International Business
International Business
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| International Business |
a. International Trade
In terms of international trade transactions between the State it
is usually done in the traditional way is by way of exports and imports. With
the export and import transactions that will arise "Inter-State Trade Balance"
or "Balance of Trade". A State may have a trade surplus or deficit
Its trade balance. The trade balance showed a surplus of circumstances in which
the State has a greater export value compared to the value of imports from the
country conducted its trading partners. With the trade balance surplus is then
another when the circumstances are constant, the cash inflows to the country it
would be bigger with the release of the cash flow to the trading partner
countries. The size of the cash flow in and out across the country is often
referred to as the "balance of payments" or "Balance of
Payments". In this case the balance of payments surplus is often also said
that the country is experiencing Added Foreign Countries. Conversely, if the
state was experiencing balance of trade deficit, the mean value of imports
exceeds the value of exports that can be done with other State. Thus, the
country will experience a balance of payments deficit and will face a reduction
of the State Foreign Exchange.
b. International Marketing
International marketing is often referred to as International
Business (International Busines) is a state in which a company may engage in
business transactions with other countries, other companies or the general
public abroad. International business transactions is generally an attempt to
market their production overseas. In such a case the employer would be free of
trade barriers and tariffs because there is no import export transactions. With
the inclusion of direct and carry out production and marketing activities in a
foreign country does not happen then the export and import activities. The
products are marketed not only in the form of goods but can
also in the form of
services. International business transactions of this sort can be done in
various ways, among others:
- Licencing
- Franchising
- Management
Contracting
- Marketing in Home
Country by Host Country
- Joint Venturing
- Multinational Coporation
(MNC)
All of the above forms of
international transactions will require payment transactions are often referred
to as Fee. In the case of the State or the Home Country must pay while the
sender or the Host Country will receive the payment.
Definition of
international trade with international companies often confused or often
considered the same, but as we saw in the description above was indeed
different. The main difference lies in the treatment where internasinol trade
conducted by the State while the international marketing is an activity
undertaken by the company. Besides determining international marketing business
activity more active and more progressive than in international trade.
Reasons for Implementing International
Business
Some of the reasons for
carrying out international business such as:
1. Specialization among
nations
In connection with certain
powers and their advantages or disadvantages that a State should determine the
strategic choice to produce a strategic commodity, namely:
a. Utilizing maximum force
was actually the most superior so it can produce more efficient and the
cheapest among other countries.
b. Focus on commodities
that have the smallest weakness among other countries
c. Concentrating his
attention to producing or controlling commodity that has a weakness for the
country's highest.
• Excellence absolute (absolute
advantage)
A country can be said to have an absolute advantage if the
country holds a monopoly in the production and trade of these products. This
will be achieved if there is no other country that can produce these products
so that the state becomes the only producer that is generally caused due to its
natural conditions, such as mining, agriculture, forestry, agriculture and so
on. In addition to natural conditions, the absolute advantage can also be
obtained from a country that is able to produce a commodity the cheapest among
the countries other.
The advantages of this kind will generally not be able to last long because of
technological advances will quickly overcome way more efficient production and
lower costs.
• Comparative advantages
(comparative advantage)
The concept of comparative advantage is a concept that is more
realistic and widely available in International business. That is a situation
in which a country has a higher ability to offer these products compared to other
countries. Higher ability in offering a product that can be realized in various
forms, namely:
a. Costs or a lower bid
price.
b. Superior quality though more expensive.
c. Continuity of supply (Supply) better.
d. Business relations and political stability are good.
e. The availability of support facilities such as better training facilities and transportation.
b. Superior quality though more expensive.
c. Continuity of supply (Supply) better.
d. Business relations and political stability are good.
e. The availability of support facilities such as better training facilities and transportation.
A state will generally concentrate to produce and export
commodities which he has a comparative advantage and then import the best
commodities where they have comparative advantage ugliest or greatest weakness.
The concept will be able to take a look at the clear and evident when we try to
examine the trade balance of our country (Indonesia), for example. Of the trade
balance that we can see what we export commodity is a commodity that has a
comparative advantage for Indonesia and we import our comparative advantage is
the weakest.
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