Meaning | The business where economic transactions are conducted within the geographical boundaries of one country. | The business where economic transactions are conducted across borders with several countries in the world. |
Nationality of Buyers and Sellers | Both buyers and sellers belong to the same country. It makes it easier for both parties to understand each other and enter into business deals. | Both buyers and sellers belong to different countries, which makes business dealings relatively difficult due to differences in their languages, attitudes, customs, etc. |
Nationality of other Stakeholders | Stakeholders(employees, suppliers, creditors, etc.,) are from one nation. | Stakeholders(employees, suppliers, creditors, etc.,) are from different nations. |
Mobility of Factors of Production | Degree of mobility of factors of production(land, labour, etc.) is more as compared to international business. | Degree of mobility of factors of production(land, labour, etc.) is less as compared to domestic business. |
Nature of Customers | Customers are homogeneous in their tastes, preferences, consumption patterns, and buying behaviour. | Customers are not homogeneous due to different socio-cultural backgrounds, tastes, fashions, languages, beliefs, customs, etc. |
Business Systems and Practices | Business systems and practices are homogeneous within a country. | Business systems and practices are less homogeneous as there is difference in development level, infrastructure, market facilities, etc. |
Political System and Risks | Domestic business firms are familiar with the political system of their country. As a result, they are in a better position to understand and predict its impact on business. | International business faces difficulties in understanding and coping with the different political systems of every country. |
Business Regulations and Policies | Rules, laws, or taxation policies of a single country prevail in domestic business. | Rules, laws, or taxation policies of various countries prevail in the case of international business. |
Currency used | Currency of the domestic country is used. | Currency of more than one country is used. |
Risk | It involves comparatively less degree of risk. | It involves a high degree of risk. |
Order Processing Time | There is a less time gap between order and supply of goods. | There is a wide time gap between order and supply of goods. |
Effect on Foreign Reserve | It has no effect on the foreign reserves of a country. | It has a direct impact on the foreign reserves of a country. |