International Business Organization Development Factors For Consideration

International Business Organization

Export/International business can take on many challenges as it unfolds. Goal should be to construct the company’s strategic building blocks, using it’s assets to support international opportunities. The outline is formatted from a more basic approach, increasing through stages of complexity. There will be points below that overlap and dovetail. Some corporations may have already touched on many of these points. The examples below are geared toward the food/protein industries. Nevertheless, the concepts are transferable to many others. Below are organizational ideas for consideration:

I. International Business Unit Establishment- Create P&L.
A. Budget to encompass 3-5 key trade shows and conferences that support the geographic strategy.

- Restaurant Chain Shows (Subway, McDonalds, etc.)- Important shows that demonstrate a company’s willingness to globally expand with the chains.

- Distributor Shows.

- Trade organization conferences. Provide key insights to new emerging markets and trends i.e., USMEF, USDEC, etc.

B. Forecasting- By product category and market to determine business profitability.

C. Expenses- Identify expenses against the business. Be fiscally prudent.

II. Geography- Are the most immediate markets being efficiently addressed by export? Begin with the immediate opportunities i.e., target nearest or import friendly international geographic markets.

A. Canada-

B. Mexico-

C. Caribbean-

D. Domestic Exporters-

III. Export Product Portfolio- Product’s export potential? What are the popular US items sold? Using meat products as an example:

A. Pork- More than likely highest export potential.

B. Poultry- Certain drawbacks (Avian viruses), but often has the necessary price points for market entry.

C. Beef- Still questionable into many overseas markets (BSE). Slowly improving.

D. Other- Veal and lamb offer the specialty items often sought in many of the smaller boutique markets i.e., Caribbean. Should be a high margin opportunity?

IV. Utilize and maximize current customer base. Grow internationally with domestic customers.

A. Chains- What chains are currently being serviced (i.e., McDonalds)? What are the int’l springboard applications of those chains?

B. Distributors- GFS,US :: GFS, Canada; Sysco, US :: Sysco, Canada…Sysco, Export
C. Schools- Offer products supplied to the US to Puerto Rico. Puerto Rico, Virgin Islands and Guam have same requirements.

D. Retail.

V. Expand Geography- Be first in emerging markets. Chains, trade organizations and trade shows will assist in breaking into new venues.

A. Australia, open to US pork imports. US plants must be Australian approved.

B. Brazil and Argentina- as economies improve, so should pork imports.

C. Middle East- Israel.

D. Asia- SE Asia, Latin America.

VI. Product adaptation-

A. A commitment to international product customization. Overcome import non-tariff barriers through product modification.

B. As point “A” is evaluated, determine volumes and pricing with the customer completing the value proposition.

C. New protein introduction- Growing US Hispanic community looking to satisfy traditional diets i.e., goat. US ranchers begin to emerge from their traditional ranching habits to fill a consumer need. Shift creates new export opportunities.

D. Profit Margin/Revenue Growth- Theoretically, there is no competition for custom production and margins should reflect business value.

VII. Resource utilization-

A. R&D efforts to meet a qualified opportunity. Example, a 51% breaded product can be exported to Canada vs. a product with less than 50% breading.

B. Account Managers- Joint calls on corporate to further support the chains international expansions.

Distributor Managers- Joint calls in evaluating immediate opportunities extending across borders.
C. School Managers- Joint calls in US territories to expand and maximize product presence.

VIII. International Partnership Arrangements. Partnering/Joint Ventures with like businesses overseas. Some ideal targets are Japan, Australia, Mexico, China. Key defining terms…product novelty, business profitability, uniqueness, pricing, product demand, market distribution, language understanding, product understanding. If there is a commitment from an overseas manufacturer who understands the product/species, but lacks certain manufacturing capabilities, a partnership should be suggested.

A. Responsibility considerations :

o Raw Material Hedge

o Currency Hedge

o Brokerage Agreement

o Time lines

o Production Capacity

o Legal contract/Export Insurance

B. Partner’s Responsibilities:

o Volume Projections

o Co-Pack Agreement

o QA Plant Approval

o End User Presentations

o Stand-by Letter of Credit/Purchasing Contract

o Exclusivity

o Currency Hedge

o Other product opportunities

Notice currency hedge may fall under both and is open for negotiation. It depends on relationship’s strength. Many times it should be for the account of the partner. An exception may be made to consummate the deal, or as a long term service insuring a yearly contract renewal.

IX. Licensing- Often used as a barometer in evaluating potential opportunities and minimizing immediate risks.

A. Brand Licensing- What is the true value of a certain brand in an international market? Would be determined by the partner company in that country.

Example. What was the value of the Parkay brand in Canada? Became the second best Canadian margarine brand. Produced by Parmalat in Canada. Brand was licensed by ConAgra US.

B. Technology- Minimizes capital overseas investment, while transferring US production technology.

X. Mergers and Acquisitions- Up to this point a corporation may be supplying and evaluating their export potential. Simultaneously, it should be considering the business worthiness of certain key markets. Ultimately, it may consider investment in those markets.

A. Partnership/JV company may be ripe for buy-out.

B. Margin potential internationally warrants an acquisition for corporate diversification purposes.
C. Many similarities i.e., language, business culture, profitability, increased product demand from growing middle class, business supporting political environment.

D. Overcome stringent food import barriers i.e., EEC. Example- Companies have improved international exposure, opening manufacturing plants within the EEC. An example has been the recent purchase of Sara Lee European brands by Smithfield.

XI. Summary- These idea compilations are based on 20 years of international business experiences with four major corporations and an MA in International Business. No one size fits all. The outline can be used to build new profitable opportunities that may not otherwise have been realized or fully exploited.

RICHARD J. PORWIT has been an International Sales and Business Director with extensive food and CPG experience, including new product development, market growth, profit and loss accountability in retail, food service and business to business markets. Consistently known for exceeding set goals, division turn arounds, with cross-functional team leadership in customized product development. Recognized for ability to establish and expand international markets in Asia, Latin America/Caribbean, and the Middle East.

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Undergraduate Program: International Business Program

worldwide organisation Formation and common characteristics of worldwide business organizations
An worldwide business corporation or global enterprise business enterprise (IBC) can be regarded as an offshore organisation that has been formed beneath the laws of unique jurisdictions as a tax-free corporation which does not have the permission to have interaction in enterprise inside the jurisdiction it’s miles included.
The traits of worldwide enterprise business enterprise do vary from jurisdiction to jurisdiction. but, a few common traits of worldwide commercial enterprise groups are:
The international commercial enterprise corporations are exempted from nearby company taxation and stamp obligation, with the situation that, it should not interact into any nearby commercial enterprise. however, the expenses for the yearly agent and registration taxes are not blanketed in the exemption.
They assist in booking the confidentiality of the useful owner
The international business agencies do have company powers to have interaction in extraordinary organizations and activities
The global organizations can issue shares. That can be both in the registered or bearer form.
they have got a provisional region for a local registered agent
it could abrogate the requirement to illustrate company gain or appoint local directors or officers.
The procedure of an international corporation Formation entails the following steps:
Approval of business enterprise call
The approval of the call is step one within the putting in place of an worldwide organization. The Registrar of the agencies simplest approves the proposed name whilst it is not identical or nearly same to the call of any corporation that is already existing. on the subject of the call, the phrases like bank, insurance, and group are used most effective if the organization has a special requirement for that or capabilities mainly zone/sectors related to the ones.
If any existing has any trouble with the call of a new organisation, it is able to item the identical, however, within a span of six months.
Registered workplace
another necessary needful is the address of the company. The deal with that’s recorded in the organizations Registration office is the registered workplace of the global employer. this is a completely essential a part of agency formation as the reputable mails or correspondences need to be sent to the deal with that’s recorded as the registered workplace. Please notice that the registered office deal with can be distinct from the buying and selling workplace cope with.
inside the worldwide enterprise Formation, the shareholders and stockholders play a totally important element as they make investments into and maintain stocks in the belongings of the agency. they have additionally unique rights like vote casting at fashionable meetings of the employer.
If the company is making tremendous profit, they have got the proper to be presented a enormous dividend. If it is liquidated, they also can make claims to get returned the money they invested. what’s extra, the shareholders actually have the strength to put off the administrators of the enterprise.
legal and issued percentage capital
The authorized capital signifies the whole numbers of shares that may be issued among. This plays a key-position in the international business enterprise Formation as shares are allotted to one of a kind share holders that is referred to as the issued percentage capital of the employer.
Memorandum and Articles
The objectives are, major and subsidiary, are collectively known as the Memorandum of affiliation. It describes in a nutshell the name and the limited legal responsibility of the members of the enterprise. The internal operations and the control that sets the meetings and the quantity of directors for a quorum are governed by way of the Articles of association.
international agency offerings
employer or confined liability agency like Offshore Incorporation is installation outdoor the united states of america wherein the precise employer is already set. some examples are the Nevis LLC, British Island, Belize organisation and Panama IBC. The owner is given a economic confidentiality like, an offshore financial institution account, which additionally aids in supplying less complicated traceability to account holder.

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