International Business

Until recently, a small business generally meant a local business. Business owners purchased necessary materials from other establishments in the area, and the customer base was made up mostly of those who lived close enough to do business in person. The spread of the Internet has changed the way a small business can operate, and has created new opportunities for an international business career.

International Business Opportunity

As more businesses choose to globalize, you may be wondering if expanding your business internationally is right for you. Here are just a few possible reasons to globalize your business:
  • expansion beyond saturated domestic markets
  • diversified customer base
  • labor and materials at lower cost.
With the world as your resource, there is a huge potential for lower costs, more customers and greater profits.

Getting Started

Careers in international business require some research and study. As you expand into a world market, you will have new competitors around the globe. Understanding their operations will give you an edge. A study of your competitors should include their:
  • business strategies
  • customers
  • distribution and sales channel management
  • marketing channels
  • packaging
  • pricing
  • strengths and weaknesses.
You can begin your research from your own computer. The Internet is a wonderful resource for learning about other companies worldwide. If you need additional information about a competitor, you can find it through organizations such as BURGEL in Germany or Teikoku Databank in Japan. American financial institutions, including Dow Jones and Dun and Bradstreet, can also provide information about your international competitors. Be aware that if you use an outside company for your research, there is a fee for this service.
 
Your early studies should also include learning about all the countries in which you wish to do business. Be sure to gather information about each country's:
  • cultural traditions and etiquette
  • demographics
  • exchange rates
  • income levels
  • inflation rates
  • technological sophistication
  • trade regulations and tariffs.
Once your research is complete, you can begin to establish a worldwide presence by listing your business in international Web directories and yellow pages.

Financial Considerations

Expanding your business always requires capital, and a global expansion can sometimes be challenging. Here are a few resources to help you find the capital you need:
  • Export-Import Bank of the United States (Eximbank)
  • Overseas Private Investment Corporation (OPIC)
  • Private Export Funding Corporation (PEFCO)
  • U.S. Small Business Administration Export Loan Guarantee Program.
You can also check with your local bank. Many banks are now equipped to handle international business transactions. If not, your bank may have a working relationship with other banks that are equipped to handle international business.

International Business Associates

International business expansion entails working with people and organizations around the world. In addition to any direct sales you achieve online, you will need to find agents, importers, retail stores or value-added resellers (VAR's) to sell your product in other countries. Unless you are an expert in foreign languages, you may also need to find a business associate to assist with multi-lingual packaging.
 
Many small business owners find that forming a joint venture with someone in a target country can be very helpful. Having a partner with an inside understanding of the people and business practices of another country can be a huge advantage. If your partner is a VAR who plans to make his own changes and improvements to your product, this can also create some risk.
 
When choosing your international business associates, it is important to research their business practices and backgrounds to insure their qualifications and honesty. It also helps to take the time to get to know a potential associate to see if his or her personality and business style is a good fit with your own. For the protection of everyone involved, it makes sense to draw up detailed international business contracts before beginning official business relationships.