When a company decides to take their business international, there are many different sociological and economic factors that they need to take into account. There are differences in management styles, international laws and treaties that regulate international business, as well as cultural customs that come into play. Each of these are significant and needs to be taken into account in order to minimize potential problems. Many times, lack of knowledge can create serious problems. Although there are a myriad of socio- and economic factors, this paper will focus on three key ones: 1) political barriers; 2) labor practices; and 3) cultural barriers. Additionally, real world examples will be offered on how some businesses have successfully overcome these barriers.Political Barriers For purposes of this discussion, political barriers refer to the geo-political situation of a country, as well legal barriers such as tariffs, taxes, etc. Countries set up barriers to foreign entities conducting business within their borders (especially imports and exports) for several reasons. Duties and taxes can create some government revenue. If there is a high tariff then there will be less exporting, therefore more of that product in the country, thus making the price of that product in the country lower since there will be a greater supply. So trade barriers can be helpful to a country. On the contrary, trade barriers can have a negative effect on a country as well. Consumers will have to pay a higher price on imports, and for similar products produced in the country the price will rise due to consumers buying the imported products. In order to regulate the barriers on international trade, there have been organizations formed. GATT (General Agreement on Tariffs and Trade), WTO (World Trade Organization) and NAFTA (North American Free Trade Agreement) are just a few examples (Czinkota, 1999). Other considerations in overcoming political ba...
