Socio and Economic Factors in Global Business Essay -- GCSE Business M

Socio and Economic Factors in Global lineWhen a company decides to take their ancestry international, there be legion(predicate) different sociological and economic factors that they need to take into account. There are differences in management styles, international laws and treaties that limit international worry, as healthful as ethnical customs that come into play. Each of these are probative and needs to be taken into account in order to pick at potential problems. Many times, lack of knowledge stand fabricate wicked problems. Although there are a myriad of socio- and economic factors, this paper pull up stakes focus on three key ones 1) political barriers 2) labor practices and 3) cultural barriers. Additionally, real world examples allow for be offered on how some businesses hand successfully overcome these barriers.Political BarriersFor purposes of this discussion, political barriers refer to the geo-political situation of a plain, as well legal barriers such as tariffs, taxes, etc. Countries preparation up barriers to foreign entities conducting business within their borders (especially imports and exports) for several reasons. Duties and taxes can create some government revenue. If there is a high tariff hence there will be less exporting, therefore more of that harvest-festival in the country, thus making the price of that product in the country lower since there will be a greater supply. So craft barriers can be helpful to a country. On the contrary, trade barriers can have a negative effect on a country as well. Consumers will have to pay a high price on imports, and for similar products produced in the country the price will rise due to consumers buying the imported products. In order to regulate the barriers on international trade, there have been organizations formed. GATT (General Agreement on Tariffs and mountain), WTO (World Trade Organization) and NAFTA (North American Free Trade Agreement) are just a few example s (Czinkota, 1999). Other considerations in overcoming political barriers are the governments themselves. Conducting business in Cuba is nigh impossible for American companies probably until the fall of the Castro regime. Domestic and international press on human rights, governments considered to be corrupt or illegal whitethorn also hamper an organizations ability to do business in certain regions of the globe. Although these factors... ...zed crime, etc (Fortune Small Business, 2000).Conclusion This discussion has highlighted but a few socio- and economic factors that must be considered when deciding to conduct business in a foreign country. As one can demise, the risks are there, but the potential for profit is very alluring. With prior proper planning, the risks can be limited. However, it will serve businesses well to incorporate economic factors into their overall global business strategies.References Czinkota, M., Ronkeinen, I., Moffett, M. (1999) Inter national Business. Fort Worth The Dryden Press DSN sell Today (2001, June 5). Open trade in billion-man market creates empire of opportunity. economist (1997, June 21). 99% perspiration. Vol. 43, Issue 8022. Fortune Small Business (2000, April). East meets Mex. Hofstede, G. (1984). closes Consequences. Beverly Hills, Ca Sage Publications. Orange County Business Journal (2001, April 23). OC companies do business in China over tea, gestures. Winter, D. (May 2000). Facing globalization. Wards Auto World. Vol. 36, Issue 5. (www.doc.gov) (www.opic.gov) (www.usatrade.gov)