1. International Business Organizations
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2. Goals Discuss activities of multinational organizations.
Explain common international business entry modes.
Describe activities of international trade organizations and agencies.

3. Multinational Companies
AKA: MNC
Are organizations that do business in several countries.
Has a parent company located in a home country
Has divisions or separate companies in one or more host countries.

4. Multinational Strategies
Global Strategy: uses the same product and marketing strategy worldwide.
The same product is sold in essentially the same manner throughout the world.
Example: Coca-Cola
Multinational Strategy: treats each country market differently.
Products and marketing strategies are developed to adapt to the customs, tastes, and buying habigs of a distinct national market.
Example: restaurant chains adapt their menus

5. Multinational Benefits
Consumers have a large amount of goods available at a lower price
Career opportunities also expand as a company does business in a variety of countries
May foster understanding, communication, and respect among people of different nations.

6. Multinational Drawbacks
The MNC cam become a major economic power in a host country
Workers depend on jobs
Consumers become dependant on MNC services and products
May influence or control the political power of the country

7. Global Market Entry Modes
Licensing – selling the right to use some intangible property ( production process, trademark, or brand name) for a fee or royalty.
Franchising – the right to use a company name or business process in a specific way.
Businesses are set up that look and run like the parent company
Both involve a royalty payment for the right to use a process or company name.

8. Global Marketing Modes (Cont.)
Joint Venture: an agreement between tow or more companies to share a business project.
Main benefit is the sharing of raw materials, shipping facilities, management activities, or production facilities.
Concern: the sharing of profits and not as much control because several companies are involved.
Example: Ford Motor Company & Mazada Motor Company. (Japan & U.S.)

9. International Trade Organizations
Created to help companies with global trade activities.
World Trade Organization (WTO):
Created in 1995, more than 150 members
Lowering tariffs that discourage free trade
Eliminating import quotas
Reducing barriers for banks, insurance companies, and other financial services
Assist poor countries with economic growth

10. International Trade Organizations
International Monetary Fund (IMF)
Established in 1946, with more than 150 members
Helps to promote economic cooperation
Maintains an orderly system of world trade and exchange rate
Before IMF a country could often change the value of its legal tender to attract more foreign customers
Makes trade wars less likely

11. International Trade Organizations
World Bank
Was created in 1944 to provide loans for rebuilding after World War II.
Its’ key function is to give economic aid to less developed countries.
The funds provided allow for the building of communications systems, transportation networks, and energy plants.
Has more than 180 members

12. World Bank (cont.) Has two main divisions
International Development Association (IDA): makes loans to help developing countries.
International Finance Corporation (IFC): provides capital and technical help to private businesses in nations with limited resources.
Promotes joint ventures