International Business:

• Defined as a transaction across international borders, where business is conducted between countries.

Purposes of International Business:

• Firms and governments conduct international business in order to:

· expand market share

· increase profits

· enhance cooperation between countries

Challenges In International Business:

Three major types of challenges that firms may encounter when entering international business:

• Physical challenges-natural resources, terrorism, climate, location and regional epidemics
• Social challenges-culture, legal/law, nationalization and different political systems
• Competitive challenges-firm’s strategy, price, cost-effectiveness, firm’s size, market size and competitors.

Salient Point:

• International business has created new trends for companies to expand their business markets overseas hence creates the development of international organizations
• However, international business is fraught with unexpected risks/challenges that can upset a company’s operation.