factors affecting gbe
TRANSCRIPT
8/7/2019 Factors affecting GBE
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GLOBAL BUSINESS
ENVIRONMENT
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F ACTORS AFFECTING INTERNATIONAL BUSINESS
SOCIAL/CULTURAL POLITICAL
IB
ECONOMIC LEGAL TECHNOLOGICAL
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POLITICAL F ACTORS
Different parties have different policies.
Characteristics and policies of the political
parties in power.
Nature of the Constitution and
government.
Formation of economic and businesspolicies
Regulation
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F ACTORS INFLUENCIG POLITICAL
ENVIRONMENT COMPOSITION OF POPULATION
Religion, Tribal, Rural and Urban
Share of these class in economic and political power
Emigrants
PARTY IN POWER
Key leaders and their background
Policies and manifesto
Internal security of the parties
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REGIONAL TIES
Border disputes
External and Internal threats
GOVERMNMENT AND INSTITUTIONS
Constitutional principles
Institutional setup to govern
The power of press
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ECONOMIC F ACTORS Level of development Economic resources
Size of the economy
Economic system
Policies Trends in GNP growth rate
Per capita income
Trend and nature of foreign trade
Domestic demand and supply
Support of govt. to export
Barriers to international trade
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Level of development ± if it is high the infrastructure willbe good and the economy grows, surplus production willbe there and the country will be having relations with theoutside countries.
Economic resources ± if there is ample economicresources we can do business anywhere.
Size of the economy ± to attract more investments thereshould be liberalized rules and regulations for further
development. Economic system ± capitalism, socialism etc. prevailing in
the domestic territory.
Policies ± economic policies and govt. policies affect thegrowth of the economy. Opportunities are much higher
where better policies are provided. Domestic demand and supply ± if demand in domestic
market is high the international trade will be less and viceversa.
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LEGAL F ACTORS
Different legal systems prevailing in
different countries ± an international court
will be there to settle the disputes between
two countries. What to do to settle dispute
will be clearly stated in the international
contract.
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MAJOR DISP ARITIES IN NATIONAL LAW AFFECTING IB
In relation with
Intellectual property rights
Consumer protection product liability
Competition among business
Bribes and corruption practices
Advertisement and sales promotion
Contracts
Marketing practices
Carriage of goods
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INTERNATIONAL LAW
It applies to sovereign states and imposes
rights and duties on nations in their
dealings with each other.
It derives from consensus on rules agreed
by contesting countries from internationally
recognized legal principles.
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MAJOR INDIAN LAW PERTAINING TO IB
EXPORT IMPORT ACT FEMA
THE EXPORT (QUALITY CONTROL AND
INSPECTION)
TRIPS (Trade Related Intellectual Properties
Acts)
TRIMS (Trade Related Intellectual Measures)
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SOCIO ± CULTURAL
F ACTORS
The way we do things or a configuration of learned behaviour - culture
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F ACTORS INFLUENCING
CULTURE Education
Society
Political structure
Man and the Universe ± human andnature is having their own duties which isdefined by culture
Belief and the style of living
Music, drama and dance
Language
Religion ± The value
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TECHNOLOGICAL F ACTORS
Technical know-how
Internet
Communication
Availability of technical brains ± qualifiedpeople or trained people for using latesttechnologies.
Networks
Access ± the technology should beaccessible.
Adaptability ± the technology should be
adaptable in the countries where it is used.
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TYPES OF IB
Licensing and franchising ± working like anagent e.g. ICICI units functioning all over the world.
Exporting
Contract manufacturing or sub contracting
Management contracting ± highly qualified
people will be giving solutions to problemsall over the world.
Fully owned manufacturing ± setting up our own manufacturing units outside the state.
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Assembly operations ± assembling the raw
materials from outside and manufacturing the
product. Joint venture
Third country location ± Xerox from US entered
into joint venture with MODI from India and
exported MODI-XEROX to Russia where India
had a good relation.
Merger and acquisition
Strategic alliance ± for solving a commonproblem two parties will come together and take
common solutions and further there will not be
any relation.
Counter trade ± similar to barter system