportunities of doing business overseas in ? Comment below on any further issues or challenges and how your organization is overcoming them. Want to learn more?

Fill in your details to download the report Close.