Companies Doing Business Overseas
Essay Preview: Companies Doing Business Overseas
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Was the companys experience positive, negative, or mixed?
One of the most well known companies that has done business overseas is McDonalds corporation. While this expansion worked well for the company in the beginning by 2002 the corporation was looking to close 175 stores overseas. (Webpro, 2002)
What legal or political barriers did the company have to overcome?
Each country has a different set of laws to govern the way in which companies may operate in there country, employee benefits and rights, how they can import products and export products, rules governing food produced and sold in there country. For example it is considered unethical to use animal fat, especially beef, for any products sold in India. (Express, 1996).
Political turmoil can cause issues within some countries also. If a countries political climate is unstable or becomes unstable it will adversely affect a companies business in a country. For example if suddenly there was an invasion of a country in which the company was situated this could cause problems for the company in the invaded country. Especially if the country that is the invading party is an enemy of the US.
What technological obstacles did the company encounter?
McDonalds has tended to stay in countries that are not as advanced in technology as the US is. The most prevalent issue that affects all the international franchises is the differences in shipping capabilities. Since not all countries are equal in there ability to transport supplies in an acceptable way.
What cultural or business differences did the company encounter?
One of the biggest cultural differences they ran into was in many countries certain types of well known foods would be unacceptable to the population. In many of the countries that McDonalds moved into did not accept certain meats, or the way certain ways some foods are pre-paired. One of the issues that came up was the use of animal extracts in there French Fries. This issue was in fact brought to the attention of Vikram Bakshi by a group of protestors on May 5th 1996. As a result of this information being published in a local Indian paper McDonalds outlets were attacked and damaged. As a result McDonalds responded saying that they had never claimed to sell vegetarian food but in fact provided information on all the food items they sold. (Express, 1996).
What problems did these differences create for the company?
Differences in culture, technology, business, and political differences affect the company in its everyday life. Each of these four issues are major factors in how McDonalds runs its restaurants from day to day. In many countries certain foods are not permitted. Certain types of oils, certain meats, and even some types of bread are not considered