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Question: Discuss about theBusiness internationalizationfor Cultural Environment. Answer: Introduction This report analyses the major five factors influencing the selection of the entry mode for Starbucks into the markets of Croatia and Japan. The entry mode for a business internationalization defines the strategies which is used by the organization in order to successfully extend its business into the foreign markets. The factors analyzed in this report significantly influence this selection process of the organization (Wach, 2014). Cultural Environment The cultural environment of both Croatia and Japan allows foreign organizations to sell their products in the corresponding markets. The people living in the corresponding societies are generally interested in exploring new products and services along with new international brands. This in turn allows the cultural environment of both Croatia and Japan to be positive for the business expansion of Starbucks. The most recommended entry mode of Starbucks into the markets of Japan and Croatia would be to provide license to a local organization for an efficient joint venture between that company and Starbucks International. This licensed joint venture will allow the popular local organization to have good business in the corresponding markets (Beladi, 2016). Political and Legal Environments The political and legal environments of Japan and Croatia influence the entry mode for Starbucks to the corresponding markets. This factor of both the countries influences the entry mode of Starbucks in different ways. The legal environment along with the political condition of Japan causes the operation costs and exporting costs to be quite high. So, the entry mode for the markets of Japan would be recommended to be foreign direct investment instead of exporting. This in turn will require Starbucks to invest directly in the corresponding markets in Japan for its business operations. Whereas the operation costs and exporting costs for the markets in Croatia will be normal due to the existing political and legal conditions of the country. The import regulations and legislations in Croatia allows the foreign organizations to export materials with less costs and in a seamless manner. So, the entry mode for the markets of Croatia based on its political and legal conditions should be expo rting instead of foreign direct investment (Brem, 2017). Market Size The size of the market for Starbucks in Croatia and Japan is another significant factor affecting the entry mode of the organization into the corresponding markets. The markets for Starbucks in Japan has a lot of potential along with its huge size. This immensely large opportunity in the corresponding markets of Japan can yield a lot of value for the business processes of Starbucks if the organization choses the method of foreign direct investment for the expansion of its business into Japan. So, the entry mode for Starbucks into the markets of Japan should be the process of foreign direct investment. But the current amount of opportunities present in the markets of Croatia isnt enough for the process of foreign direct investment. But the organization can choose the entry mode of exporting for expanding its business into Croatia, which in turn allows the completion of the business expansion process with limited costs overhead (Lee, 2016). Production and Shipping Costs The production and shipping costs are another set of significant factors that influence the process of determining the entry mode for a market. The production costs in Japan is quite low as compared to the host country of Starbucks, which in turn allows the organization to have foreign direct investment and licensing along with joint venture to be the recommended mode of entry. But the export and import regulations along with costs in Japan are quite high, which in turn makes it inefficient to enter into the market with an exporting entry mode. But in case of Croatia, the costs of importing along with the regulations allow the organization to have minimal cost overhead, which in turn can be used as the entry mode for Starbucks. So, Starbucks can use the exporting entry model to expand its business into the markets of Croatia. The production of the required ingredients along with materials isnt very efficient in Croatia due to unavailability of certain resources along with skilled emp loyees (Rask, 2014). International Experience The international experience of the organization along with its exposure into various types of markets influences the decision of entry mode into a market to a significant extent. So, the entry mode of Starbucks into the markets of Japan should be joint venture along with foreign direct investments. The biggest reason for this recommendation is the limited experience of the management of Starbucks has with the references and buying behavior of the customers in the countries of East Asia, specifically Japan. So, the entry mode for Starbucks for the Japanese market should yield maximum value out of a joint venture with a local organization operating in the same industry (Wach, 2014). The local company supports the management of Starbucks to identify, anticipate and satisfy the needs of the customers efficiently. Croatia is a European country and Starbucks has enough experience of operating in various European countries. This in turn allows Starbucks to have an efficient business expans ion into the Croatian markets with the exporting entry mode along with the assumption of full control over the operations. This in turn allows Starbucks to yield maximum value from the business operations in the Croatian markets through export and effective control of all the business operations (Gubik, 2014). Conclusion The report analyzed the most important factors affecting the process of deciding the entry mode for the business expansion of Starbucks into the Japanese and Croatian markets. The analysis of these factors revealed the best entry mode for the Japanese markets to be foreign direct investment along with joint venture. The report also identified the exporting entry mode to be the most suitable for the expansion of Starbucks into the Croatian markets (Apetrei, 2015). References Apetrei, A., Kureshi, N.I. and Horodnic, I.A., 2015. When culture shapes international business.Journal of Business Research,68(7), pp.1519-1521. Beladi, H., Dutta, M. and Kar, S., 2016. FDI and Business Internationalization of the Unorganized Sector: Evidence from Indian Manufacturing.World Development,83, pp.340-349. Brem, A. and Viardot, E., 2017. Revolution of Innovation Management: Internationalization and Business Models. InRevolution of Innovation Management (pp. 1-13). Palgrave Macmillan UK. Gubik, A.S. and Wach, K. eds., 2014.International Entrepreneurship and Corporate Growth in Visegrad Countries. University of Miskolc. Lee, W.S., Kim, I. and Moon, J., 2016. Determinants of restaurant internationalization: an upper echelons theory perspective.International Journal of Contemporary Hospitality Management,28(12). Rask, M., 2014. Internationalization through business model innovation: In search of relevant design dimensions and elements.Journal of International Entrepreneurship,12(2), pp.146-161. Wach, K., 2014. The Role of Knowledge in the Internationalisation Process: An Empirical Investigation among Polish Businesses.International Competitiveness in Visegrad Countries: Macro and Micro Perspectives, pp.143-158. Wach, K., 2014. Theoretical Framework of the Firm-Level Internationalisation in Business Studies.Patterns of Business Internationalisation in Visegrad Countries: In Serach for Regional Specifics, pp.13-30.