Question

Create an idea for your own MNC to conduct international business. Your idea should be simplified to the degree that you could possibly implement it someday. However, your idea should also be sufficiently creative to be successful if done properly. Your idea should focus on one country and one foreign currency, since many MNCs are focused in this manner when they are first created. So that you can recognize the issues regarding exchange rate risk that are discussed throughout this text, you should assume that you will receive foreign currency when selling your product. Your idea should be for a small MNC instead of a large MNC because even most large MNCs began as small firms. The following questions will help you define your MNC idea:

1. What is the product that you plan to sell?
2. What foreign country do you plan to target?
3. How will you sell the product in that country? (i.e., through a distributor? by mail?)
4. Is there some evidence that consumers in that country would buy this type of product?
5. Do you need to purchase supplies or to hire labor?

Answer 1

International business refers to the trade of goods, services, technology, capital and/or knowledge across national borders and at a global or transnational scale.

It involves cross-border transactions of goods and services between two or more countries.

Product to sell

Apparel/ jewelry designing
Apparel and jewellery designing is an excellent home-based business for women. A home-based apparel or jewellery business involves the designing or creation and sales of apparel or jewellery from home. Entrepreneurs who can design, manufacture and sell apparel or jewellery from their homes are highly successful – as the investment and operating cost is significantly lower when compared to traditional retailers. To establish a successful apparel or jewellery home-based business, good design skills and a passion for fashion are the only requirements.

Additionally, good marketing skills, both online and offline help as more and more apparel and jewellery are being sold online through social media and other online marketplaces. The advent of websites like Flipkart and Snapdeal have now made the selling of apparel and jewellery online a breeze for entrepreneurs.

Foreign country to target

The culture, religion and law of each country are extremely important to consider here. Some countries are very conservative in comparison.

In above case I would consider countries in Asia.

As jewellery consumption is high in Asian women as compared to other countries. So targeting Asian countries initially can be a good move.

How to sell the product in that country

Look for distributors capable of developing markets, rather than those with a few obvious customer contacts. The choice of distributors and the terms of the relationships should serve the multinational’s long-term goals.

I'll look out for a chain distributor, one who is residing in my country and has contacts in my other target countries.

The one who being locally has customer contact in my target countries.

Evidence for customer purchase

No market or country can give us any full proof plan to sell our products, it all starts slowly and gradually.

Market research with the help of proper local distributors is very important and crucial step. We need to recognize market likes and dislikes and are we able to cope up with it.

Recognizing market needs and to provide the correct product is the actual evidence.

Purchase supplies or to hire labor

Hiring labour can be a cost effective factor in my situation, as the labour cost is much cheaper.

Both the criteria changes as per location and market, choosing the cost effective and market availability can be a correct choose.

Above are the details of a new MNC startup as per my knowledge and information.