Organizational Participants that
make international business
happen

What we will learn
 We will overview the participants in International Business
 Arranging those participants in value chain
 Focal firms in IB
 International entry strategies of focal firms
 Distribution channel intermediaries in IB
 Facilitators in IB
 Governments in IB

Recalling the Participants in IB from Chapter 1
MNE: A large company with substantial resources that performs various business
activities through a network of subsidiaries and affiliates located in multiple countries
SME: A Company with 500 or fewer employees (as defined in Canada & USA)
Born Global Firm: Young entrepreneurial company that initiates international
business activity very early in its evolution, moving rapidly into foreign markets
Governments & NGOs: Larger entities as compared to above 3 stated participants

Categories of Participants in IB
Focal Firm: Initiator of International Business who design, produce offerings for
intended consumption by customers
Distribution channel Intermediaries: Specialized firms who carry out
distribution of services and products for focal firms
Facilitators: firms with special expertise in banking, legal, customs, and related
services for assistance to focal firms
Governments: In this we refer to state owned enterprises

Putting these participants in Intl. Value Chain

Putting these participants in Intl. Value Chain

Gyro chip
(Switzerland)
Multi-touch
display cover
(China)
Memory
(Japan)
Hardware
(South Korea)
CPU (UK)
Steel Case
(Taiwan)
Internet compass
software (Japan)
Wireless
(Germany)
Audio
(USA)

Dell’s International Value Chain

 They are the most prominent players in international business.
they are:
 MNEs
 SMES
 Born Global Firms
Focal Firms

 Focal firms use below entry strategies to enter into international
market:
1. Licensor
2. Franchisor
3. Turnkey Contractors
4. Joint Ventures
5. Project based, non-equity venture partners
Foreign Market Entry strategies

 These intermediaries are providing services, including market research,
appointing local agents/commission reps, exhibiting products,
arranging local transport and clearing services etc.
1. Foreign distributor
2. Agents
3. Manufacturer representatives
4. Trading companies
5. Export management companies
6. Online intermediaries
Intermediaries based in foreign market

3rd category of participant are facilitators, independent individuals
or firms that assist internationalization and foreign operations of
focal firms. They include:
1. Banks
2. Trade lawyers
3. Freight forwarders
4. Custom brokers
5. Consultants
Governments:
1. Sovereign wealth fund (SWF)
Facilitators in International Business