How Do You Decide Where To Expand Internationally?

What are the four international strategies?

Local responsiveness is the degree to which the company must customize their products and methods to meet conditions in other countries.

The two dimensions result in four basic global business strategies: export, standardization, multidomestic, and transnational.

These are shown in the figure below..

What are five common international entry modes?

Core Principles of International MarketingInternational-Expansion Entry Modes.The Five Common International-Expansion Entry Modes.Exporting.Licensing and Franchising.Contract Manufacturing and Outsourcing.Partnerships and Strategic Alliances.Acquisitions.Foreign Direct Investment and Subsidiaries.More items…

What are the disadvantages of international business?

Here are a few of the disadvantages of international trade:Shipping Customs and Duties. International shipping companies like FedEx, UPS and DHL make it easy to ship packages almost anywhere in the world. … Language Barriers. … Cultural Differences. … Servicing Customers. … Returning Products. … Intellectual Property Theft.

What are the benefits of expanding internationally?

Advantages of International ExpansionEntry to new markets. … Access to local talent. … Increased business growth. … Stay ahead of the competition. … Regional centres. … Cost of establishing and termination of an entity. … Compliance risk. … Business practices and cultural barriers.More items…•

What is international expansion strategy?

International expansion strategies are formal, multi-level strategic plans that businesses use to enter an overseas market, establish a growing presence, and become quickly profitable. Foreign expansion strategies make growth more structured and sustainable.

What are three things you would do prior to doing business in a foreign country?

Before you do business internationally, you should prepare for those challenges, and decide to start working oversees when it works for you.Affordability. … Feasibility. … Communications. … Market. … Currency Exchange. … Problem-solving. … Customs and Boarder Operations. … Discounts.More items…

What are the three types of international strategy?

There are three main international strategies available: (1) multidomestic, (2) global, and (3) transnational (Figure 7.23 “International Strategy”).

What are the expansion strategies?

Some general growth strategies in business include market penetration, market expansion, product expansion, diversification and acquisition.

Why are so many companies choosing to expand internationally?

One of the reasons why businesses expand globally is to be able to provide a reliable service to their international clients. A good global reputation will attract new customers. Expanding abroad allows a company to build name brand recognition and establish credibility internationally.

What criteria should a company use to determine which countries it should expand into?

When pondering if international expansion is right for you, consider these four factors:Culture. The cultural difference can determine whether the business is successful or not. … Legal and regulatory barriers. … Foreign government consideration. … Business case.

Why do some companies choose not to go global?

Companies lack the size and the resources to go abroad. These companies may lack the resources for finding and managing overseas customers, partners, and suppliers. Some 15% feel international expansion is just too expensive to pursue.

What conditions help managers determine which type of distance is most likely to affect the success of an international expansion?

The conditions that determine what type of distance will impact the success of an international expansion include the country’s culture. differences impact the power distances that can impact the success of an international expansion.

What are the 5 international market entry strategies?

Market entry methodsExporting. Exporting is the direct sale of goods and / or services in another country. … Licensing. Licensing allows another company in your target country to use your property. … Franchising. … Joint venture. … Foreign direct investment. … Wholly owned subsidiary. … Piggybacking.

Is McDonalds multinational or transnational?

McDonalds is considered a multinational corporation or a transnational corporation. McDonalds has roughly 30,000 restaurants in 119 countries. Their coffee, which is used in their frappes comes from Brazil, Columbia, Guatemala, and Costa Rica. There are many advantages when it comes to McDonald’s international trading.

What are the 4 growth strategies?

There are four basic growth strategies you can employ to expand your business: market penetration, product development, market expansion and diversification.

Why do companies want to go global?

In general, companies go international because they want to grow or expand operations. The benefits of entering international markets include generating more revenue, competing for new sales, investment opportunities, diversifying, reducing costs and recruiting new talent.

How do you expand internationally?

THE TOP TEN DO’SConsider international trade as a growth opportunity.Investigate franchising for global expansion.Evaluate your competition’s international business.Develop a master international marketing plan.Dedicate personnel, a budget, and appropriate procedures.More items…

What factors to be considered before going international?

Going Global: 6 Factors to ConsiderTime Zones. Working across time zones can pose challenges when trying to schedule meetings or reviews. … Language. One of the most important things to keep in mind when you’re communicating with your client is that the language you speak may not be their first language. … Culture. … Legalities. … Payment. … Communication.