Launching a Global Business Effort - Essay Example

In terms of the marketing aspect, the business plan also contains the key issues in connection with market identification in order to link the demand and marketing program for the product manufactured or service provided by the firm to its existing and potential customers across countries ("MoneyGlossary," n.d.). As mentioned, an entrepreneur should carefully consider the capital structure of the business in light of the substantial working capital requirement of global investment. With this, he/she should take into account the sources of finance to fund business operations.

For instance, he/she may opt for a global offering of the firm's stocks in order to raise capital. On the other hand, an entrepreneur may also consider issuing foreign bonds, the issuer is a foreigner in a particular domestic market, in the bond markets of various countries ("Investopedia, "n.d.). Given the advent of different financial instruments brought about by the rapid development in the global financial market, a global firm should take advantage of such financing tools not only for funding purposes but also to structure financing in line with the risk profile of the company and the industry.

An entrepreneur should also be mindful of the political situation and regulatory requirements, which a multinational company is confronting. Political factors present a significant risk to global firms such that the government of a country may change its policies for strict compliance of companies operating locally ("Investopedia," n.d.). 2. Explain the statement "For each benefit gained by regulation, there is a cost." This statement means that the implementation of any regulation, although it brings about desired benefits, entails cost.

For instance, on the part of those implementing the regulation, say the government or the management of a company, additional manpower or printing of new forms and setting up new facilities may be needed to ensure that people or employees are complying with the given rule (Stossel, 2001). Such necessitates the incurring of additional administrative costs to cover these activities. Furthermore, they would have to spend for the education or training of those affected by the regulation in order to make sure that information has been appropriately cascaded.

Indirect costs are also involved for the people or employees affected by the regulation being implemented. For example, they would have to fill out forms or form long queues which may hassle these people. Stossel (2001) also asserts that regulations distract the creative power of people since energy and resources are allocated for this purpose rather than on profitable undertakings. This does not mean though that implementing regulation is completely detrimental to the development of the society or the business.

It should be noted that prior to regulation execution, a cost-benefit analysis is conducted to ascertain that the benefits derived from implementing a regulation outweigh the costs to be incurred.