Key Issues Facing a Smart Phone Company Venturing in to a Latin American Emerging Market and Business Advice to Retain the Market

 

Key Issues Facing a Smart Phone Company Venturing in to a Latin American Emerging Market and Business Advice to Retain the Market


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Introduction
	International organizations are companies that operate across national and continental boarders. Companies go international with an aim of benefiting from resources such as labor, technology, raw materials, and expertise among others. However, the major reason as to why most companies venture in to the international business arena is to increase their market share, make more sales and increase the company’s profits (HM Treasury 2004, p. 2). Mobile phone industries have been on the frontline to venture in to new markets to increase sales. However, venturing in to a new market brings opportunities to the business as well as challenges. This paper is an analysis of key issues facing a smart phone company venturing in to a Latin American emerging market and business advice to retain the market.
	Challenges that would face a company in an international arena can be classified in to two different categories, which are the internal and external challenges. The internal challenges are those challenges within the company that might hinder its success in the new Latin market. On the other hand, the external challenges are those that are not associated with the company, but are associated with the target market and affect the company’s success in the Latin market (Moehlman 2010, p. 32). 
 External Environment
	There are different external challenges, which exist in the Latin market, and have the ability to interfere with business operations. The study of all the external environment of the foreign country includes

Economic Challenge
Latin America is a fast-growing market for smart phone, which has attracted many companies. However, the economy of a target nation can pose a major challenge in the success of a company’s operations in the Latin market. For a business venturing in the international arena, the economy of the target nation is an essential factor to put in to consideration, this is because it determines the market price for the products, which directly translates to the amount of profit the business makes. The GDP of the Latin market is important because the growth of GDP simultaneously grows with economic development (Paul 2009, p. 2). The smart phone company targeting to go in to the Latin market must ensure that they have a great understanding of the market as the prices will be set based on the ability of the people to acquire the products. 
Political challenge
	Political situation of a target nation is an important aspect for the smart phone company venturing in international business to consider. This is mainly because the politicians are the lawmakers and the governments are involved in the drafting of policies governing international business operations (Cherunilam 2010, p. 13). The Latin market is a democrat that is ruled by the majority vote and most of the people in the government are involved in policymaking. However, there is a clear distinction between politics and the economy of the nation, which guarantees quiet working environment. In addition, when venturing in to a new country, it is important to note the international trade bodies, which the Latin country is a member, as this might have an effect of how the nation treats international business in terms of customs and tariffs. The government may be involved in the making of policies that determine the acceptance of international business and taxation, which will determine the profitability of the smart phone company in the Latin market. 
Legal
The legal aspect of venturing in to a new country includes governmental regulations during the establishment of enterprises (Thomas 2006, p. 12). This may pose a challenge to the smart phone company as it ventures in the Latin market. The company would need to understand the legal framework of the country as it aims at encouraging foreign investors into the country and in its capital industry (Jansson 2008, p. 12). A good example is, when the government expects that the products being produced by the company should be in line with the health and safety Act in their constitution. Thus, they should not be harmful to the citizens of the country.
Licenses and taxation
Getting the legal documentation and filing for the right taxation can poses a challenge to an organization venturing in an international business. Based on (Thomas, 2006 p.43), the tax policies of the Latin market are designed towards encouraging investments from multinational corporations. Investments from these corporations enables the country grow their GDP and therefore the country develops through provision of employment to the locals.
Cultural
Culture poses a challenge to organization is, when they try to venture in to a market without understanding the way of life for the people of the particular nation. The cu