BUSINESS MANAGEMENT

Strategic International Business Management



Strategic International Business Management

Introduction

International Business Management is a critical process of managing business across the borders. Each region is unique in terms of market characteristics, environmental factors, and potential opportunities. International business management involves practical realisation of external and internal environmental pressures. In this regard, firms design international business strategies, mitigating the pressure effect with efficient strategic management. In business world, strategic management refers to adopting measures for meeting business goals. Today, business world has become too competitive. Business techniques have evolved over time, offering strategic planning for managing every aspect of business. For that matter, theoretical practices provide more practical & realistic ways for business expansion. It is essential to understand the factors which influence the success of an international business. These factors can be internal or external to a firm. Market demographics, consumers patterns, trade regulations, and economy are some the factors that have sound effect on success of a business.

The write up explores the implications of international business management. For that matter, Carrefour's future expansion strategy has been discussed. The report begins with a brief overview of the company for establishing context for discussion. The market identification process takes into account the location determinants. Further, the analysis of macro-environmental factors is presented in order to frame recommendations.

Discussion

Carrefour: Company's Overview

Carrefour is the second largest retailer, operating in 33 countries. The company has over 9900 stores across the globe. The company is based in France, but it has expanded its operations in Europe, UAE, Saudi Arab, China, Brazil, and some parts in Asia & Latin America. According to Fortune's report, Carrefour generated revenue of $120, 296.8 millions in 2011. The report projected that the group managed to generate the net profit of 573.5 million dollars. The company enjoys a large workforce of 412,000 employees. The group does business through four kinds of business unit; Hypermarkets, Supermarkets, Convenience Stores, and Cash & Carry Stores. Basically, Carrefour is a multi format, and multi-channel business group. Identification of a market location requires analysis & comparison of specific factors. This report analyses the Macro factors for location determination.

Location Determinants

Regulatory & Economic Factors

Industrial Policies: Industrial policies control new entrants, profit margins, competition level, and social benefits etc. In selecting a location, one has to ensure that the target region permits foreign business entries on favourable terms. Moreover, it is essential to scrutinise that the country's industrial policies are favourable for the business. Some countries have strict regulations which serve as an obstacle for foreign business entry.

FDI Policies (Foreign Direct Investment)/ Special Economic Zones: For a Multi National Enterprise, it is important to identify the entry modes options. For instance, some countries allow Tax free zones, Free Trade Zones, and Special Economic Zones to encourage foreign business. In some cases, host countries allow foreign business in specific geographical locations. The host countries do it in order to boost specific regional economies. It is equally important to identify if any geographical restrictions are imposed by the ...