12 Importance of International (Global) Business

Importance of International Business

Going global a company can enjoy a lot of benefits. International business is a fact that helped companies to earn profits not only at the national level but globally. There is various importance as so companies opt for international business.

The benefits of international business are not only for the companies rather it is for also customers and the economy of a nation. The main importance of international business are mentioned below:

Global Opportunities

Global business provides global opportunities to business organizations. When companies are in domestic business they are bound to operate within the prescribed territory. But when they enter into a global business the area is high so is the market.

The international market provides access to diversified customers, their diversified taste, preferences, need, and wants are the opportunities for the companies.

Increased Revenue

In international business, one thing is clear companies involve in such businesses for earning more profits. And, the international market is a place of uncountable customers, simply the more the customers, the more the sales are, hence the more revenue for the company.

Market Expansion

Just look at multinational companies such as Coca-Cola, Apple, Microsoft, etc. how they had expanded their market all over the world? The answer is through international business.

International business opens the border for the companies to go internationally. Companies get a chance to explore and expand their stake in the new market and place. And, when the company meets a new market’s expectations the market shares of the company increase.

Quality Product

Have you heard of quality war or price war? International business promotes it.

The global business flooded a particular market with a variety of substitute products. When there are too many products people want to have quality products at low prices otherwise they easily shift to the next product.

This causes companies whether to provide quality products or reduce the price so that customers will prefer them. If not company can’t survive in the global market.

Global Image

To become a global image and brand, most companies reason to enter into international commerce. It helps them to become a global brand but depends upon them how they have served the foreign nations. Microsoft, Coca-Cola, Sony, Apple, etc. are examples of the global image.

Economies of Scale

The global business also helps companies to achieve economies of scale. Due to global business companies require to produce products at a very large scale since customers also are of very large size. The increased production helps to get economies of scale by reducing per-unit costs as fixed cost remains the same.

Earning Foreign Money

It is very fact that companies involved in global business mainly participate in exporting goods or services they produce. Exporting is the basic means to earn foreign currency.

By doing so foreign countries’ members make their payment in their currency which is foreign to the domestic country. And, the domestic country may further use such currencies to import different products and it helps to reduce the cost of conversion of currencies.

Cost Advantage

One of the most popular benefits of international business is that it helps companies to get a cost advantage. Due to international business, most foreign nations maintain their production in a nation where production and labor cost is low, its best example is China and India.

It is because their labor cost is low. It helps companies to produce products the competitors are producing but at lower costs and they enjoy increased profits selling competitively.


By doing international business companies also build networks with different foreign companies. Building positive networks with them helps companies to maintain healthy international relations.

Governments are the best example of healthy international relations. Due to this, the movement of international products is possible from country to country. When a company’s network is strong it also promotes different foreign investment projects.

Economic Development

A nation’s economy is called strong when it exports more than imports or produce enough itself. In this business, most companies export their products which helps to earn foreign currencies, increases profits, pays taxes, increases employment opportunities, people’s standards improve, and ultimately they all add to the economy of the nation.

Government Support

The international business operates in a free-market economy. Meaning that government has no direct right to stop global trade but rather government facilities and regulates.

The companies that are doing well are also subsidized by the government in terms of reduced tax, financial support, reduced tariffs charges, etc.

Employment Opportunities

Last but not least, the importance of international business is that it also provides various employment opportunities. Just, when FDI enters a nation, the nation’s public enjoys job opportunities. When a business wants to expand at a global level, it requires different talents, and job opportunity generates.

In addition, it avails the quality talents. When a company does not find domestic quality talent it can also easily outsource quality talents from a foreign country and vice versa.

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