They also go global in order to meet customer needs and to become more competitive. Global companies are those that have a global market presence, supply-chain infrastructure, capital base, and corporate mind-set. The global market is not an
After going through internet, I had this to quote. www.loc.gov/rr/business/BERA/issue1/trends.htm... As the economy grows slowly at home, your business may have to look at selling internationally to remain profitable. Before examining foreign markets, you have to be aware of the major trends in international business so you can take advantage of those that might favor your company. International markets are evolving rapidly, and you can take advantage of the changing environment to create a niche for your company. Growing Emerging Markets Developing countries will see the highest economic growth as they come closer to the standards of living of the developed world.
How does the globalization influence the international business? Globalization is primarily an economic phenomenon, involving the increasing interaction of national economic system through the growth in international trade, investment and capital flows. A rapid increase in cross-border social, cultural and technological exchange is part of this globalization phenomenon. Globalization has impacted the present world in numerous ways. These are: reduction of trade barriers permitting free flow of capital and services across national frontiers; creation of environment conducive to free flow of capital; formation scenario allowing free flow of technology among nation states; and development thrust in which free movement of labour can take place
A growing international presence will, therefore, can make it easier in the future to continue expansion opportunities this is because of the increase brand recognition. This will helps a business to be able to employ staff locally. 3. Sales will definitely increase when more customer are introduced to business: - it is rather simple to recruit an international sale force these days. From freelancers to distributorship to the web, marketing can happen at local level better than ever before in almost every part of the world.
The major advantage of globalization in the context of economy and businesses are firstly cheaper production costs and secondly more consumers or a wider market. Let’s discuss cheaper production costs first, big and even small businesses go to popular destinations like China, India, Brazil, Mexico and eastern European countries. Increased profit is a direct result of lower production costs. This helps businesses gain competitive edge over their counterparts. Secondly, more consumers are available when a business sells its products or services worldwide; this again leads to higher profits.
' The integration of the workforce in developing countries into global system of production is already raising living standards, improving working conditions and creating more jobs in those countries. ' '(Samuel J. Palmisano,2006:133) Another advantage, from businesses perspective, is that companies have now access to larger markets and therefore to can sell their products to other countries. That means more chances to make profit and win a place in the global market. Furthermore, enterprises have the opportunity through globalization to search for sources with cheap raw material, which leads to cheaper labor. This is also called also outsourcing, and is the most common step for many companies.
In the initial stage of internationalization, the allocation decision is made using the framework of domestic market, then base on the current market potential in the next stage, meanwhile the companies have to notice the cross-nation resource deployment to avoid duplication of effort. The need of efficiency in the last phase of globalization urges firms to deploy their resources rationally and in a balanced way to seize the opportunities and ensure the growth as well as the maturation of the company. Challenges of strategic planning When a company operate a subsidiary in a foreign country, the conflict between economic imperative - which determines where the elements of the business should locate, and political imperative - which is create by the demand of the host country, could emerges. Economic imperative Base on the economic factors, companies have two distinct strategic options when operating in an industry: Global strategy or country-centered strategy. The choice can be made by determining the proportion of product value added in upstream or downstream of the value chain, as well as the company's competitive segment in the value
Introduction Can selling be globalized?, if we ask manager of any organization , he would probably reply in a highly convinced manner saying that the global account management is both inevitable and desirable for any company. However, companies should have a clear understanding of the term, and should think intensely before jumping on the global customer bandwagon as building such relationship can bring hassles and troubles for the company. In many cases, it has been found that companies opting for globalized sales found them trapped as unanticipated costs outweigh the benefits, with major threat coming from downward pressure on price level as consolidated sales triggered request for greater volume discounts, and also increased sales commissions,
6 FACTORS AFFECTING THE DECISION TO “GO INTERNATIONAL” FOR BUSINESSES Motives for Going International Businesses consider expanding globally for multiple reasons as internationalization has been a prospective goal nearly every business is aiming for. In fact, there is a large international interest in this subject among researchers and practitioners in international business and executive management. In this article I focus on the main factors which are likely to influence business decision makers in practice and help to offer a broad overview of the topic. I consider the main theoretical explanations, which offer a more comprehensive rationale for the decision to go international. First, I distinguish between the main factors and the
2. Discuss different levels of market involvement and various modes of entry. Most of the companies start by producing and marketing in their own country. It is because the environment in the home country is better known thus the difficulties in the home country can be over come easily. But over time as the home market become saturated or in other words the market potential is fully occupied due to other players in a particular industry, a company seeks market elsewhere.