International business plan

Business : the following is an excerpt from cpa’s guide to developing effective business plans by tim berry, originally published by harcourt brace professional publishers, and reprinted and revised several times. Looked out the window of a parked plane, at a dark, drizzly airport in rio de janeiro. I was half a day from my starting point and still several hours from my eventual destination, buenos i looked into the dampness outside the plane, i worried about exactly the same subject as discussed in this chapter — business planning for the international company. Apple computer, which was then riding the height of its success in the late 1980s, had hired me to travel to argentina to instruct its local dealers on business not? I had lived in mexico, spoke fluent spanish, and had written books on business planning. As a consultant, i had helped apple develop its annual latin american business plan for four years running. I had also developed the specialized software apple dealers were using to do annual business i worried about, however, that particular morning at the airport, was exactly that same question: why not?

How about because i had never been in argentina, hadn’t studied their local tax laws and accounting practices, wasn’t ready to predict their volatile currency exchange rates, and didn’t know their standard business practices? Even though accounting practices and tax treatments may vary widely from country to country, the techniques of business planning are far more international than country-specific. In the following three years i gave business-planning seminars in eight different latin american countries, and five in asia for four different computer manufacturer sponsors. At each one, i dealt with a few dozen computer dealers who ran their small businesses in their local markets. As i presented business planning and we discussed the specifics of their markets and their businesses, the techniques held up. A good plan is essentially a good plan, or not, depending on a lot of factors besides tax treatments and accounting business, your client’s business: what’s different? Let’s assume you or your client are in the united states developing a business plan for an international business.

How different is that business plan from a business plan developed for a strictly domestic business? Exchange rates are the first thing that concerns most people as they consider an international-oriented business plan. Guess wrong, and you the larger international businesses, predicting and managing currency exchange can be critical. When i was consulting to apple japan in the early 1990s, chief financial officer judy david produced substantial profits, occasionally comparable to the profits from the computer business, with astute currency management. When i was with mckinsey management consulting in mexico city in 1981, i saw major companies lose millions of dollars when the peso devalued, catching them with assets in pesos and liabilities in mechanics in the critical as currency exchange may be in your business, its specific treatment in your business plan is not much different than how a wheat farmer would treat fluctuations in the market price of wheat. To understand that, you should first recognize that regardless of how international your business might be, you are still going to do your books and report your numbers to the tax authorities in a single currency. If you are based in the united states, your business plan should be in dollars.

It doesn’t matter how many countries you deal with, you still do your plan in dollars because you pay your taxes in where does the currency exchange come in? Some businesses buy products in foreign markets and bring them into the united states to sell. In all these cases, however, if you are based in the united states then you are still going to have to translate all your currencies into dollars for your plan, your accounting, and your s 1-2 show a simple example of how an import business handles its foreign currency costs in a start-up business plan, using liveplan premier sales forecast and user-added tables. In figure 1 the sales forecast consists of projections for unit sales, dollar revenues per unit sold, total dollar sales, dollar costs per unit sold, and of course total dollar costs of 1: the sales forecast consists of projections for unit sales, dollar revenues per unit sold, total dollar sales, dollar costs per unit sold, and total dollar costs of 2 shows a simple two-row table for handling the currency exchange rates in the liveplan user-added table. You can work this into your business plan with some simple formula mechanics:The formula for the first row in costs refers directly to the peso exchange rate in the user-added table. Even without the specific details, you can imagine how to handle a business in which currency rates affect expenses instead of costs of goods. In this case, for liveplan purposes, your expenses are included in the profit and loss table instead of the sales forecast table.

Accountants talk about costs as the cost of what you sell, and expenses are the operating expenses related to running the business. You would take your unit price estimate in the second block of the sales forecast table and create a formula calculating dollars from pesos much like your formula that calculates dollars for pesos in cy exchange: planning all of the examples above, the business plan mechanics are relatively simple. The thinking can be quite complex, and the significance of planning and forecasting is huge. Factors affecting a change in currency exchange include political factors, economic factors, market factors, even psychological an example, in the 1970s i was living in mexico and writing for business week magazine. To guess the timing of the devaluation that eventually took place, one had to guess the flow of dollars and pesos and political will as business plan in the example needs to deal with the possibility of changes in exchange rates affecting costs. The business plan mechanics are easy, but the related decisions are on and accounting from currency exchange, some international business plans must also deal with different tax and accounting practices. However, in business planning, you are looking ahead and planning business decisions, not reporting to tax authorities.

While you might use additional formulas to calculate your taxes, for planning purposes they are still going to be summarized in a single line towards the bottom of your profit and loss statement. Using liveplan, you could use the row in the cash flow worksheet to calculate the vat or other taxes in more detail, and then run the results over to the tax line in your profit and loss. Then you subtract interest and taxes to calculate net general, as you plan the international business there is more uncertainty than with the strictly-domestic business. Also, there are factors affected by when you translate your foreign currency elements into , sales, and problems of estimating your business numbers are relatively easy to understand. Maybe the government needs to focus its weaving industry on producing low-cost basic goods instead of export items for international markets. Local politics, national politics, and international politics can affect import and export policies, availability, and pricing. Since you are farther from the market, you can expect more trouble estimating future ation factors and timing of currencies fluctuate, the timing of your transactions can change your business.

The timing can make a difference to gh the business planning mechanics don’t change as a result, the information gathering for international business is more complex. When doing business in multiple countries, you also have to deal with multiple markets and market trends. This makes your business plan preparation harder, even if it doesn’t change the mechanics of business planning. If you are buying in central america, you need to know about market factors that could be affecting your ational planning is still preparing this chapter, i was struck by an irony related to planning the international business. Despite having lived in three countries, and worked in more than a dozen others, i had to remind myself first how planning an international business might be different. I had the privilege of doing the annual business plans for apple computer’s latin america group from 1984 to 1987, and for apple’s japan subsidiary from 1991 through 1994. I am from buenos aires and actually i am doing my first business plan for a start up project.

Found your statement very useful, but would be nice if you could elaborate more on advantages and disadvantages of choosing weak or strong explanation that can be very well understood even by a layman. Try these:International market ng for purchasing a olwyler on myths of small business ational market ng for purchasing a the #1 business planning software risk-free for 60 contract, no risk. Built for entrepreneurs like : the following is an excerpt from cpa’s guide to developing effective business plans by tim berry, originally published by harcourt brace professional publishers, and reprinted and revised several times. It is also called export business 1: analytical phase of international business is a very important stage of the preparatory period for entering an international market. Based on obtained information a company checks feasibility of continuing international business planning and makes first go-or-not-to-go 2: planning phase of international business is a final stage when a company puts together its foreign market entry plan and considers all steps that must be taken in order to succeed in international business. The typical content of international business plan is:Executive summary of international business ate global vision and ational business n market ational business this stage a company identifies the best strategy that will help it to enter each particular foreign market of interest. The examples of the international business strategies are exporting, licensing (franchising), joint venture, foreign direct investments, ational marketing plan.

Requirements depend on foreign market research, risk assessment and a selected international business t /service adaptation requirements;. Or trade ational business action on an international marketing plan and the project approach international business action plan contains activities, milestones, estimations, resources, performance measurement and evaluation and benefit a copy of international business plan? All rights western union business solutions learning center is a blog provided for general informational purposes only and should not be construed as legal, financial, tax  or accounting advice. Consult your own independent advisors regarding your particular needs and ng an international business customers to employees to logistics — a lot changes when a small business expands internationally. When a small business owner plans to tap into a foreign market, it’s important to adjust his or her business plan accordingly. Your core business goal may stay the same — to create more revenue,” says mark jackson, ceo of moreson conferencing, a global conference-calling company based in birmingham, ala. Are tips for revising a domestic business plan for an international measurable goals makes it easier to track progress and conduct periodic assessments of the expansion’s success.

Define your international business plan should include details about the target audience, existing competitors and size and scope of the industry. Based on this information, the plan should explain why this specific foreign market was chosen and why it is a good fit for the business, says todd colbeck, executive coach and principal for colbeck coaching group in may sound like a daunting task, but much of this information can be gleaned from preexisting market studies, interviews with potential customers and vendors, and data from state and government agencies, trade associations and research companies, he most small business owners, international expansion is often motivated by an inquiry by a potential customer or someone in their network, says harry g. Start with your end goal in a business owner knows what he or she wants to accomplish, it’s much easier to figure out all the steps required to get there, colbeck says. For example, if the business owner’s goal is to establish five distributor contracts, the steps could unfold as follows: identify potential distributors, set up training for those distributors and research the legal implications of foreign contracts. Owners should include information in their plans about specific clients or contacts who can help secure business in the foreign market. In addition, jackson suggests that business owners can also try talking to trade associations, asking u. Define your arrive at the true cost of business expansion overseas, a business owner must factor in shipping and distribution costs, taxes and tariffs, travel expenses, currency exchange costs, regulatory requirements, cultural differences and accommodations, and the time it will take for any international payments to be made, says danny markstein, managing director at markstein consulting, a corporate strategy and communications agency in birmingham, ala.

Business owners should rely on the help of a trusted online foreign exchange service that can provide the resources and expertise needed to decrease currency exchange costs and make budgeting more process of gathering this information and putting it into a formal business plan can help business owners think through the issues and obstacles they face as they expand their businesses into a foreign market, colbeck says. Even if you have a great plan, something will happen that you didn’t expect,” he says. Steps to understand customers in a foreign cultural differences to exchange rates, learn how to meet the needs of a foreign customer to develop a website for a foreign customer how to cater to an international customer base by creating an international e: 1usd = xx an ideal rate in mind?