INTERNATIONAL BUSINESS- INTRODUCTION

 International business involves exports and imports. International Business conducts business transactions all over the world. These transactions include the transfer of goods, services, technology, managerial knowledge, and capital to other countries. International Business is also known, called or referred as a Global Business or an International Marketing.

By the term international business is understood ‘as all commercial transactions-private and governmental-between two or more countries. Private companies make such transactions for profit; governments may or may not do the same in their transactions. These transactions include sales, investments, and transportation. Thus international business consists of a large and growing portion of the world’s total business.  Today, global events and competition impacts almost all companies-large or small-because most sell output to and secure supplies from foreign countries. Many companies also compete against products and services that reach from abroad. A company operating in the international business arena will engage in modes of business, such as exporting and importing, that vary from those it is practiced to on a domestic level. To operate effectively, managers ought to understand these different modes. The importance of international business in the new century has enhanced tremendously. The fact is that international business makes it possible for us to have the quality goods and services available at the prices we are willing to pay. International business is gaining increasing significance because it comprises a large and growing portion of the world's total business. International business acquires significance as it creates a stable ground on which companies can expand their markets and operations. This is attributed to the fact that no country can stand alone without having to engage in trans-border transactions hence there is need to include the neighbouring countries, as well as, the international community. This will lead to a wider market for goods and an even wider source of raw materials essential for producing the products that are altered or exported.
The increased levels of globalization have also led to elevated international business as more people are getting involved in multinational corporations. In this respect, the investors often open subsidiary branches of their companies in other countries hence their transactions are carried out across the borders. Consequently, improved communication by introduction of the Internet has generated increased interest in the ability to transact business across continents without having to shift the locality in terms of being mobile. Hence it becomes even easier to locate business enterprises where it is more likely to attract more profits and this could be in foreign countries.
Every company is trying to expand its business by entering foreign markets. International business helps companies grow geographically. Geographic expansion may be used as a business strategy. Even though companies may expand their business at home. International business helps companies in managing product life cycle of their products. Every product has to pass through different stages of product life cycle-when the product reaches the last stages of life cycle in present market it may get proper response at other markets. Companies having outstanding technology advantages gain through the achievement of core competency. This technology helps the company in capturing other markets. Business opportunities in overseas markets help in expansion of many companies. They might have reached a saturation point in domestic market.
It results in the proper use of resources available with the firms like labor, minerals etc. but are not productively utilized. Further, the international business makes availability of quality products when markets are open. Foreign companies will market latest products at reasonable prices. Also the firms doing international business earning foreign exchange may be used for strategic imports. India, in particular, needs foreign exchange to import crude oil, deface equipment, raw material and machinery. In International business countries depend upon each other for meeting their requirements. India depends on gulf countries for its crude oil supplies. International business necessitates proper development of infrastructure. A company entering international business must invest in roads.