The Cultural Challenges of Doing Business Overseas
In today’s business world, many businesses face diverse cultural challenges when entering the global business market. Steve Kafka, an American of Czech origin and a franchisor for Chicago Style Pizza is no exception to the rule. Contemplating expanding his franchise into Czech Republic, Kafka will need to address the cultural differences between the U.S and the Czech Republic, any trade barriers that he may encounter with his business expansion, identifying Czech Republic comparative advantages and using these advantages to his benefits.
According to U.S. Commercial Service (2007), “The Czech retail sector is undergoing a transformation as rising income and changing preferences create new consumer habits. Czech entrepreneurs looking to take advantage of these trends are increasingly turning to franchising.” Furthermore, studies show that the majority of new businesses fail. But franchise businesses experience a success rate that is six times greater which leads to greater security and more profits. With a high success rates for franchise businesses in Czech, Kafka is in a good position to expand his pizza franchise. However, the cultural differences between the Czech Republic and the United States could present business risk factors if not addressed properly.
There are many similarities of business cultures between the U.S. and Czech Republic. Nevertheless, there are differences that Steve Kafka would need to take into consideration. Gorrill (2007) stated that “Indirect communication – one of the most underlying and inherent features of the Czech culture is their polite and humble approach to life. Czechs are both formal and indirect in their ...