International-Business-Dr-R-Chandran-E-book

10. Legal aspects
11. Investment and
Sourcing
12. Pricing strategy
13. Distribution
channels
14. Promotion
15. Logistics
13
International Business- Dr. R. Chandran
behavior. pattern & warranties are parts of product
Only local regulations are fully
applicable to conduct business.
There is minimum adherence to
international regulations related to
IPR.
Depending on the size of the
business one can start with a
minimum investment. Involvement
of regulatory bodies is minimal.
Individual ability and repayment
terms determine the funds.
A majority of companies use cost
plus margin pricing or competitive
pricing.
The business house can use its
discretion to select any channel to
reach the customer. No restriction
exists here.
Advertising, personal selling and
other promotional methods are not
restricted through strict legal
framework if they are not socially
objectionable.
Domestic players are involved in all
the activities. The cost of logistics is
very high locally.
International regulations and host
country regulations are applicable.
Advanced countries impose strict
regulations compared to LDCs. Strict
adherence to contractual obligations is
common.
All overseas operations except exports,
call for huge investments to set up and
expand the business in many countries.
Special regulatory bodies are involved
in the process since foreign currency is
transacted.
Companies use marginal cost pricing or
transfer pricing or competitive pricing to
succeed.
Government or market practice governs
the distribution channel. Cash and carry,
shopping malls and mail order services
are becoming popular in international
business.
Different countries have different
restrictions. For example,
advertisements for liquor and cigarettes
are not permitted in some countries and
campaigns using female models are
banned in others.
International players with advanced
technology and systems are involved.
Proportionately, the cost is low for
physical movements.
Some business groups like Adanis started only overseas operations
without any linkage with domestic operation right from the beginning.
Tata group established a good name at home country and gradually
moved to other countries. For companies in IT, such as Wipro or
Infosys, the major focus is on overseas operations. All the companies
cited as examples above are successful in their own right, but the
strategies and operation systems differ from country to country.
Organizations like RELIANCE INDUSTRIES have inherent strength in
indigenous business such as completing the project prior to stipulated
time. This experience enables the company to grab any business
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