A manager at IBM once told me to think of relationships as bank accounts. You must deposit into them before you can make a withdrawal. This holds true not only in business but also in any relationship. Strong relationships are very important in business. This is especially true in international business, where there needs to be so much trust and dependability because big things are happening across large distances.
Although the foundations upon which relationships are built are similar for domestic and international markets, building relationships internationally comes with its own challenges. Domestically, I can usually drive my car and go for a face-to-face meeting. I don’t really have this luxury when working internationally.
Your actions will need to speak louder than your words.
1. Focus on building credibility with your global business partners You’re credible if you’re honest, transparent and tell it like it is. This quality will naturally make its way to the products you represent. I once had an issue with a cheap imitation of one of the brands I represent. The deal was almost sealed with the distributor, but we were hit with the news that a knock-off product from China that claimed to do what our product does was already on market shelves for a fraction of our price. This news negatively affected our distributor’s willingness to continue negotiations with us, and the deal never materialized.
Our intention was never to hide any information; we just didn’t know. This also speaks to the importance of proper research on the foreign market in which you’re interested.
As a corrective action, and to maintain our credibility, we modified all our proposals to include the names of such knock-offs. We also now offer guidance on the differentiating factors and the benefits of representing only original products.
2. Set the right expectations so you can always follow through Nobody likes it when expectations aren’t met.
I had a situation once with the display boxes that we ship with our products. They’re white in color. Why? Because they’re targeted for the international market, which comes with different languages and tastes. A blank canvas enabled the distributors to add their own name, logo, and the language most suited for their local market.
However, at the time our website featured a display box that wasn’t white. It was one of the display boxes used as a sample, and it was printed with graphics and names. The distributor assumed that the box listed on the website is what they’d receive, but to their surprise when they received it, it wasn’t.
We fixed the situation by sending them high-quality posters to use, and future shipments were no longer an issue. However, this led us to do a complete review of all our materials to ensure we always set proper expectations and follow through with them.
Our proposals now include the white display boxes, and we clearly state the added benefit of using that color.
3. Listen to your global customers and adapt your offerings accordingly
Everyone and every business has their motivations for being in relationships
This is a simple sales concept, but you have to be able to answer their question, “What’s in it for me?”
For us at Canada Topp, listening and adapting our offerings resulted in redesigned packages with different colors and languages. We modified images, instructions, and leaflet sizes. Many customers were also not reading the instructions, so we created fun videos which were easier to follow.
We put all instructions on websites in different languages so they can be read online easily via computer or smartphone. Don’t make the mistake of expecting that what’s working for you at home can be forced onto a foreign market. Listen and adapt.
Listen to your partners’ preferred communication style too. If you’re not getting prompt replies to your emails, they may prefer talking over the phone. I usually like to ask what works for them. One of the distributors I work with prefers text chatting over Skype. It works for him, and I managed to adapt to his style. As a result, we have a more successful relationship.
In today’s global economy, companies of all sizes are establishing operations in foreign markets. This type of expansion can provide several advantages, including greater opportunities for market growth and diversification. The trend of Americans going global is also likely to continue. A 2016 survey by Wells Fargo found that 87 percent of U.S. firms believe that international expansion is necessary for long-term growth.
However, despite the growing number of U.S. companies expanding abroad, there are still many firms that haven’t made the leap overseas. If you’re on the fence about taking your company global, consider these five benefits of international business expansion.
1. New markets
According to the U.S. Small Business Administration, 96 percent of the world’s consumers live outside of America. For many companies, the international expansion offers a chance to conquer new territories and reach more of these consumers, thus increasing sales.
For example, U.S. firms like Nike and IBM maintain operations in the Netherlands because it offers direct access to 170 million European consumers within approximately 300 miles. In fact, Holland’s connection to European markets is one reason why UPS recently opened a new $150 million facility in Eindhoven, one of the company’s largest investments in Europe.
2. Diversification
Many businesses expand internationally to diversify their assets, an action that can protect a company’s bottom line against unforeseen events. For instance, companies with international operations can offset negative growth in one market by operating successfully in another. Companies also can utilize international markets to introduce unique products and services, which can help maintain a positive revenue stream.
Coca-Cola is an example of a company that diversifies through global operations. This quarter, the company reported increased sales in China, India, and South Korea, which benefited Coca-Cola worldwide. Coca-Cola also recently bought Mexican sparkling water brand Topo Chico in an effort to grow a more globally attractive and diverse portfolio.
3. Access to talent
Another top benefit of going global is the opportunity to access new talent pools. In many cases, international labor can offer companies unique advantages in terms of increased productivity, advanced language skills, diverse educational backgrounds, and more.
For example, when Netflix expanded to Amsterdam earlier this year, the company praised the city for enabling Netflix to hire multilingual and internationally-minded employees who can expertly “understand consumers and cultures in all of the territories across Europe.”
In addition, international talent may also improve innovation output within a company. For instance, that’s one reason why foreign markets that welcome global entrepreneurs and skilled workers often have denser and more successful start-up climates.
4. Competitive advantage
Companies also choose international expansion to gain a competitive edge over their opponents. For example, businesses that expand in markets where their competitors do not operate often have a first-mover advantage, which allows for them to build strong brand awareness with consumers before their competitors. International expansion can also help companies acquire access to new technologies and industry ecosystems, which may significantly improve their operations.
International business can also increase a company’s perceived image, as global operations can help build name brand recognition to support future business scenarios, such as contract negotiations, new marketing campaigns, or even additional expansion.
5. Foreign investment opportunities
Finally, companies considering international expansion shouldn’t forget about the additional investment opportunities that foreign markets can offer. For instance, many firms are able to develop new resources and forge important connections by operating in global markets.
Companies with multinational operations can also benefit from lucrative investment opportunities that may not exist in their home country. For example, many governments around the world offer incentives for companies looking to invest in their region. Thus, U.S. firms should always do their research before making an international expansion decision.
As a Fine Cooking editor, I’ve had the chance to observe lots of great cooks at work. From them, I’ve learned plenty—including the fact that good-quality pots and pans made of the right materials really can improve your cooking.
Rather than having a rack filled with pots and pans of all shapes and sizes, owning a few well-chosen pieces will give you the flexibility to cook whatever you want and the performance you need to cook it better.
I polled some of our authors to find out which pans were the most valuable to them and why. I then came up with six pieces, starting with two indispensables: an anodized-aluminum stockpot to handle stocks, soups, stews, some sauces, blanching, boiling, and steaming; and a high-sided stainless-steel/aluminum sauté pan with a lid for frying, deglazing sauces, braising small items like vegetables, making sautés and fricassées, cooking rice pilafs and risottos, and a whole lot more. The other four pieces I picked make for even more cooking agility and add up to half a dozen ready-for-action pots and pans that you’ll really use (see For every pot, there’s a purpose…).
For every pot, there is a purpose…
The letters identifying the pots key to the photo below.
A. Calphalon 8-quart (or bigger) stockpot, with lid. Simmer soup or cook a big batch of tomato sauce in this sturdy, nonreactive stockpot. It will do double-duty for boiling pasta and steaming vegetables, too. (www.calphalon.com)
B. All-Clad 3-quart sauté pan, with lid. Stainless coating with aluminum sandwiched all the way through makes for a responsive, durable, attractive pan. Great for frying, deglazing, and, of course, sautés. And it goes from stove to oven. (www.allclad.com)
C. Mauviel Cuprinox 3-quart stainless-lined copper saucepan, with lid. Top-performing copper is heavy-duty and responsive, with a shiny stainless interior that’s easy to see and durable. Copper tarnishes easily, but when it’s cared for, it looks great.(www.frenchcopper.com)
D. Lodge cast-iron skillet. Old faithful needs thorough drying and constant seasoning, but nothing takes high heat better, holds it as long, or puts a better crust on cornbread. It’s durable — and cheap, too. (www.lodgemfg.com)
E. Le Creuset oval enameled cast-iron casserole, with lid. Great for stove-to-oven roasts and stews and long, slow simmering. Its light-colored interior makes it easy to see into for deglazing sauces. (www.lecreuset.com)
F. Circulon Commercial nonstick skillet. This heavy-weight nonstick stands up to high heat and wear, goes from stove to oven, has an easy-gripping handle, and cooks delicate omelets as well as Cajun pork chops. (www.circulon.com)
All good pans share common traits
In a well-stocked kitchen store, you’ll see lots of first-rate pots and pans. They may look different, but they all share essential qualities you should look for.
Look for heavy-gauge materials. Thinner-gauge materials spread and hold heat unevenly, and their bottoms are more likely to dent and warp. This means that food can scorch. Absolutely flat bottoms are particularly important if your stovetop element is electric. Heavy-gauge pans deliver heat more evenly (see “Good pans are worth their price…,” below).
To decide if a pan is heavy enough, lift it, look at the thickness of the walls and base, and rap it with your knuckles—do you hear a light ping or a dull thud? A thud is good in this case.
Good pans are worth their price because they manage heat better
“Good conductor” and “heavy gauge” are the key features of good cookware. Here’s how these characteristics affect cooking.
You get responsive to heat. Good heat conductors, such as copper and aluminum, are responsive to temperature changes. They’ll do what the heat source tells them to do—heat up, cool down—almost instantly.
You get fast heat flow. Heat flows more easily through a good heat conductor, assuring a quick equalizing of temperature on the cooking surface.
You get even heat diffusion. A thicker pan has more distance between the cooking surface and the heat source. By the time the heat flows to the cooking surface, it will have spread out evenly, because heat diffuses as it flows.
You get more heat. Mass holds heat (heat is vibrating mass, so the more mass there is to vibrate, the more heat there will be). The more pan there is to heat, the more heat the pan can hold, so there’s more constant heat for better browning, faster reducing, and hotter frying.
You’ll want handles and a lid that is sturdy, heatproof, and secure. Handles come welded, riveted, or screwed. Some cooks advise against welded handles because they can break off. But Gayle Novacek, cookware buyer for Sur La Table, has seen a few such cases. As long as handles are welded in several spots, they can be preferable to riveted ones because the residue is apt to collect around a rivet.
Many pans have metal handles that stay relatively cool when the pan is on the stove because the handle is made of a metal that’s a poor heat conductor and retainer, such as stainless steel. Plastic and wooden handles stay cool, too, but they’re not ovenproof. Heat- or ovenproof handles mean that dishes started on the stovetop can be finished in the oven.
All lids should fit tightly to keep in moisture. The lid, too, should have a heatproof handle. Glass lids, which you’ll find on certain brands, are usually oven safe only up to 350°F.
A pan should feel comfortable. “When you’re at the store, pantomime the way you’d use a pot or pan to find out if it’s right for you,” advises Fine Cooking contributing editor and chef Molly Stevens. If you find a pan you love but you aren’t completely comfortable with the handle, you can buy a rubber gripper to slip over the handle. Just remember that grippers aren’t ovenproof.
Some pans need special talents
Depending on what you’ll be cooking in the pan, you may also need to look for other attributes.
For sautéing and other cooking that calls for quick temperature changes, a pan should be responsive. This means that the pan is doing what the heat source tells it to, and pronto. For example, if you sauté garlic just until fragrant and then turn down the flame, the pan should cool down quickly so the garlic doesn’t burn. Responsiveness isn’t as crucial for boiling, steaming, or the long, slow cooking that stocks and stews undergo.
For sautéing and oven roasts, it helps if the pan heats evenly up the sides. When you’ve got a pan full of chicken breasts nestling against the pan sides, you want them all to cook quickly and evenly, so heat coming from the sides of the pan is important. Even heating up the sides of a pot is important for pot roasting, too. Paul Bertolli, Fine Cooking contributing editor and chef of Oliveto restaurant in Oakland, California, counts on his enameled cast-iron oval casserole by Le Creuset for braising meat because “it’s a snug, closed cooking chamber with even heat radiating off the sides for really good browning.” Bertolli finds that meat fits especially well into the oval shape.
For cooking acidic foods, such as tomato sauces, wine sauces, and fruit fillings, a pan’s lining should be nonreactive. Stainless steel, enamel, and anodized aluminum won’t react no matter what they touch, while plain aluminum can discolor white sauces and foods that are acidic, sulfurous, or alkaline. It can even make those foods taste metallic. Eggs, vegetables in the cabbage family, and baking soda are some of the other foods vulnerable to aluminum’s graying effect. In the past, there was concern about aluminum and Alzheimer’s, but evidence has been far from conclusive.
Interview yourself to help you choose the right pans
There’s nothing wrong with matching cookware in principle. Packaged starter sets are attractively priced, and a whole lineup of matching pants can be attractive, too. But a single material isn’t suited for every kitchen task—with sets, you’re often stuck with pans you don’t need. That enameled cast-iron casserole is just right for the cassoulet you’ll move from stovetop to oven. But its matching saucepan overcooked your last caramel because the pan was too heavy to heft quickly once the sugar turned color.
You’ll get more use out of pieces that you hand-pick yourself. You may already own a matched set (the red Le Creuset ensemble I got years ago as a housewarming present is still hanging in my kitchen), but as you add new pieces to your collection, you’ll have a chance to branch out to different materials (see “Materials that make the pot”).
To decide what you need, ask yourself questions like the ones that follow.
Materials that make the pot
The letters identifying the materials key to the photo below.
A. Stainless steel is a poor conductor of heat all by itself, but it’s a peerless surface metal: easy to clean, durable, shiny for good visibility, and completely non-reactive.
B. Copper is a superb heat conductor and radiates visual warmth, too, if you keep it polished. All alone, copper is highly reactive with food, so the pans must be lined. It’s often used as a bottom layer for better heat conduction.
C. Aluminum is a top-notch heat conductor and is lightweight and easy to handle, but it reacts with acidic, sulfurous, and alkaline foods. Aluminum is often used as a core or bottom layer for better heat conduction.
D. Cast iron is an excellent retainer of heat and great for high temperatures. It’s relatively slow to heat up and cool down and needs thorough drying and oiling.
E. Nonstick coatings have greatly improved to withstand high heat and abrasion.
F. Anodized aluminum is aluminum that’s been electrochemically sealed, making for a nonreactive, hard surface. The dark interior, though, makes it difficult to see the color change in pan juices and translucent sauces.
G. Enameled cast iron’s coating solves the maintenance problems of cast iron, but the heating benefits remain. The enamel coating can chip with wear and abrasion.
Are you more likely to make saucy dishes like fricassées and sautés than delicate foods like omelets and crêpes? A bigger sauté or frying pan with high sides and a lid may be a better choice than a shallower, slope-sided omelet pan without one. “At home, I make a lot of dishes where the pasta gets thrown in with the other ingredients for the last few minutes, and my anodized-aluminum sauté pan is the one I always grab,” says Molly Stevens of her favorite Calphalon pan. “It’s responsive, I know the food won’t scorch, and I love the handle.” She adds that its anodized surface is easy to clean.
Do you cook lots of soup on weekends to freeze for meals during the week? A heavy stockpot may be essential. “I always choose heavy-gauge for anything that stays on the stove a long time,” says Larry Forgione, chef/owner of the New York City restaurant An American Place, who says food burns and sticks whenever he uses a thin stockpot. Abby Dodge, Fine Cooking’s recipe tester, agrees. “With soups and stocks, a heavy bottom comes first,” she insists. “And if your budget allows it, go for the best.”
Do you make pasta several times a week? Don’t toss that big, thinner-gauge pasta pot if you already have one; it’s fine for boiling and steaming — and lighter is better when you’re carting a boiling pot from the stove to sink. But if you don’t have a big pot yet, think about doubling up your pasta-boiling with stock- and soup-making by using a heavy stockpot.
Do you like making sauces? “When I’m browning or deglazing, I need to see what the pan juices are doing,” says Jim Peterson, Fine Cooking contributing editor, and chef. For such jobs, he avoids pans with a darker interior, such as anodized aluminum, and prefers a shiny stainless-steel lining.
Nancy Silverton, baker, pastry chef, and co-owner of La Brea Bakery and Campanile in Los Angeles, agrees. “I love the steady heat and surface of seasoned cast iron, but seeing the color change is crucial, so I need a pan that’s bright inside, like stainless,” she says. Silverton cautions that tin- and aluminum-lined pans affect the taste of acidic foods, such as compotes and fruit fillings. Both Peterson and Silverton love the visual warmth of copper but agree that top-notch stainless with an aluminum core, like All-Clad, works just as well.
Do you often serve stews, pot roasts, or braised meat dishes? Paul Bertolli loves the way Le Creuset enameled cast iron handles such dishes. “I can start dishes on the stove, transfer them to the oven, and all the juices will be ready to deglaze in the same pot.” He adds that one-pot cooking makes for swift cleanup, too. And Scott Peacock, a southern chef, loves enameled cast iron because “you can put on a lid, set the pot at the back of the stove, and it will hold the food at a good serving temperature a long while.”
Do you like cooking chops, steaks, or thick fish fillets? Cast iron may be heavy, but chef and writer Regina Schrambling says that “for searing fish at intense heat and finishing it in the oven, I trust it.” Scott Peacock likes it, too, especially for making golden-crusted cornbread, but cautions that unless cast iron is well seasoned, it can make acidic foods taste metallic, and that metal utensil themselves are apt to scrape off the seasoning.
Are you trying to cook with less fat? Nonstick may be a good choice, and happily, nonstick technology has come a long way in the past few years. With the old-style, lighter-weight nonstick pans, it was hard to get the pan hot enough to sauté properly. Nonstick pans are now being made of harder, high-heat-tolerant metals, such as anodized aluminum and stainless steel, and the coatings themselves can withstand more heat and abrasion — no more nonstick flakes in your food. Another potential disadvantage of sautéing in nonstick is the difficulty in deglazing. The nonstick surface can be so effective that you never get any good brown bits in the bottom of the pan. With Circulon, which has a finely ridged nonstick interior, browning takes place more like in a conventional pan, and Circulon’s Commercial line is super heavy duty.
Circulon pans have a ridged nonstick surface. The food won’t stick, but the juices will, so deglazing the pan is possible.
While living and working in China for more than four years, I had my fair share of cultural disconnects. Like when a man invited me out for dinner with all his friends a number of times and I learned—weeks and one very awkward situation later—that we were, in fact, dating. Or when my host family invited me over for dinners and I brought them gifts, they got very close to offended because they felt that true friends and family wouldn’t be so formal as to bring gifts.
Navigating the waters of cross-cultural communication are choppy, confusing and either really funny or really offensive. But when you’re doing so in the context of a business, you really want to avoid being the unknowing offender.
So if you have any clients, contacts or contractors outside of your home market, how do you maintain a positive relationship with them? It’s not a one-size-fits-all answer, but here are some considerations to get you started.
Educate yourself
The most important thing to note is that cross-cultural communication is far more than knowing what the local holidays are and adjusting your spelling for location (though those things are important). What it really comes down to is being willed to listen and learn. People are generally forgiving and tolerant, but if they think you’re not even trying to learn about them and their context, they’ll be understandably less so.
So approach all international communications from a place of understanding and respect. Diplomacy is an art, and you have to be willing to put yourself out there and learn from your mistakes.
Speak to people differently
Even if your customers speak English natively, you’re going to have to speak (or write) to them differently if you want to really connect with them. This may involve adding or deleting letters (like “colour” instead of “color”) but more importantly, you’ll need to watch your slang and colloquialisms.
In your email, phone and in-person conversations, you’ll want to cut out idiomatic expressions, because their meaning could be totally lost on your counterpart, or you could be inadvertently using a word that actually means something else (or worse, something offensive) in their country.
Talk to people differently
You’ll need to moderate not just your words, but also your tone of voice. Especially if you’re naturally more boisterous or very reserved, you’ll need to find a happy medium, since many people may perceive overt emotion as intimidating or gauche, or extreme reserve as cold and removed.
Find a tone that’s in your natural range and ever so slightly cheerful and stay within that range for the entirety of your conversation.
Understand their time
Time zones: Live them, love them, post them on your wall, set different clocks on your phone, and then make sure that any applicable webinars, support or communication channels are available to overseas clients during their daytime hours.
As someone who routinely dealt with 15-hour time differences, I understand the frustrations of trying to call U.S.-based customer service from China at midnight or later. Your customers or clients will not appreciate having to do the same thing, so while it might not be easy for your small business, you have to give your international clients some way to have a conversation with you during your customers’ normal waking hours.
You’ll also want to be well versed on local holidays, but not so you can send out holiday messages and offers. In fact, you should be very, very careful in regard to holidays; our international team recommends that you avoid them altogether if you don’t understand all the nuances that come with the holiday (and its resulting message) or if you don’t practice it yourself. Not understanding nuances or context around certain holidays can lead to huge gaffes which are hard to recover from.
You do want to know about local holidays so you can know if you’ll be facing delays. For example, take Chinese New Year. If you have any clients or contractors in China, you’ll probably know that the whole country has essentially shut down for the next five or six days, so the chances that you’ll be able to reach anyone there for any reason are all but nonexistent.
Understand their seasons
Consider this your friendly reminder that Christmas does not fall during the winter for many people—the whole Southern hemisphere, to be exact. Infusionsoft by Keap learned this lesson the hard way.
We once held a promotion called Own Your Summer, which fell during summer in North America, but we promoted it to all our customers—which included our substantial base in Australia. The promotion didn’t resonate for them, and for good reason: It showed them that we overlooked basic science and forgot that it wasn’t summer for them. And makes it seem like we hadn’t considered them as we should have, which, to be fair, we didn’t. You can bet we won’t be making that mistake again.
Tailor their emails
If you use Infusionsoft by Keap, you can schedule emails for each contact’s time zone instead of sending everyone the same email when it’s 8 a.m. for you, but not necessarily for them.
That way, you don’t have to worry about creating multiple international versions of your communications or about sending the wrong communications to the wrong people.
Give gifts they can use
If you’re promoting a giveaway or prizes or meeting them in person and exchanging gifts, you need to consider what they can use. Let’s say you’re based in the U.S. and giving away a TV and a person in the U.K. wins it. Well, plugs look different on either side of the pond, and voltages vary, so if you send over an American TV, all it will be for them is a large flat dust collector.
Food is a popular gift, but you’ll also want to be super cognizant of customs and border control. Bottles of alcohol are often subject to limits and taxes, and most fresh foods like fruits, vegetables, cheese and more are often banned completely, whether you’re sending the food via postal service or taking it on a plane with you.
Tailor what they see
If you have products for sale online but certain products that aren’t available globally, make sure that people entering your site no matter where they are only see the products they can actually buy and receive. There’s nothing more frustrating than finding what you want or need and seeing that it’s not available in your country, and you don’t want that frustration associated with your brand.
It’s also a good idea to test any images you want to use on your site with a small group of your target audience. Because images can have such varying connotations in difficult cultures, you want to know how they’ll resonate with your target audience before you put them out there.
Don’t pretend you know everything to save face—do what you can to learn everything you can and then test it with your target. And again, the most important part of successfully navigating international relationships is to always come from a place of respect and acceptance. The rest will follow as you learn.
If you’re looking to enter the international business, keep in mind that the majority of global roles prefer or require an advanced degree. According to a 2017 report from Burning Glass Labor Insight, 57 percent of employers prefer or require a graduate degree for positions within international relations.
A graduate degree, therefore, may be the best path to advance your career, whether you’re looking to earn a promotion, boost your income, enhance your professional network, or change careers. If you’re considering a career in international business, here are seven popular roles an advanced global studies or international business degree can provide.
Management analysts, also known as consultants, create new ways of improving an organization’s efficiency. They advise upper management on how to enhance company performance by solving organizational problems, such as evaluating a new market expansion program or adapting to a different operations strategy.
In particular, global analysts help companies find solutions to issues regarding foreign markets. They work with companies on specific projects within a wide range of areas on a global scale, including management, market research, corporate strategy, finance, and information technology.
An international analyst’s responsibilities may also involve:
Gathering and analyzing company data, such as revenue, expenditure, and employment reports, across international divisions
Determining how to lower company overhead, such as supply expenses, financial expenditures, and global staffing
Interviewing management overseas to determine the best methods and resources needed to resolve company issues on an international scale
Recommending new systems, practices, and organizational changes to be implemented within each global office
Working with managers to ensure that changes are being implemented effectively
Analysts work in both the public and private sector, including the government, nonprofits, small and medium-sized businesses, and large corporations. They may be freelancers or employed by consulting agencies. The largest international consultancies, such as Deloitte and PricewaterhouseCoopers, boast hundreds of thousands of employees.
“Consultants have to look at problems from a wide range of perspectives,” Marcus says. “They access issues objectively and distill facts by being able to analyze problems and trying to understand the root cause. They also need to have strong interpersonal skills, as consulting is as much about the analytical work as it is about building relationships.”
Marketing managers must balance a competitive business strategy with a creative vision. They often work with art directors, sales executives, product developers, public relations managers, and other employees to create engaging marketing campaigns.
In addition, international marketing managers are responsible for increasing global sales. They must be aware of global market trends and develop products that meet demand worldwide.
Global marketing managers’ duties also include:
Overseeing budgets, contracts, marketing plans, and advertising media with management and team members across international markets
Planning marketing campaigns to reach target markets, including specific age, gender, income, and education demographics, based on global needs
Initiating market research and analyzing findings to determine customer opportunities
Examining the international demand for company products and services while studying what their competition offers
Developing pricing strategies for a company’s products or services
Ensuring consistent brand tone and messaging across all platforms
Leading content generation and production across digital and print media
3. Executive
2017 Median Pay:$104,700 Estimated Job Growth through 2026: 8 percent
Executives plan organizational strategies that align with their company’s mission while managing employees and resources, with global executives overseeing company goals, policies, and procedures across international divisions. Their responsibilities may include:
Directing operational activities to create in-demand global products and services
Discussing company performance with other executives, staff, and board members worldwide
Negotiating and signing off on contractual agreements
Assigning department heads and managers overseas
Analyzing company reports, including financial and sales data
Identifying areas to reduce costs, increase revenue, and improve company performance
Executives can include chief executive officers, chief operating officers, and general managers, whose responsibilities vary based on the size of their company. In general, the larger the company, the broader the executive’s responsibilities. They can be found in every industry, including education, project management, and data analytics.
Executives need strong decision-making, management, and problem-solving skills to handle their organization’s needs. As company leaders, executives are effective multi-taskers, managing numerous projects while making sure their work is completed under deadline.
Human resources managers recruit and hire employees, discuss organizational objectives with executives, and serve as a liaison between top management and employees.
International HR managers manage workforce diversity, legal restrictions, and the relationship between training and professional development on a global scale. They align legal compliance with labor and tax laws worldwide. In addition, an international HR manager’s duties comprise of:
Aligning management with its employees to support global organizational development and culture
Coordinating and directing employee benefits programs across foreign divisions
Working with other managers on sensitive HR issues in accordance with national laws, such as equal employment opportunity
Handling staffing issues, including disciplinary action, productivity, training, compliance, payroll, and outsourcing
Supervising international contractors, support staff, and employees
Overseeing company retention procedures and ensuring a supportive, collaborative company culture
HR managers also enhance their company’s efficiency by identifying ways to keep employees motivated. For example, they might notice a decline in a department’s productivity and, as a result, recommend several strategies to keep employees motivated in order to maintain employee happiness and performance.
5. Financial Analyst
2017 Median Pay: $84,300 Estimated Job Growth through 2026: 11 percent
Financial analysts produce reports, guide investment activities, and develop strategic planning to support the long-term financial goals of a company. They combine the technical and communication skills needed to enhance their organization’s bottom line.
As investing becomes more international, global organizations want financial analysts who understand the region’s language, culture, environment, and political background. International analysts must understand how global currencies, diplomacy, and worldwide stock exchanges affect their company’s bottom line.
Global financial analysts may also focus on:
Recommending foreign investments and portfolios
Analyzing current and historical financial data to determine global market trends
Studying international economic and business patterns
Examining their organization’s financial records across global divisions
Preparing financial reports and presentations to review with management
Evaluating their company’s financial decisions to help enhance company performance
Listening to and understanding their clients’ needs, effectively communicating their recommendations to enhance client outcomes.
Financial analysts typically focus on patterns affecting a specific industry, geographical area, or particular product. For example, an analyst may focus on the healthcare industry, a region such as the United Kingdom, or the foreign stock exchange. They understand how different regulations, policies, and political and economic trends can influence individual investments and portfolios.
6. Economist
2017 Median Pay: $102,490 Estimated Job Growth through 2026: 6 percent
Economists study the production and circulation of resources, goods, and services by analyzing data, developing theories, and evaluating economic issues. They work in a variety of fields, including education, development, and healthcare.
International economists analyze global issues, such as international consumer demand for certain products or services, to help increase a company’s profits. Some economists may work for research institutes, while others work for major international organizations, such as the World Bank, International Monetary Fund, and United Nations. Many economists work for federal, state, and local governments, analyzing data about their country’s economy, including employment, pricing, productivity, wages, and other types of national data.
Global economists’ responsibilities also include:
Conducting surveys and examining international data using statistical analysis, database management programs, and other complex mathematical tools
Studying and forecasting global market trends
Creating reports, tables, and charts representing their findings
Designing policies and making recommendations to solve economic issues worldwide
Economists project spending needs and notify policymakers on the economic impact of current laws and regulations. Given their significance, economists’ findings are frequently published in newspapers and journal articles.
Policy analysts study complex problems and recommend solutions for a wide range of political issues, from homeland security to healthcare and environmental policy. They examine governments, political trends, legal systems, and other related issues, and their research helps inform public policy.
Global policy analysts typically focusonn one or more areas pertaining to international relations, such as international trade, global business policies, national defense, international economics, and foreign law. Their duties include:
Evaluating outcomes related to proposed regulations, legislation, or resources on a global scale
Monitoring international events and policy decisions
Developing and testing theories using statistical analysis and other tools
Gathering and examining data from various sources, such as election results and public opinion surveys
Identifying key trends, policies, and strategies worldwide
In addition, analysts must have strong written, public speaking, and interpersonal skills. They can work for governmental agencies or multinational corporations, often writing reports, publishing articles, and giving presentations to government officials and business executives.
From consultant to marketing manager to economist, professionals who enter international business open themselves up to roles shaping organizational strategy, directing global policy, and managing corporations.
“There are a number of different paths people can take,” Marcus says. “Find a career based on what resonates with you, what matches your skill set, and what you excel at.”
1. It’s unavoidable: business is going international.
Most Fortune 500 companies have operations all around the world – all of them have international customers. In a survey conducted by USForex, about 58% of small businesses already had international customers, with 72% planning on growing their customer base in the coming years.
2. Going international greatly benefits any business.
Some of the benefits of business going international are:
broadening a customer base,
seeing a significant increase in revenues,
having a longer product lifespan,
benefiting from currency exchange fluctuations, and
gaining access to a greater talent pool from which you can employ.
By specializing in international business, you’ll play a critical role in the exciting journey of expansion for a company.
3. You’ll have a competitive edge over other prospects.
Working across countries and cultures is a necessity for the survival of most organizations. Whether you dream of working abroad or working in an organization that is engaged in business on a global scale, having an international perspective to business gives you a competitive edge in today’s workforce. These skills and business knowledge aren’t only necessary for senior managers, but employees on all levels and from every department.
International business education is growing and offered at the undergraduate and graduate levels. For example, at FIU the 12-month Master of International Business program tackles topics including:
The fundamentals of international business and why it exists
International trade
Foreign investments
Political order and relations
Foreign policy
Sociology
Management
Global start-ups
International strategy and business model formulation
This curriculum prepares you to take on a key role in a business that will compete in the global business arena. You’ll work on improving performance while managing the ever-changing challenges of global markets.
4. International business programs prepare you to pursue lucrative roles with a high-paying salary.
There are a variety of careers that need an internationally-focused education: trading specialists, policy advisors, business analysts, and others. These roles report an average annual salary ranging from $80,000 to $125,000.
5. You’ll have the option of traveling all around the world.
Your interest in international business will take you around the world — from your studies to your new roles at work. Studying abroad is common among international business programs to prepare you to work with different cultures and leadership styles. After that, depending on the career you pursue, you’ll find yourself with the ability to travel to Europe, Latin America, Asia, and other regions around the world for business.
Key takeaways
International education can open doors to exciting and new opportunities that are otherwise harder to achieve with regular business education. You’ll be an asset to any company in any industry, providing much-needed knowledge and skills to take a business to another level. The higher salary isn’t the only great return on investment, but so is the ability to travel and interact with people from different parts of the world.
In today’s interconnected society it is essential to understand the world in an international context. Increasingly companies are looking for graduates who can solve cross-cultural problems and think on a global scale. With a degree in international business, you can follow a career in international management, finance, trade or a multinational company.
What is International Business Administration?
International Business Administration focuses on key business disciplines within an international context. Introducing the foundations of finance, marketing, supply chains, human resources and operations, International Business Administration covers the needs of all businesses.
“If you study a business programme, it’s always from the company’s perspective. You’re interested in surviving, gaining market access, beating your competitors and making a profit in the long-run”, explains Adri Meijdam MA, Executive Director for IBA at Erasmus University Rotterdam.
This degree develops a broad range of transferable skills, from research and planning to presenting and reporting, and prepares you for international management or consulting roles.
Why study International Business Administration?
There are many benefits of studying International Business Administration:
1. Gain an international perspective
You will study global challenges companies face, looking at international boundaries, trade, global economics and how to negotiate with diverse cultures. This approach to problem solving will broaden your world view and help you understand different perspectives. IBA is a popular degree among international students so even during your studies you will gain valuable experience of working with people from all over the world.
International Business Administration is a broad degree and introduces you to a range of skills that employers are looking for. As you progress through your degree programme you will begin to shape your course and specialise in the business functions you are most interested in. IBA graduates can look forward to a wide range of job opportunities in management, marketing, accounting, corporate finance, consultancy or even human resources.
4. Solve commercial challenges
Study business administration and you will analyze global and local business challenges and find strategic solutions. Through researching international markets and negotiating with other cultures and countries, you will develop the skills needed to follow a career in consultancy or management for a multinational company.
5. Build your business knowledge
How to manage diverse teams, improve financial performance, research international competitors and redesign business processes are just some examples of what you’ll learn during an IBA. This core knowledge is essential to the running of any business, and you will further develop your skills through elective modules in key areas.
Degree preparation
The International Foundation Year in Business, Economics, and Social Sciences will prepare you for studying IBA at one of our partner universities in Holland. Find out about modules, assessments, term dates, and degrees you can progress to after this course.Explore pathway
Why study IBA in Holland?
International community
Holland is a popular choice for international students, with 100,000 choosing to study here every year. For IBA students, the international classroom is a familiar environment and courses are designed to develop cross-cultural skills. Working in multicultural teams and listening to diverse opinions is ideal preparation for the world of work.
Degrees taught in English
Dutch universities offer degrees taught in English so there are plenty of options for students interested in studying abroad. Universities also have strong industry connections, giving you the opportunity to work with real businesses and develop transferable skills. For example, IBA at Erasmus University Rotterdam puts theory into practice as students analyse an existing company and write and present a business plan.
Exchanges around the world
Many universities offer international exchanges or a semester abroad after the first two years of your degree. For example, International Business Administration at Tilburg University gives students the choice of international destinations such as Hong Kong, Australia, and Italy. At Tilburg, students also benefit from one of the biggest annual recruitment events in Holland – Business weeks Tilburg – linking students to multinational companies.
International exchanges provide an ideal opportunity for you to experience another culture during your studies and impress future employers. If you want to study IBA in Amsterdam, VU Amsterdam offers students the chance to spend a semester at one of their partner universities, such as University of Sydney, University of Leeds or University of Illinois.
Build your business network
University is the perfect place to start building your business network. You will be learning from lecturers with experience in their fields, make valuable connections during internships and meet classmates who have ambitions for high-flying careers. Be sure to make the most of career services on campus where experienced advisors can guide you on your career direction. Look out for networking opportunities such as the Business Experience Days at VU Amsterdam where companies deliver presentations and workshops for students.
The best cookware worth the investment is durable, non-toxic, and lasts a lifetime. My favorite brands of cookware check all these boxes and are made from materials including stainless steel, cast iron, glass, and ceramic.
Investing in cookware is like investing in the best Vitamix or other kitchen appliances. It may cost more money upfront, but it more than pays for itself over the long haul.
So today, I wanted to deep dive into my cookware and chat about the different pieces I use the most, why I love them and why they’re worth investing in (or not investing in). This post isn’t sponsored by any of the brands you see highlighted, I’m just sharing what I truly love and use in the kitchen. Let’s jump right in!
WATCH MY BEST COOKWARE VIDEO
In this video, I’ll walk you through the various pots and pans in my collection and explain what I love (or don’t love) about them.
After you’ve watched the video, scroll down for more information and links to all of the individual pieces I mentioned in the video.
STAINLESS STEEL
My All-Clad stainless steel pans are most definitely the workhouse cookware in my kitchen and what I use on a daily basis, for everything from frying eggs, to sautéing chicken and vegetables.
The set you see me use in virtually every video I bought right out of college over 20 years ago, and it’s still as good today as it was back then. Even if it’s not quite as shiny or clean. But that’s okay because it just means that it’s been lovingly used in thousands of healthy recipes over the years.
The great thing about All-Clad is that it’s long-lasting, durable, provides uniform heating across the pan, and it doesn’t react with any foods or ingredients. And while it’s not cheap, these pots and pans truly will last a lifetime so they’re worth the investment.
I originally bought an All-Clad set, which included various sized pots and pans, but you can also buy individual pieces, depending on how many people you cook for or what type of cooking you do, and create your own set. Either way, just know that investing in high-quality stainless steel cookware is definitely a smart choice.
When it comes to enameled cast iron, I always have a hard time choosing between Staub and Le Creuset. I just love them both and have several pieces from both brands, so don’t ask me to choose a favorite.
Enameled cast Cast iron is durable and incredibly easy to clean, in fact, most of the time I just use a sponge to clean it. And unlike regular cast iron, enameled cast iron doesn’t have to be seasoned.
I use my enameled cast iron most often in the fall and winter when I make soups and stews or braise meat. And it can easily transfer from the stovetop to the oven, just as stainless steel can. If you take good care of these pieces, they can certainly last a lifetime so they’re worth the investment.
Simple, non-enameled cast iron cookware takes us back to an older time, and that’s because it truly has been around for over a thousand years.
Cast iron is sustainable, probably the most durable cookware in my kitchen, inexpensive, and healthy to cook with. It may take a bit longer to heat up, but when it does come to temperature, it can maintain that heat perfectly. And when it comes to searing a steak or getting crispy chicken skin, it’s really hard to beat.
But the best part about cast iron is that it’s the original non-stick cookware. A properly seasoned cast iron pan will easily release eggs, meat, and pretty much anything you toss in it.
You do have to be a little careful with acidic foods, so I recommend enameled cast iron or stainless steel for recipes like shakshuka. But with how cheap cast iron pans are, it definitely makes sense to have a couple of these in your kitchen.
When it comes to baking or roasting, you’ve seen me use both glass and ceramic pans. Brands like Pyrex and Corning Ware are budget-friendly, while higher-end brands include Le Creuset, Staub, and Emile Henry.
Glass and ceramic won’t release any chemicals or toxic metals into your food and they’re extremely durable, as long as you don’t cause any rapid change in temperature.
I use these all the time for casseroles and baking chicken breasts and they can easily go from the oven straight to your dinner table. So I do recommend you have a couple of these pieces in your cookware lineup.
Alright, I’ve left this one to last because many of you know that I’m not a huge fan of non-stick cookware, due to health and safety reasons.
Non-stick pans fall into two categories – those coated with polytetrafluoroethylene (PTFE) and those coated with ceramic. PTFE is the classic non-stick surface you might know better as Teflon, and ceramic pans might be called “green” pans.
Historically, PTFE pans also contained another chemical called PFOA, but this was deemed to be cancer-causing and affect growth, development, and reproduction, among other things. So, for several years now, PTFE pans no longer contain PFOA, which is good, but that chemical was just swapped for another called GenX and we don’t yet know the long-term ramifications of it.
The problem with PTFE cookware is that at high temperatures, the nonstick coating can break down and release toxic fumes and chemicals into the air and food. And if the surface coating starts to scratch and wear, it can also release toxic chemicals into your food.
So you might be thinking, well ceramic non-stick must be better, right? Well, not so fast. Ceramic pans are marketed with buzzwords like “green” and “healthy” but the surface of ceramic pans actually don’t last as long as PTFE pans. And the ceramic coating on non-stick pans is not the same ceramic that you’d find in 100% ceramic bakeware. It’s a bit misleading.
The big grey area with ceramic non-stick pans is that they contain nanoparticles that can enter our cells, and there’s not enough research or long-term scientific studies yet to understand the potential adverse effects they may have.
So for all those reasons, I’m not a proponent of non-stick, but I also like to keep things real. And I’ll be honest, I still have a couple of non-stick pans in my kitchen that I use pretty infrequently.
IF YOU’RE GOING TO USE NON-STICK HERE ARE MY 3 BIG TIPS:
Always cook on low or medium and never use a high temperature.
Always use wood or silicone spatulas so that you don’t damage the surface of the pan.
And replace your non-stick pans every couple of years or as soon as you see the surface start to wear.
Because non-stick pans are not pans you will have long-term, I don’t recommend investing in more expensive ones with stainless steel bottoms. The bottom will outlast the top. So it’s just not worth the money.
The ones I have, which are Ballarini pans, have remained perfectly non-stick for a couple of years now and so far there’s no sign of destruction to the surface, but again, I’m super careful with them.
The big takeaway is that non-stick pans should not be your daily, workhorse pans in the kitchen. There are far too many better, healthier, and more cost-effective options that will last a lifetime.
I should also mention that there’s a 100% ceramic pan, called Xtrema on the market that has been getting praise, but I tried this pan for several weeks and was personally not a fan of it. My complaints with the pan:
The lowest temperature setting must be used at all times.
I found it didn’t heat evenly (there were hot spots).
Even when using oil I found that it was not non-stick as it claimed.
It’s not durable. It’s prone to cracking and can more easily break.
UTENSILS
Lastly, when it comes to utensils I do have a couple of favorites, including stainless steel, wood, and silicone. The stainless steel utensils from Crate and Barrel are strong and durable. They never bend or warp, no matter how much pressure you put on them. I use these with all my All-Clad pots and pans.
So if you’re going to invest in cookware this holiday season, I highly recommend you invest in All-Clad, Staub, Le Creuset, and Lodge Cast Iron. They’re truly the best cookware brands with pieces that will last a lifetime, and are worth the money!
International Business is catching attention by fire and being applauded for its sustained growth and expansion in the last few decades. Most goods, services, skills and information are being marketed globally on daily basis. The self-reliance theory of Nations has taken a back seat and now a new wave constituting procurement and supply of goods and services is setting in. Countries are now being intertwined with respect to trade and investment. The very reason behind this proximity between nations is rather hidden in the fact of revolutionized system of communication and technology.
Big businesses profit from, as well as contribute to, the skyrocketing interdependence of nations. Companies like Motorola have operations in multiple countries and derive revenue accordingly through its foreign operations.
International business and globalization are two sides of the same coin and go hand in hand. The companies are required to equip themselves to tackle the intricacies of the foreign environment since it will boost the business operations globally.
What is International Business and its meaning?
When the activity of business happens to transcend borders triggered by exchange of goods and services, then it is deemed to be called as international business. The word International business cannot be crystallized into a single universally accepted definition, despite there being many definitions. It involves not only movement of goods and services but also intellectual property, technology and capital.
Business environment can be characterized in terms of:
Totality of external forces
Specific and general forces
Inter-relatedness
Dynamic nature
Uncertainty
Complexity
Relativity
Key players in international business may include multinational corporations, small businesses and entrepreneurs
Elements of business environment
There exist 5 most important elements that influence business environment are as follows;
Economic
Social
Technological
Political
Legal
Importance of international business environment
The factors that cause or drive companies to engage in international business can be classified into two parts: pull factors and push factors. Pull factors are proactive reasons that draw a company to foreign markets in order to achieve relative growth of the company. The push factors are compulsions of domestic market prospects, such as market saturation, that propel firms to internationalize.
International business environment is important from various point of views, since it helps in following ways:
Helps in expansion
Helps in managing product life cycle
Technology advantages
New business opportunities
Proper use of resources
Availability of quality products
Earning foreign exchange
Helps in mutual growth
Investment in infrastructure
International Business: Scope
Scope of International business has a broad reach since it concentrates on specific issues and opportunities that arise in the business world when a company operates on a global scale. International business is a broad area of business that has been tailored to absorb unique characteristics of the global climate.
In comparison to the domestic world, foreign companies operate in highly unpredictable environments wherein the rules are often vague, inconsistent, and subject to rapid change.
International business is inclusive of trade in services, foreign trade, portfolio investment and direct investments (FDIS)
International Business: political environment
The role of politics in business environment has long been implicitly recognized. Variations of government or state officials, along with aggression and conflict, are common political occurrences. Political risk in business occurs as the business climate undergoes difficult-to-predict changes as a result of political reform. These shifts in the market environment are considered a threat because they have the potential to greatly affect a company’s profit or other objectives. Constraints on the firm typically encompass expropriation, restrictions on remittance of profits, discriminatory taxation, and public sector competition.
International business: technological environment
With ever changing technology and unreliability of external factors, the company that understands it and adapts its operations likewise shall have an upper hand in capturing the market. The companies must take into account the fact that technology becomes obsolete within a blink of eye and therefore must readily adopt its newer forms to have a competitive edge.
International Business: cultural environment
The cultural environment in which the international business has to operate is quiet complex in itself since fundamental values and attitudes differ from country to country. Point to be noted is that the culture is a byproduct that has stretched over a long time in evolving and dispersing. It can cast pose major conflicts.
International Business Strategy
International business strategy involves balancing an MNE’s core competences (in contrast to competitors) with the challenges and opportunities encountered in geographically dispersed environments that cross international borders.
Types of International Business Environment
The following types of international business environment can be enlisted as follows:
Imports and Exports
Licensing: Franchising
Outsourcing and Offshoring
Joint Ventures and Strategic Partnerships
Multinational Companies
Foreign Direct Investment
International Business: Benefits
International business offers variety of benefits to both the countries and business entities which are as follows:
It encourages a country’s specialization in the production of goods that are both high-quality and affordable.
It aids a country’s growth prospects while also providing opportunities for jobs.
Individuals may use goods and services created in other countries to boost their quality of living, thanks to international business.
It assists companies in increasing revenues by selling goods in countries where prices are high.
Is International business affected by demographic variables?
Our main query at hand is to know whether demographic environment does not influence the international business decisions? To answer this first we should know about demographics. Demographics are a set of attributes that can be used to assess a consumer’s product preferences or shopping patterns. Some companies use these characteristics to identify their most valuable customers. Some of the demographic variables that affect international business are as follows:
Income’s influence
Age variables
Geographic Regions
Level of education
What are the factors that affect international business environment?
Political Factors: International business is vulnerable to political environment of a country. To be specific political risks might include war, revolution, civil disturbance, closed trade routes, nationalization, trade embargos and inconvertibility of local currency. Government policies can have a profound effect on business through introduction of new regulations and legislations.
Financial and monetary factors: International transactions are exposed to financial risks such as cost and availability of capital in a number of countries. Further fluctuation in exchange rates can have a tremendous impact on the economic balance of international business.
Legal Factors: Parties acting internationally are subject to several jurisdictions. The multiplicity of laws can lead to the delicate situation of mutually exclusive obligations.
Interpersonal factors: It constitutes barriers to effective communication. Typically parties to an international business find it difficult to understand, predict and monitor the behavior and wants of other side.
Culture: Cultural differences pose a risk factor and is a source of frequent conflicts and act as a barrier to effective conflict management. Fundamental values and attitudes differ by large scale.
Conclusion
In the nut shell it can be concluded that different markets, cultures, legal systems, economies, and technology contribute to the complexity in international business, all of which must be incorporated into business policies and practices. International business devise strategies to take advantage of the opportunities presented by the environment. As a direct consequence, international business differs from domestic business due to differences in the environmental dynamics and operational nature.
There was a time when consumers only had access to goods and services that were available locally. Their choices were limited by what they could access on foot, by horse, or by carriage. This is still the case for many people around the world, and in rural and remote parts of the U.S., it’s still necessary for families to make weekly trips to town to stock up on food, household items and other necessities. However, with the rise of Internet-based business (think Amazon), there’s been an explosion of international trade, and more and more consumers essentially have the world at their door. Of course international trade isn’t just a twentieth-century phenomenon. Trade across borders and between cultures has been a feature of human civilization for centuries—there’s evidence of this dating back as far as the nineteenth century BCE. The Silk Road, one of the best-known and most enduring “international” trade routes, began sometime around 200 BCE and for centuries was central to cultural interaction from China through regions of the Asian continent all the way to the Mediterranean Sea.
So, if cultures and nations have been trading with one other for four thousand years, what makes today’s business landscape different? The answer lies in the distinction between international business and globalization.
International business refers to commerce in which goods, services, or resources cross the borders of two or more nations. This is what the Egyptians were doing when they sent goods across the Red Sea to Assyria. Globalization is broader than international business and describes a shift toward a more integrated world economy in which culture, ideas, and beliefs are exchanged in addition to goods, services, and resources. Globalization implies that the world is “getting smaller”: As a result of new transportation and communication technologies, people around the world can more readily connect with one another—both virtually and geographically.
The following video provides a good introduction to the causes and consequences of globalization.
The video, above, provides a good bird’s eye view of the affect of globalization on business—from opening up new markets to increasing the level of competition within markets and industries. Let’s take a look at particular example, though, to think through the various implications of conducting business on a global scale. Consider McDonald’s, which was started by two brothers in San Bernadino, California, sixty-eight years ago. As a result of globalization, nearly 69 million people in 118 different countries eat at McDonald’s every day. The first McDonald’s outside the U.S. and Canada was established in Costa Rica in 1970, and since the 1990s, most of the company’s growth has taken place in foreign countries. The process of building a global presence, entering new markets, and capitalizing on growing international demand for American fast food has enabled McDonald’s to expand from a single location to a global corporation with revenues in excess of U.S. $25.4 billion in 2015. [1] However, entering new markets—whether at home or abroad—means contending with increased competition in those markets, including competition with other globally minded companies. In 2010, Subway surpassed McDonald’s to become the largest single-brand restaurant chain and the largest restaurant operator globally.
What is it like for companies that decide to take advantage of global opportunities as McDonald’s and Subway have? Return to the discussion of “external forces” in module 1, but now consider them from a global business perspective. Globalization certainly means that businesses can reach consumers around the word more rapidly and efficiently—thanks to cell phones, airplanes, and the Internet, we are all so much more interconnected and “accessible” now. But globalization also means incredible complexity. The list below sketches out just a few of the complexities and challenges that an American fast-food company like McDonald’s faces when it takes on the global business environment.
The Global Economic Environment: McDonald’s is a corporation based in the United States, where all business transactions are conducted using the U.S. dollar, but there are 167 official national currencies in the world, each with a different value and purchasing power. Imagine trying to balance the corporate checkbook at McDonald’s when your deposits have been made in more than a hundred different currencies.
The Global Legal Environment: In Greece, there is a $650 fine for eating ice cream at certain historic, artistic, and culturally important sites. If you are the operator of a McDonald’s near the Parthenon, should you remove the ice cream cones and McFlurries from your menu to protect your customers against being fined, or not?
The Global Competitive Environment: How does McDonald’s recapture the number-one position it lost to Subway in 2010? The company may need to make substantial changes to its operations, menu offerings, and/or marketing tactics. This is a steep, uphill climb in the United States alone, but consider trying to accomplish it in 118 different countries in 188 different markets—where you are competing not only with other global U.S. fast-food companies like Subway and KFC but with local ones, like “McKebab,” as well!
McKebab, a fast-food restaurant in Slovenia whose name and golden “M” bear a striking resemblance to McDonald’s.
The Global Technological Environment: What does technology have to do with fast food or McDonald’s? Consider the company’s presence in China, where there are nearly 1.3 billion mobile users, and say hello to “McDonald’s Next,” a “modern and progressive” version of the restaurant that first opened in Hong Kong, featuring mobile-phone-charging platforms, free Wi-Fi, and self-ordering kiosks. This next generation of McDonald’s is a response to increased expectations around speed, service, economy, and availability across established and developing economies, mostly fueled by consumers’ growing access to affordable technology. As global businesses respond to demands created by technology, they must also leverage technology to move products, people, and supplies around the globe in a cost-effective and efficient manner.
The Global Social Environment: McDonald’s has had to adapt in countless ways to meet the demands of its customers around the world. While it prides itself on offering a consistent, internationally recognizable menu and brand, the company has also had to cater to local dining preferences and customs. In 1995, for example, the first kosher McDonald’s opened in a Jerusalem suburb. In Arab countries, the restaurant chain offers “halal” menus, which comply with Islamic laws governing the preparation of meat. In 1996, McDonald’s entered India for the first time, where it offered a Big Mac made with lamb called the Maharaja Mac.[2]
McDonald’s Maharaja Mac
McDonald’s is not a complex business—after all, it sells inexpensive burgers and fries, not automobiles or airplanes or pharmaceuticals—but clearly the global environment presents challenges even for them. You may be wondering why nations and businesses decide to take on such challenges, given the ongoing difficulty, risk, and uncertainty. We’ll investigate this question throughout the remainder of this module.
Absolute and Comparative Advantage
Introduction
Consider the humble banana. Even if you’re not a big fan of this yellow fruit, you’ve surely seen them in the grocery store or in a market somewhere. If you walked through a U.S. city with a banana and asked people to identify it, it’s unlikely you would encounter anyone who had no idea what it was. What if you did the same thing with a picture of a bananatree? How many people could identify it? Maybe some, but not all. Why is that? In the United States, bananas are grown in Hawaii, and not everyone has been to Hawaii. In fact, most of the bananas in the world are grown in Ecuador. If we Americans love bananas and don’t live in Hawaii and can’t get to Ecuador regularly, without global trade, we’re out of luck: no bananas for cereal in the morning or as snacks during the day and, worse, no banana splits at the local ice cream parlor. Why do Ecuador and Hawaii trade away their bananas instead of keeping them all to themselves? Probably because, although bananas are delicious and nutritious, it’s hard to build houses out of them. Instead, the state of Hawaii and nation of Ecuador choose to trade their bananas for things they lack, while considering the cost and profitability of exporting their product.
Ecuador and Hawaii offer an example of comparative advantage. Because bananas are not grown or readily available everywhere in the world, Ecuador and Hawaii can profitably export theirs to banana-less places like Iowa and Canada. At the same time, Ecuador may need computer systems to keep track of all of those bananas they are selling, but Ecuador is not a technologically advanced economy like the United States. The United States has a comparative advantage in computers, so we sell our computers to Ecuador and let them concentrate on selling us bananas.
The Concept of Advantage
In order to understand why businesses are willing to operate in a complex global environment, we must first understand two fundamental concepts that drive almost all business decisions: absolute and comparative advantage. Countries and companies are willing to assume the risk of engaging in global trade because they believe that they have an advantage over the competition that they can turn into profits. Not all countries have the same natural resources, infrastructure, labor force, or technology. These differences create advantages that can be exploited in global trade, to a country’s (or company’s) benefit.
Absolute Advantage
An entity (country, region, company, or individual) is considered to have an absolute advantage if either of the following conditions exists:
(1) It is the only source of a particular product, good, or service. This kind of absolute advantage is very rare and usually depends on a particular natural resource being available only within a certain region or country. An example might be the coveted edible red bird’s nests found only in the caves of Thailand (and prized in Chinese cooking as the main ingredient in bird’s nest soup). Similarly, if Ecuador were the only place in the world where bananas could be grown, it would have an absolute advantage. However, suppose some sneaky banana spy goes to Ecuador and pilfers some banana tree seedlings and takes them back to her home country and begins growing and exporting bananas. At that point Ecuador no longer has an absolute advantage on the basis of the “only-source” condition.
(2) An entity is also considered to have an absolute advantage if it is able to produce more of something than another entity while using the same amount of resources (factors of production). When the sneaky banana spy started growing bananas in her home country, she didn’t actually take away Ecuador’s absolute advantage, because Ecuador can produce more bananas using the same amount of resources (labor, land, water, equipment, etc.). Put another way, Ecuador’s direct cost of producing bananas is lower than the banana spy’s. Assuming that the bananas can be grown in the new country, it will take that country a very long time to match Ecuador’s skill, efficiency, and output level, and until it does, Ecuador will retain its absolute advantage.
Comparative Advantage
An entity (country, region, company, or individual) is considered to have a comparative advantage over another in producing a particular good or service if it can produce the good or service at a lower relative opportunity cost.
You’ll recall from the economic environment module that opportunity cost is the value of the next best alternative. (The video, below, also includes a refresher on this concept.) Since countries and businesses have limited resources, they are forced to make choices about how they allocate those resources. As a student, you understand opportunity cost better than you think. You have a limited amount of time, and you must choose between reading this module and going out with your friends, because you can’t do both. If you choose to go out with your friends, then the opportunity cost might be failure on your next exam because you did not use the time to prepare.
Ecuador has a comparative advantage in bananas over a long list of countries, including the United States. This comparative advantage is even better understood when you consider that their next best alternative product is oil. The Middle Eastern countries have been pumping oil from the ground for as long as Ecuador has been growing bananas. It makes as much sense for Kuwait to attempt to export bananas as it does for Ecuador to export oil. It’s the reality of comparative advantage that encourages countries and businesses to do what they do best—leaving the production of other goods and services to other countries or companies—and in so doing, focusing on producing goods and services where they have advantage, thus maximizing their opportunities in a global environment.
The following video provides an excellent illustration of comparative and absolute advantage and explains why they are such important considerations in how countries decide to specialize and trade.
Still unsure about how these different kinds of advantages play out in the real, complex world of global trade? Up next: Try your hand at ruling your own island nation and choosing trade partners on the basis of comparative advantage.
Game: Trade Ruler
It’s one thing to talk and read about global business and another to actually engage in global trade. You don’t have the time or resources to set up your company, apply for permits, establish trade agreements with other nations, and manufacture your goods right now, but that’s not a problem—those things have already been done for you!
The link below will take you to the Nobel Prize Web site, where you will participate in the simulation “Trade Ruler” and, as leader of your land, see how well you can leverage your advantage to increase the wealth of your island nation.
How It Works
Once the game launches, you will be prompted to select one of four islands to control. Choose wisely, as each of the islands is endowed with labor and capital, but they aren’t equal. Some islands offer an abundance of labor but very little capital (technology), and others are capital rich but have a very small labor force. Which island you select will determine what you can produce to capitalize on your resources.
After you have chosen your island, you will be given the opportunity to create an avatar and enter your name.
Once you have an identity, you must choose one of the remaining three islands with whom to trade. Look carefully at what your trade partner has to offer! Consider the “advantages” you have and those of your trading partner.
Once you begin production, you will be able to trade cell phones and blue jeans with your partner.
At any time during the simulation, you can ask for “council” by selecting the button on your television set! Listen carefully to the advice of your counselors, watch the economy of your island (as measured in seashells), and adjust your production and trade transactions accordingly.
You’ll be able to play three rounds, with the goal of improving the economic and social conditions of your citizens.
Increasingly nations and business use their comparative or absolute advantages to enter global markets driven by the same factor: the immense size of these markets.
Let’s return to the banana for a moment. In 2015, Ecuador exported 6.55 million metrictons of bananas. Without a large global demand for bananas, every man, woman, and child in Ecuador would have to eat 834 pounds of them per year to consume all of the production. Of course, that wouldn’t happen: Instead, the country would simply cut back on the production of bananas—but, in so doing, it would lose an export that now accounts for more than 10 percent of its gross domestic product (GDP). Ecuador needs a large and vibrant global market to keep up with its tremendous supply of bananas, and it relies on the revenue from those bananas to purchase the other things it needs (in the same way that you traded cell phones for blue jeans in the island trader simulation).
Later in this module, we’ll discuss how nations like Ecuador enter foreign markets, but for now let’s look more closely at the size of the world’s largest markets. The following table shows population and GDP data for the top five economies in the world as of 2015.[3] You’ll recall from the economic environment module that GDP, or gross domestic product, is a monetary measure of the market value of all final goods and services produced in a period, and the GDP growth rate is the increase or decrease in GDP over a period of time, expressed as a percentage.
Country
GDP
Population
GDP Growth Rate
China
$19,390,000,000,000
1,367,485,388
6.90%
European Union
$19,180,000,000,000
513,949,445
2.20%
United States
$17,950,000,000,000
321,368,864
2.40%
India
$7,965,000,000,000
1,251,695,584
7.30%
Japan
$4,830,000,000,000
126,919,659
0.50%
Looking at the figures in this table, it isn’t hard to imagine that a country or company would like to have a foothold in one or all of these markets. Taken together, these five economies represent a lot of people, a lot of purchasing power, and a lot of economic growth. However, the immensity of the global market offers more than just new target customers. Consider some of the following benefits nations and firms realize by entering foreign markets.
Access to Factors of Production
You will recall that the factors of production required for a successful business venture are natural resources, capital, human capital, and entrepreneurship. Access to global markets enables countries and companies to acquire these factors of production when they are nonexistent, scarce, or just too costly at home. For example, India is one of the largest providers of telephone-based customer service (labor) worldwide, which makes sense given that its population is second only to China and almost four times that of the United States. In addition, labor costs in India are significantly lower than in the U.S.
Innovation and Ideas
Many companies enter global markets and, once there, discover unmet needs or unique products and services. They are then able to use their discoveries to expand an existing product line or introduce new products in other markets or at home. For example, many people credit the United Kingdom with inspiring the development of the craft beer industry in the United States.
Risk Reduction
Given the complexity of operating a business globally, it may seem like a contradiction that risk reduction is one of the benefits of a large global market, but it’s actually true. If a country or a company trades or does business with multiple foreign partners, they are less dependent on the success of any single partnership. Likewise, if a nation or business has multiple global sources for factors of production, then if one source “dries up,” they will still have access to what they need. For example, in 2010 China halted its export of rare earth minerals to Japan after the two countries were unable to resolve a territory dispute. Japan used these minerals in the production of everything from cars to computer chips, and to say that the Japanese were in a state of distress is an understatement. As a result of this albeit brief reduction in Chinese supply, Japan established a trade agreement with India for the import of the needed materials. They will no longer be totally dependent upon the Chinese for these important resources.
In summary, globalization makes business on a global scale possible, and the size of the global market makes it attractive. By using their absolute and comparative advantages, countries and companies can leverage their resources to produce and trade the things that benefit them the most.
The following video provides a recap of the main reasons why countries and businesses engage in global trade.
Answer the question(s) below to see how well you understand the topics covered above. This short quiz does not count toward your grade in the class, and you can retake it an unlimited number of times.
Use this quiz to check your understanding and decide whether to (1) study the previous section further or (2) move on to the next section.
