![]() ![]() This is another why a company would want to go international. Take global competitors head-on on their home turf Usually, your job as a marketer would be the stabilize your product portfolio as well as customer portfolio to make your business robust against seasonality and these uncertainties.Ĥ. This is another reason why a company should expand internationally. This protects the business from uncertainties. Reduce over dependence on any one marketĮach business should be diversified across products and also across the market segments that it targets. This companies can offer their technology products to a new customer, any where in the world, at no additional costs. This is pretty relevant to tech-based companies who can be easily classified as 'born-global' companies. ![]() The effects of economies of scale can be magnified when a larger base of customers come into the business. Some goods and commodities provide the company with great economies of scale opportunities. Achieve economies of scale with a larger customer base ![]() This is obviously minus the initial go-to-market cost of breaking into that international market.Ģ. An international market could have a higher purchasing power and, therefore, the same products can earn better profits in that market. This is an obvious reason for a lot of local companies to enter into an international markets. Explore markets with better profitability The primary reasons that companies opt to expand into foreign markets are to:ġ. While a global supply chain has its own vulnerabilities, which are usually beyond the control of the company (for example: the Tsunami in Japan), there are many reasons why a company would want to enter into international markets. Why should companies expand internationally?Ī truly multinational company is one which has a globalized supply chain spread across different parts of the world. Having an idea of the different modes of entry into international business will give you a head start in creating a solid international strategy for you business. In this article, I will share with you what are the different modes of entry into international business. Your business can opt for different modes of entry into international business based on the size of your business, your expansion strategies, the potential size, the demand of your chosen international market, the economic and the business environment of the overseas nation etc. When businesses grow successfully within their domestic markets, they attempt to expand their businesses into international markets, in an attempt to replicate its success in overseas markets. In order to develop a plan of action for how I am going to take this further, I started with a really basic research – What are the various modes of entry into the international business? Similarly, the company that I currently work for is trying to break into the middle-east with something that we are not sure of whether it will work well in there or not. Every multinational business was somewhere started as a local business and over the time has adopted different modes of entry into the international business. I have spent the last two weeks working on an international expansion strategy for one of the products that I head at my workplace. ![]()
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