International Business And Trade

Importance of Business Alliances



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International business can cover a whole host of businesses and partners.  You are operating across international lines and frequently dealing with other cultures, currencies, and legal situations. This is true no matter if you are selling goods and services or working in bringing people from the other country into your country as tourists.  Thus it becomes advantageous to for strategic alliances with people and businesses in all the countries in which you hope to operate.  What is a strategic alliance?

A strategic alliance is a merging or working together of businesses for mutual gain.  It goes all the way back in history to when government started signing treaties to protect their borders and interests, a good example is during World War 2 when there were the Allied powers and the Axis Powers.  Those were military strategic alliances for getting rid of the opposition and strengthening your borders while decreasing your expenses.  When conducting business across borders a strategic alliance can help open international markets.  How?

One way is that the businesses with which you ally yourself should better understand the people in the country, and that will make it easier to sell your product and protect your interests.  For instance names and words have power, especially in marketing.  A lawyer advertising in England would never say something like "Let us help you get out of that bum rap" as bum there means Ass"  Selling products can mean you need to shift names and phrases, a strategic alliance will help with this.

Your new partner, and that is really what a strategic alliance is, developing beneficial partnerships, will have connections and understand the legal ins and outs.  This can be a big advantage!  British liability laws are vastly different from American and then throw in the European Market rules and you can make costly mistakes that can cost you that international market.  This can be extremely important when dealing with tourists and advertising overseas!

The advantages of developing strategic alliances when conducting business in international markets are numerous and these are just the main ones.  Better understanding of the culture, better marketing and advertising and avoiding legal problems are important in any business.  The better question would be are there any disadvantages to forming strategic alliances with business when working on an international basis?  The answer is none if they are truly strategic!

More about this author: James Johnson

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