Analysis of International Business Context for AGRI FRESH Company

This essay provides an analysis of AGRI FRESH, a citrus grower based in Western Australia, and its international business context. The company, established in 2005, has expanded its operations globally, facing various risks such as commercial and credit risks. The essay highlights AGRI FRESH's business strategy, including its focus on developing, packing, and promoting products in international markets like Hong Kong, China, India, Britain, and France. It also discusses the company's commitment to water conservation. The analysis delves into the challenges of operating in uncertain international markets, including fluctuations in transportation costs, currency rates, and import duties. The essay emphasizes the importance of managing credit risk in international operations and the need for thorough risk assessment to mitigate potential financial impacts.

Running Head: INTERNATIONAL BUSINESS CONTEXT
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International business context
Essay

INTERNATIONAL BUSINESS CONTEXT 1
AGRI FRESH was established in 2005 which is being operated by a family. It functions mainly
in Western Australia on citrus grower and is located in Dandaragan. It is in the business of
transforming a new image to the country which was often recognized as the land of wheat and
sheep with the help of unique approach management along with high-tech instruments which are
highly capable (Agri fresh, 2019). At present, company is being recognized as one of the largest
citrus industry in whole Western Australia and is fully committed to their integrated business
strategy of developing, packing and promoting their products to their potential market on the
global platform by meeting all the present and future expectation. In addition to this, company
have extended their business reach from 2012 by introducing Summer gold orchard mangos
along with very advance packaging instruments which offer all kind of services right from color
to size control. The company is fully devoted towards offering high quality products to their
potential customers. Advance technology is offering two type of benefit to this company, one is
effective business operation and other is cost optimization. In addition the company is also
devoted to the water conservation in order to fulfill their duty towards welfare of the human
living in the community in which they are operating ((Agri fresh, 2019)). Company believes that
water conservation must be the first priority of the company who is operation in this kind of
business sector. AGRI FRESH has setup their business empire in most part of Asia: Hong Kong,
China, India and in Europe: Britain, France, Australia, New Zeland and so on. The company
have great hold on these two main region which contributes almost half revenue of the world
business.
In this uncertain international business, AGRI FRESH Company will have to face various risk
related to their business but two main risk which can impact their business are commercial risk
and Credit risk. Though commercial domestic business also comes under commercial risk but it
has great influence over international market. A minor change in international operation can
bring any kind of hazard to the whole company operation (Pasiouras, 2008). Even, sustainability
of product for longer time is not guaranteed because there is a huge variations in the demand of
the potential customer. Therefore it become very difficult to predict the mode of the business.
AGRI FRESH Company is very experienced firm in this business sector but still it will be
difficult for them to understand the real nature of foreign market as compared to their domestic
market. In addition there are various factors which through additional risk related to commercial

INTERNATIONAL BUSINESS CONTEXT 2
exchange like change in transportation cost, change in currency rate and change in import duties
(Li, 2012).
At present most of the business are run on credit base system and therefore AGRI FRESH
Company is always at risk related to this factor because credit risk is more in international
operations as compared to domestic operation because the importer is having high bargaining
power as compared to exporter (Diamond and Rajan, 2009). In international market, most of the
times exporter have no choice but have to provide the credit on the terms and condition which
are favourable to importers as compared to exporters. As insolvency rate is moving very high so
it will become very difficult for AGRI FRESH Company to keep balance related to payments
which can ultimately impact their overall business operation in terms of finance. International
operations are such kind of activities in which risk related to the credit cannot be avoided but can
only minimize by exploring every single detail which can be useful to the organization in this
situation (Weber, 2012).

INTERNATIONAL BUSINESS CONTEXT 3
References
AGRI FRESH. (2019). About us [online]. Available from: https://www.agrifresh.com.au/about-
us [Accessed 21/3/19].
AGRI FRESH. (2019). company information [online]. Available from:
http://apureholdings.net/agf/index.php/company-information/about-us [Accessed 21/3/19].
Diamond, D.W. and Rajan, R.G. (2009) The credit crisis: Conjectures about causes and
remedies. American Economic Review, 99(2), pp.606-10.
Li, W. (2012) Study on the Development of the International Trade Financing of the Commercial
Bank in China. Energy Procedia, 17, pp.573-579.
Pasiouras, F. (2008) Estimating the technical and scale efficiency of Greek commercial banks:
the impact of credit risk, off-balance sheet activities, and international operations. Research in
International Business and Finance, 22(3), pp.301-318.
Weber, O. (2012) Environmental credit risk management in banks and financial service
institutions. Business Strategy and the Environment, 21(4), pp.248-263.