Becoming familiar with the international business, its laws, customs, and culture is as important as calculating the costs, revenue, and profits of a planned expansion. You should know these factors impact the international business.
The first factor is that the parties must deals with the laws, policies and political authorities of more than one nation. These laws and policies may be inconsistent, or even opposed. Such as arbitration clauses, specification of the governing laws, and tax.
The second factor is the presence of different currencies. Different currencies give rise to two problems. Since the relative value of different currencies varies over time, the actual value of the prices or payments set by contract may vary, and result in unexpected losses or gains. So business deals will often depend upon the willingness of governments to make currency available.
The third factor is governmental authorities. Governments often play a much larger role in foreign business. In some countries, the government controls more aspects of daily life than in others. While the common usage treats totalitarian and authoritarian as synonyms, there is a distinct difference. For the purpose of this discussion, the main relevant difference is in ideology. Government-owned businesses may have different goals from private companies.
The fourth is international ventures are vulnerable to sudden and drastic changes in their circumstances. For example, war or revolution, changes in government, or currency devaluation have an impact on international businesses. Besides, be aware of the risk of changing tax rule interpretations in emerging markets. In emerging countries, the tax laws themselves may not change, but the interpretation and enforcement often do.
Lastly, some other factors are also impact, strikes, rioting broke out, food stuffs were seized from private companies.
