As an owner of a visible business that is valued in the community, you are making a final decision regarding the international aspects of a business decision, and you decide to set up a table with the risks and weigh their relative importance against the rate of return you foresee. You also need to put a plan in place to overcome it. Two main considerations are central to the decision:
1. Would the government encourage a decision to expand?
2. How would it affect the reputation of the business?
Your assignment is to fill in the table and then provide a brief summary of your decision, highlighting the two above considerations. The following are instructions for completing the table:
A. Choose an industry with which you are familiar or have an interest.
B. For each risk type listed in the table, indicate with an X in the appropriate column whether the risk will affect them as an importer or an exporter.
C. Also, make an assumption of what type of business (large, medium, or small) you will be using for each risk type by marking L, M, or S in the column.
D. Using these factors, provide a brief answer on how to overcome the risk for the industry and the business.
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Risk
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Importer
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Exporter
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L/M/S
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How to Overcome It
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Economic conditions
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Fluctuations in industry
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Competition
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Technological change
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Change in preferences
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Costs and expenses
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Regulations
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Expropriation
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Interest rates
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Government monetary policy
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Government fiscal policy
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Internal and external wars
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Difference in culture and religion
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Ownership of factories and property
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Human resource restrictions
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Intellectual property
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Discrimination
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Red tape and corruption
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Blockage of funds or capital accounts
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Change in government
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