Risks in International Business

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  • Topic: Risk, Finance, Market risk
  • Pages : 4 (1100 words )
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  • Published : May 30, 2013
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IBM 530
RISK IN INTERNATIONAL BUSINESS.
GROUP ASSIGNMENT.

PREPARED BY :
NURUL SYAZWANI BINTI BADIOZAMAN
SYAMIMI BINTI MOHAMMAD NAWAWI
SHAKIRAH BINTI MD YUSOFF
SITI SARAH BINTI KHALID
NOOR KHALIDA BINTI ISMAIL
( BM224 – OPERATION MANAGEMENT )

PREPARED FOR :
TN HJ MOHD SUKOR BIN MD YUSOFF

Risks In International Business .

International business manager must be fully aware of all the risk involved by conducting due diligence and risk assessment before venturing into international markets. Sometimes other invisible factor such as having proper connections comes into play, and which will contribute to the risks in conducting a business internationally. Some of risk in international business is Business risk, Economic risk, Political and legal risk, Cultural risk.

1.1 Business Risks
A firm’s potential loss or failure from poorly developed or poorly executed business strategies, tactics or procedures. It’s because of less than optimal formulation and implementation of strategies, tactics or procedures. Such as partnering selections, market entry timing, pricing, product features, and promotional themes. Business risks implies uncertainty in profits or danger of loss and the events that could pose a risk due to some unforeseen events in future, which causes business to fail. For example, an owner of a business may face different risks like in production, risks due to irregular supply of raw materials, machinery breakdown, labour unrest. In marketing, risks may arise due to different market price fluctuations, changing trends and fashions, error in sales forecasting. In addition, there may be loss of assets of the firm due to fire, flood, earthquakes, riots or war and political unrest which may cause unwanted interruptions in the business operations. Thus business risks may take place in different forms depending upon the nature and size of the business. Business risks can be classified by the influence...
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