Variety in the Internationalization of Services

1. Variety in the Internationalization of Services Hoàng Thị Thanh Loan BAIU09085 Nguyễn Hoàng Linh BAIU09041 Bùi Nữ Yến Ngọc BAIU09109 Nguyễn Minh Trang BAIU09069 Nguyễn Vũ Phương Thy BAIU09133

2. Internationalization of Retailing: • The largest retail companies have been more conservative than other tradable services when entering foreign markets. • Only a few of the world’s largest retailers can be considered truly global operators: Wal-Mart(USA), Ahold (Netherlands), Metro (Germany)…

3. Wal-Mart • Remained a domestic US company until as late as 1991 when it opened a Sam’s Club near Mexico city Sam’s Club • Base on the value of its annual sales, if it were a country, would rank 26th in the world, ahead of Indonesia, Denmark and South Africa.

4. Table 11.4 Wal-Mart stores

5. The company is expected to concentrate increasingly on joint ventures since it was forced to pull out of Germany in 2006. • Wal-Mart sold its 85 German stores to Metro after it failed to repeat the extraordinary success it had achieved in the USA. • Wal-Mart’s sales strategy: • Allows the company to minimize extensive advertising and promotional campaign. • Maintaining low prices

7. Large global retailers are extending their market into Latin America, East Asia, central and eastern Europe

8. Large global retailers are extending their market into Latin America, East Asia, central and eastern Europe • Large retailers are internationalizing their supply networks in form of buyer-driven commodity chain

9. Large global retailers are extending their market into Latin America, East Asia, central and eastern Europe • Large retailers are internationalizing their supply networks in form of buyer-driven commodity chain => trade-led industrialization in labor intensive and consumer goods industries

10. 5 practices applied to buyer-driven commodity chain of large retailers • Global stimuli • Increasing incomes • Technology development, E-shopping centralized procurement using one distribution center

11. International Tourism Globalization of the world economy  Globalization of the tourist industry

15. Negative Positive Create jobs Sustain indigenous lifestyles, regional cultures, arts, crafts Provide incentives for wildlife preservation, environmental protection and the conservation of historic buildings and sites • seasonal • Adulterate and debase indigenous cultures, degrade traditional lifestyles • Create pollution and environmental degradation

16.  The idea of “ecotourism”: Self-determination, authenticity, social harmony, preserving the existing environment, small-scale of development and greater use of local techniques, materials and architectural styles.

17. Internationalization of Finance Factors for Reinforcement of Globalization of Financial Services E-finance Offshore banking centers

18. Factors for Reinforcement of Globalization of Financial Services • Information and telecommunications technologies  reduced transactions and transmission costs • Institutionalization of savings in the developed countries  large pool of capital. • Trend toward disintermediation • The deregulation of financial markets

19. In the LDCs, the share of FDI stock in service high is > 20%. • In the banking, cross-border mergers and acquisitions (M&As), means of foreign entry into LDC market during 1990s, rose to nearly 80mil.

20. Vietnam • Banking sector in Vietnam’s growth: Increase in penetration of foreign insurers + Improvement in services offered by domestic banks. • The country’s banking and financial services sector is developing at twice the rate of GDP growth ( Growing consumer demand + Increased internationalization of the banking system.) Vietnam’s banking sector is transforming and ongoing deregulation will fuel the sector’s growth in coming years.

21. Large increase in the presence of banks in less developed countries: East Asia , Latin America , Eastern Europe. • 1/3 of the world’s financial TNCs are from less developed countries. • NICs have begun to develop relatively large and aggressive banks with an increasing interest in international opportunities.

22. The effects of rapid spread of e-finance are not only in DCs but also in LDCs to leapfrog ahead in some areas of finance. • LDCs use e-finance leapfrog ahead in some areas of finance • The majority of the foreign exchange transactions are still made in only 3 currencies: the Euro, US Dollar, and Japanese Yen.

23. The need for secrecy + The desire for shelter from taxation and regulation  The emergence of offshore banking centers, which are mostly located in the LDCs. • Five major specialized offshore banking centers: The Caribbean, Europe, Middle East, East and South Asia, South Pacific. • Reasons: • less regulated than financial centres elsewhere. • low- or no tax settings for savings • provide discreet markets

24. International of Business Services BPO In general In India

25. Outsourcing: software development, research and development and engineering services. • The DCs (developed countries) outsource to LDCs (less developed countries) Benefits: • much less cost than their US counterparts • Had necessary skills • Speed and attention to detailed to perform the work

26. EX: • outsource data centre management functions • Network management functions • Business process and help functions  Small or large companies

27. India • Infosys Technologies • Tata Consultant Services • Wipro

28. 2/3 of India’s export of software services go to the United States. • Plays important role in creating jobs. • Has recorded high growth rates inn the export of services • software, business, financial and communication services.

29. Main concerns: • Growing demand for skilled workers • Rising costs • Competition Strengths: • Companies in DCs are increasing outsourcing to LDCs (India,…) • Have their own development teams to take sole responsibility for the development of certain service products. • The development of Internet

30. References • www.wikipedia.com • www.VietFinanceNews.com

31. Thank you for your attention!