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1
Though global trade has existed for centuries,
today the business world is changing and
becoming more international as a result of
globalization.
2
To define business and international
business
To explain the historical origins of
international business
3
To identify the major factors that influence
trade
To explain levels of participation in
international trade
4
International trade affects most companies
and customers in the United States and
around the world.
5
business
any activity that seeks profit by
providing goods or services to
others
international any activity involving business
business
operations across national borders
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domestic
company
a company that conducts business
in only one country, which is
known as the home country
international a company that conducts business
company
across national borders
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the increasing integration of the
globalization
world economy
global
dependence
the concept that all countries
depend on each other for trade
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Understanding International
Business
Everyone is affected by international
business.
Understanding international trade will help
you prepare to work in business today.
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Business and International Business
Business can be
selling lemonade at a
homemade stand or a
corporation expanding
into international
markets.
business
any activity that seeks
profit by providing
goods or services to
others
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Business and International Business
Another term for
international
business is global
business.
international
business
any activity involving
business operations
across national
borders
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Business and International Business
Tangible
Goods
Business
Intangible
Services
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Domestic and International
Companies
A family-owned diner
in your neighborhood,
it is a domestic
company.
domestic company
a company that
conducts business in
only one country, which
is known as the home
country
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Domestic and International
Companies
An international
company contributes
to the trend of
globalization.
international company
a company that
conducts business
across national borders
globalization
the increasing
integration of the world
economy
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Domestic and International
Companies
Relate Can you name a
service that you or your
family could use anywhere
in the world?
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Home and Host Countries
A home country is the country in which the
selling firm is located.
If a representative travels to another
country to market or sell products,
that country is the host country.
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The History of Global Business
Trade took place between China, India,
and Japan as many as 15,000 years ago.
During the 11th century, England, France,
Spain, and Portugal all used ships to move
products between countries.
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The History of Global
Business
1800s: Multinational
companies such as Colt’s
Manufacturing Company
and Singer’s sewing
machine company begin
to appear.
1600-1776: Merchants in colonial America conduct
trade and export agricultural products and other
goods to Britain and European countries.
1600
1599: The British
East India Company
conducts trade
through Asia.
1700
1800
1776: British
investors try to
establish companies
in the newly
independent United
States
2000s: Americans
sell goods and
services to other
countries, and
Americans purchase
goods and services
from other countries.
1900
2000s
1920: More than 37 U.S.
companies operate production
facilities in two or more nations.
Every car bought in Japan is
made by a U.S. company.
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The History of Global Business
Question What were two
multinational companies in
the United States during
the 1800s?
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Global Trendsetters in Switzerland
Meeting and Greeting Shake hands firmly with people
you meet, and again upon leaving.
Business Etiquette Give your business card to
associates you meet. Be punctual.
Business Dress Men wear suits and ties, and women
wear suits or dresses.
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The Global Business Environment
Trade relations between companies and
countries are affected by three factors.
Cultural and
Social
Political and
Legal
Economic
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The Global Business Environment
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Cultural and Social Factors
Cultural and Social Factors
Changes in a country’s education system
Changes in a country’s economic philosophy
Religious influences
Proper business protocols
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Political and Legal Factors
Political and Legal Factors
Wars and international conflicts
Elections
New governments
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Economic Factors
Economic Factors
Recession
Inflation
Economic growth or decline
Exchange rates
Natural disasters
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International Business Management
Forms of business ownership and the legal
requirements for operating businesses vary
in different countries.
The things that motivate employees vary
around the world.
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Marketing and International Trade
The four Ps of marketing are vital elements
for successful marketing in international
business.
1
2
3
4
Product
Price
Place
Promotion
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Accounting and Finance
Effective businesspeople understand the
importance of financial issues for
international trade.
Accounting and finance are the major
elements of money management in
international trade.
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Human Resource Management and
Careers
The human resources department is
responsible for recruiting, hiring, and
training people.
Gain additional training and learn how to
do business across international borders.
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Trade Relations
The relationships and
ties between
companies around the
world have created
global dependence.
global dependence
the concept that all
countries depend on
each other for trade
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Trade Relations
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Trade Relations
Participants in
International Trade
Individual Consumers
States and Provinces
Companies
Countries
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Volcanic Trade Region The Pacific Rim
is also called the “ring of fire,” due to the
many volcanoes located along the edge
of the Pacific tectonic plate in the north
Pacific Ocean.
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1.1
1. What is international business?
International business is any activity involving
business operations across national borders.
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1.1
2. When did global trade first begin?
International trade began as much as 15,000 years ago.
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1.1
3. What are three factors that influence trade relations?
cultural and social; political and legal; and economic
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