The Importance of the International Business Environment

by Priti Ramjee; Updated September 26, 2017

The international business and trade environment is the backbone of global economy. Trade agreements to buying and selling goods and services internationally gives manufacturers in various countries the opportunity to expand beyond the domestic market. Trading across national borders increases sales, creates jobs, balances seasonal fluctuations and provides a variety of products and services. As the global economy continues to strengthen, international trade continues to be in demand.

Increases Sales

For some businesses, the drop in the value of the dollar increases business internationally. To capture the international market, businesses have launched Internet marketing campaigns and websites targeted at consumers in specific countries. The New York Times states that one company generated 10 percent of its business from Finland because of a positive review that was written on an Internet forum. The marketing campaigns showed an increase in sales almost exclusively because of foreign orders.

Creates Jobs

International business trade and investment agreements open markets worldwide while ensuring fair trade to expand economic growth and create jobs. U.S.-based multinational companies employ approximately 63 million workers both directly and through their supply chains, according to Business Roundtable, an association of leading U.S. chief executive officers. Job creation and sustained economic growth rely on competitive international markets in both foreign investments and exports.

Balances Seasonal Fluctuations

Seasonal swings of your domestic business can affect profits and stability. For example, if you sell winter clothing, your numbers are expected to drop during the spring and summer months. An international business environment creates opportunities to counteract the downturns of seasonal sales by allowing you to export to countries with opposite seasonal trends to help you maintain consistent production and profitability all year.

Increases Variety

With international trade the choice of products, services and quality expands beyond the domestic market. For example, mobile telephone equipment became available even in countries that did not manufacture the equipment. Success in the international business environment, with a product or service on the domestic market, encourages local competition and increases the choice of brands and a variety of goods and services available to consumers.

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