WHAT IS THE DIFFERENCE OF MULTINATIONAL, GLOBAL AND TRANSNATIONAL COMPANY? | NATURE OF INTL BUSINESS

00:15:24
https://www.youtube.com/watch?v=xqBvtkYpbD4

Summary

TLDRThe video presents a detailed explanation of international business focusing on three types of companies: multinational, global, and transnational. A multinational company adapts its products and services for local markets, such as McDonald's customizing its menu in different countries. Global companies maintain consistent products globally, while transnational companies have a centralized facility but delegate decision-making to local markets. The video also highlights international business challenges like government restrictions, trade barriers, and inflation, which affect operations. Benefits, such as economic growth and employment from international trade, are noted, alongside the concept of economic integration, where shared resources across countries increase efficiency. The discussion covers the domination of international business by developed countries due to their technological and financial capacities, and the importance of market segmentation in addressing diverse consumer needs. Sensitivity to political and economic changes also impacts international business, affecting strategies and profitability.

Takeaways

  • 🌎 Multinational companies emphasize local market adaptation.
  • 🏢 Global companies offer uniform products worldwide.
  • 🔄 Transnational companies empower local decision-making.
  • 💡 Economic integration involves shared resources across borders.
  • 🏆 Developed countries lead in international business dominance.
  • 📈 International business spurs economic growth and development.
  • 🌍 Market segmentation caters to diverse consumer demands.
  • 🔍 Government restrictions influence international trade.
  • 💸 Inflation affects international product and service costs.
  • ⚖ Balance between local adaptation and global consistency is crucial.

Timeline

  • 00:00:00 - 00:05:00

    The speaker introduces the topic of international business by discussing different types of companies: multinational, global, and transnational. Multinational companies adapt their products and services to local markets to lower costs and tailor to specific needs, as exemplified by companies like McDonald's and KFC, which offer different products in different countries. Global companies maintain consistent offerings and processes across all countries, such as Adobe. The discussion emphasizes adapting to local markets to be cost-effective and competitive.

  • 00:05:00 - 00:10:00

    The speaker explains transnational companies, which have invested in foreign operations with a central corporate facility but delegate decision-making to local markets. An example given is Nestlé, which hires executives globally to make decisions from a global perspective. The video also highlights international restrictions like trade barriers and foreign exchange affecting business operations, and how inflation impacts costs. The benefits of participating in international business include foreign capital, technology access, and economic development for countries.

  • 00:10:00 - 00:15:24

    The discussion highlights the nature of international business, including large-scale operations and the integration of economies, where companies utilize resources from different countries, benefiting both parties. Developed countries, with advanced technologies and financial capacities, dominate international business. Market segmentation is emphasized, where international businesses cater to different consumer demands across regions. The sensitivity of international business to political and economic changes is noted, affecting business operations positively or negatively.

Mind Map

Video Q&A

  • What is a multinational company?

    A multinational company adapts its products and services to each local market.

  • How does a global company operate?

    A global company has consistent offerings and processes across all countries it operates in.

  • What distinguishes a transnational company?

    A transnational company has foreign operations and a central facility but allows local markets to make decisions.

  • Why do multinational companies adapt their products?

    They adapt to lower costs by using local materials and to better fit local market demands.

  • What is an example of a multinational adaptation?

    McDonald's offering certain local menu items, like rice in some markets.

  • What role do restrictions play in international business?

    Governments impose restrictions like trade barriers that can impact international business operations.

  • How does international business benefit participating countries?

    It brings economic growth, industrial development, and employment opportunities.

  • What is economic integration in international business?

    It involves using resources from different countries, benefiting all involved economies.

  • How do developed countries dominate international business?

    Developed countries have strong financial and technological capacities that enable dominance in international business.

  • What is market segmentation in international business?

    It's producing goods that meet the varying demands of consumers in different market segments.

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  • 00:00:00
    [Music]
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    right now
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    since we are tackling or discussing the
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    international business
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    three types of company name i encounter
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    so i
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    want to differentiate each of them
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    so the first one is multinational
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    company
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    national company according to
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    marketbusinessnews.com
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    multinational companies are more focused
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    on adapting
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    their products and service to each
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    individual
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    local market okay so again companies
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    that
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    are these are international businesses
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    okay
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    they they branched out in other
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    [Music]
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    mcdonald's
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    there are slight differences okay so for
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    example
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    i heard before name salad and some
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    mcdonald's
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    um there are some like kfc i had
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    in the industry offering rice
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    i
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    [Music]
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    again so they are more focused
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    on products and services
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    in offering made differences in offering
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    in other products and services
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    are comparison
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    that is one of the reasons why
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    multinational companies are
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    adapting okay they are basing
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    their products and services context no
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    particular country
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    okay and one reason then is to lower
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    their costs
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    so putting atom
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    [Music]
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    or materials readily available in that
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    country so yuan so
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    that's why they are engaging in or they
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    adopting their products and services to
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    each individual local market
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    how about global company global company
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    according to lazari
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    um global companies has a
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    global company has a foothold in
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    multiple countries
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    but the offerings and processes are
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    consistent in each country
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    okay global company
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    offices production facilities in more
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    than one country
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    with multinational company and
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    difference is your processes
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    your ingredients your materials do not
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    change
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    in the global model okay
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    marketing style okay so what are
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    the some global companies
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    for example adobe
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    but um there is one case and
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    and that's a motion again and i'm going
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    to give it to you
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    um on the link below so there is one
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    case in google ana
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    mcventure so chinese china
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    but uh they are forced to
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    um uh to add the
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    image
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    but right now they are not offering any
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    more in china so
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    um in each country
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    [Music]
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    offerings our product offerings
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    it's the same with hilton and hyatt
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    hotels okay
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    so next is so that's multinational
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    company
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    again it's a multinational company more
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    focused on adapting
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    the products and services a local market
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    see
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    global company demand and
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    consistency on products and services in
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    each country
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    how about this and see transnational
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    company
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    okay it's a transnational company they
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    have invested in foreign operations
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    they have a central corporate facility
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    but they give decision making research
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    and development
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    and marketing powers to each individual
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    local market
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    okay this is harding to meet that okay
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    so the transnational company is more
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    complex
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    okay one example is nasty
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    so they have a central corporate
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    facility
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    okay but they um
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    they hire senior executives
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    from many countries okay and they try to
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    make decisions
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    from a global perspective rather than
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    from
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    one centralized headquarters okay so
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    that's
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    transnational company so they have a
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    central corporate facility
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    but multi-racial
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    young decision marketing is multi-racial
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    um uh they are
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    getting sober in empowering research and
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    development
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    but for
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    so and these natures
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    are greatly affecting the international
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    business itself
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    there are international restrictions
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    okay
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    and again such restrictions are relating
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    to foreign exchange
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    trade blocs trade barriers and so on
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    so as we all know yuma restrictions
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    imposed on government do that in
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    different countries
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    okay so
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    okay so that's why there is really a
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    great
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    international restrictions in an
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    international business
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    so these things at omaha restrictions at
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    all may greatly affect the international
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    businesses
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    yet shampred to protect
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    their own country and so
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    [Music]
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    second inflation uh it affects the
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    international business
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    right
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    now costs no products and services
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    depended on service restrictions
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    [Music]
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    in that particular country next one is
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    can see international business have
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    benefits to participate in countries
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    so um
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    benefits
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    as we can observed as we can observe
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    those countries which grow their
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    business to the international level
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    they tend to get richer and more
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    developed
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    okay see the atomic developing countries
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    center they usually get
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    there for the foreign capital their
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    capital in
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    another country they benefit
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    from the latest technology
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    they experience the rapid industrial
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    development and employment opportunities
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    so yeah which helped them in developing
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    their economy anymore so if you are
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    igor mansa philippines
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    it benefits us it provides jobs for us
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    so there are benefits or it's a win-win
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    situation for the both
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    of the countries
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    [Music]
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    some particular country okay so next
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    month is international basis
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    has large scale operations social
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    international level compares
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    alibaba domestic business i believe in
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    my international businesses
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    is they started with their domestic
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    level
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    so
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    so the goods and the services that they
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    are providing in their
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    in the domestic level our viewer
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    compares a large market
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    okay global level
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    okay this is a good nature for the
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    countries
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    because well they are earning for
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    domestic demands
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    okay um
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    [Music]
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    okay so that's one of the nature of
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    international business
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    next is integration of economies okay so
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    most of the time the companies utilize
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    the labor
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    resources finance and establishments of
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    other countries
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    which is a win-win situation for both
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    that may benefits the man on the economy
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    of both countries
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    so they provide employment and other
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    opportunities
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    to where the company is working on well
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    your company
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    they are earning at the same time
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    another great example of economy
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    integration
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    is when the parts of a product are made
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    in different countries
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    okay for example
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    in different countries there is
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    integration of economies
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    though that is one of the great examples
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    of integration of
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    economies okay so next amendment is
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    one nature in an international basis it
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    is it is dominated by developed
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    countries
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    so whether we admit it or not developed
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    countries like the usa
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    japan and europe europe
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    they have the large financial capacity
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    okay
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    they have the best technologies they
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    have the
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    large fund for research and development
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    and so that's why it helps them to
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    dominate the international business
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    so um uh whether
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    we admit it or not uh but
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    my lucky percentage
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    segmentation so one of the natures of
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    international business
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    is it produces goods according to the
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    demand of consumers of different market
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    segmentations
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    okay alumni and that the demand of the
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    consumers
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    varies greatly in different countries
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    okay
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    that is why see international business
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    have um or its nature okay
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    is the market segmentation so um
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    some global companies
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    [Music]
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    okay and whereas multinational companies
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    are
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    spreading dependence and nature or
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    non-business that is why they are
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    offering different products and services
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    but those are all market segmentation
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    okay
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    next one is it is sensitive in nature
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    it is highly affected by political
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    environment changes in economic policies
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    upgrading technologies and etc a race
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    international business
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    it is very sensitive okay why
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    because it can either affect the
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    business in a positive or negative way
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    so these
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    um events
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    it can greatly affect positively or
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    negatively
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    your international business more so so
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    the different policies implemented by
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    the government is what
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    businesses totally depend on the
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    dependent businesses so
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    it can help them in business expansion
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    maximize their profits or vice versa so
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    imagine for example um
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    since
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    president duterte
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    [Music]
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    okay they have to obey okay so that is
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    one
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    of the sensitive nature in an
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    international business
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    happenings or maraming events that
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    greatly affect
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    the international business
Tags
  • International Business
  • Multinational Companies
  • Global Companies
  • Transnational Companies
  • Market Adaptation
  • Economic Integration
  • Trade Barriers
  • Inflation Impact