Protectionism In International Business

By doing this company can easily increase their sales and growth. 7. “New competitive arenas”: Companies can fit in in different vertical to exploit some opportunities available in different sectors. And it’s also benefits to company because company also can use their skills. Zealong also can adept this strategies so company can increase their growth.

This may involve promotion of the product, creation of an extensive distribution process to reach a wider consumer area, and putting attractive pricing to lure more customers into purchasing the company’s products. Coming up with innovative ways of increasing the usage of the product will also, help a company improve its sales in an established market (Maria, Grandinetti, & Bernardo, 2012, p.

In the merged firm, abundant skills and technology being pooled together and brings innovation in products and services. Hence the combined company with their new products will reaches customers widely, bringing in the profits ultimately. (Different types of Mergers and Acquisitions (M&A),

Advancement in logistics capabilities allows H&M to better utilize inventories and reduce waste throughout their global supply chains. The change is driven by improved communication capabilities allowing greater and speedier diffusion of information within company. Improvements and changes in communication technologies also open different avenues through which to communicate with its customers and suppliers. The continued popularity of blogging, hauling and other forms of social interaction between customers or potential customers can act to attract customers or build customer loyalty. It also offers more marketing channels through which H&M can communicate with customers.

The company aimed also to benefiting from economies of scale. The cohesion between the structure of the company and the strategy applied is very crucial. The structure aligns the company with the strategy it wishes to implement, and along with the companies control systems and culture, will utilize the value-chain capabilities and competencies, and facilitate increased profitability, competitiveness and superior return on investment (Henderson, 1993). Procter and Gamble identified the rapid increase in globalization and changed their business strategy and the company’s structure in order to increase their exposure in many countries. This was to help it benefit from economies of scale and to remain competitive internationally.

International trade is also knows as a globe trade which give the country opportunity to expands their markets for both good and services that otherwise may not have been available in other countries. This type of trade also give advantages for world to rise the economy in term of prices, supply and customer demands, affect and are affected by global events. All of the good and services can be found on international market. International trade will involve two types of process which be export and import. Export is a function of international trade in which the goods produced in a country will be sent to another country for future sale or trade.

Product Development. McDonald’s uses product development as a supporting strategy for growth. In applying this growth strategy, McDonald’s develops new products over time, such as new McCafé products. These new products may be variations of existing products, or entirely new products. The strategic objective for this strategy is to capture more consumers by attracting them to new products.

But in a long-run, when trade barriers continue, trade barriers will hurt national economy. One problem that emerges from trade barriers is rent seeking. When local industries tried to lobby the government to give them subsidies or increasing tariff rates to gain more profit, there are no additional value added to the total output thus, there will be wasted resources used for lobbying. This is one example of the inefficiency of trade

However, as the economic, social, political situation of nations differ, they set up artificial barriers on trade to protect their own interest. These measurements include tariff barriers, import quotas or non-tariff barriers such as TBT (Technical Barriers to Trade) and SPS (Sanitary Barriers and Phytosanitary Measures. However, trade barriers are known to bring losses to consumer surplus as the trading market is artificially interrupted by government policies. Although keeping a high trade barrier

However, the company seeks to incorporate product discounts based on the quantities bought to increase demand for the product while enhancing market penetration (Bian & Forysthe, 2012). The developed strategies pertaining to product development and positioning influence the development of the company’s brand in the market thus creating a competitive advantage. Increased penetration into new markets provides the company with a competitive edge as it garners a larger customer base within the new markets such as the MENA