Ch. 4 – International Business https://www.youtube.com/watch?v=VMwjscSCcf0 – Cultural differences in Business, China Focus

Taking Care of Business.. In other countries?! Culture: the sum of a country’s way of life, beliefs and customs Ways it impacts business: Dealing with people, punctuality, greetings, nonverbal communication, manners, decision making etc.

Culture activity! You will each be assigned a country and be giving tips on how to introduce yourselves Your task is to introduce yourself to your classmates in that culture and try to guess where each other comes from

International Business Business transactions necessary for creating, shipping, and selling goods and services across national borders

International Business Domestic Transaction selling of items produced in the same country. International Transaction selling of items produced in other countries Think about it: WHY DO WE DO BUSINESS INTERNATIONALLY? WHAT ARE THE BENEFITS? International transactions (foreign trade) involve creating, shipping, and selling foods and services across national boarders. The global economy is the exchange of goods and services among people in different countries throughout the world.

Benefits of International Business 1. Access to Markets Markets are 200 times larger than those at home. Global Product standardized item that is offered in the same format in all countries. Ex. Soccer ball BENEFITS FOR BUSINESS? Access to Markets Examples of standardized, or global product are pencils, soccer balls, and cameras. Packages food items are not generally global products. Businesses must make adaptations to their products and services to be successful in other countries. Cheaper Labour Canadian businesses, in an attempt to lower costs of production, use cheap foreign labour to maximize profits.

Benefits of International Business 7 2. Cheaper Labour Lower prices #1 reason BENEFITS FOR BUSINESS? Access to Markets Examples of standardized, or global product are pencils, soccer balls, and cameras. Packages food items are not generally global products. Cheaper Labour Canadian businesses, in an attempt to lower costs of production, use cheap foreign labour to maximize profits. 7

Benefits of International Business Increased Quality of Goods Country may be expert 4. Increased Quantity Can produce more BENEFITS FOR BUSINESS? Increased Quality of Goods Products such as luxury cars as parts manufactured in many different countries come together to form the finished product. Increased Quantity Companies may have to increase production to meet demand, this may means increased efficiency, longer hours of operation or the establishment of new facilities. Access to Resources Natural Resources: bamboo from China to make furniture Human Resources: cheap factory labour in India Capital Resources: specialized machinery made in Germany

Benefits of International Business Access to Resources Access to natural, human, and capital resources BENEFITS FOR BUSINESS? Increased Quality of Goods Products such as luxury cars as parts manufactured in many different countries come together to form the finished product. Increased Quantity Companies may have to increase production to meet demand, this may means increased efficiency, longer hours of operation or the establishment of new facilities. Access to Resources Natural Resources: bamboo from China to make furniture Human Resources: cheap factory labour in India Capital Resources: specialized machinery made in Germany

Five P’s of International Business 5 Major reasons for doing international business (5Ps) Product More variety Price May cost less depending on foreign wages, taxes etc. THE FIVE Ps OF INTERNATIONAL BUSINESS As businesses expand internationally they create jobs at home and overseas. Knowledge that is exchanged, as a result of international business, it results in new approaches to production, marketing, and selling that benefits domestic consumers as well as producers. Political benefits also materialize, dialogue and understanding are improved and communication and respect are enhanced. All countries benefit when businesses produce specialized goods and services that appeal to consumers. International business provides increased markets for businesses and offers them a broader choice of products, services, and prices for its consumers. Product Due to out geographical location and seasonal climate change Canada imports crops (such as citrus all year and strawberries in the winter) from other countries. Canada exports products such as timber and grain that we have an abundance of. Price Lower production costs may mean lower prices for consumers, causing increased units sold, therefore improved profits. Proximity Historically trade between countries was heavily dependant on proximity; the closer a business or individual that you traded with the greater an asset they were to you or your business.

Five P’s of International Business Proximity Neighbouring country’s – easy to trade Ex: 80 percent of the Canadian population lives within 170 km of the American border. THE FIVE Ps OF INTERNATIONAL BUSINESS As businesses expand internationally they create jobs at home and overseas. Knowledge that is exchanged, as a result of international business, it results in new approaches to production, marketing, and selling that benefits domestic consumers as well as producers. Political benefits also materialize, dialogue and understanding are improved and communication and respect are enhanced. All countries benefit when businesses produce specialized goods and services that appeal to consumers. International business provides increased markets for businesses and offers them a broader choice of products, services, and prices for its consumers. Product Due to out geographical location and seasonal climate change Canada imports crops (such as citrus all year and strawberries in the winter) from other countries. Canada exports products such as timber and grain that we have an abundance of. Price Lower production costs may mean lower prices for consumers, causing increased units sold, therefore improved profits. Proximity Historically trade between countries was heavily dependant on proximity; the closer a business or individual that you traded with the greater an asset they were to you or your business.

Five P’s of International Business Preference Based on reputation and specialization Ex: Swiss watches, Belgium chocolates. THE FIVE Ps OF INTERNATIONAL BUSINESS Preferences Some foreign products that Canadian consumers purchase due to preference are Belgian chocolate, Swiss watches, Australian wine, German cars, and Cuban cigars. Promotion Before global communication methods (such as satellite broadcasting and the Internet) businesses found it difficult to let others far away know about themselves. According to Interbrand Corp.’s website a business can develop a global brand name in three years by using the Internet. Easy promotion is an incentive for companies to create an international presence.

Five P’s of International Business Promotion Technology has made international promotion easier THE FIVE Ps OF INTERNATIONAL BUSINESS Preferences Some foreign products that Canadian consumers purchase due to preference are Belgian chocolate, Swiss watches, Australian wine, German cars, and Cuban cigars. Promotion Before global communication methods (such as satellite broadcasting and the Internet) businesses found it difficult to let others far away know about themselves. According to Interbrand Corp.’s website a business can develop a global brand name in three years by using the Internet. Easy promotion is an incentive for companies to create an international presence.

Where do your clothes come from?

Where do your clothes come from? For your shirt, pants, & shoes, find out what country they were made in. Do your best to figure out an exact country, or at minimum give an approximate location.

Doing Business in china Video - Handmaster Questions to think of: What are some of the challenges of business in China? What benefits will he get by doing business in China?