Going International
With the rapid globalization of the world, much and more businesses atomic number 18 trying to sell their products across borders. There are many ways in which a business may plan to start its business internationally. This paper forget plow some of those strategies like exporting, outsourcing, licensing or opening a subsidiary. It will also discuss the benefits of each dodging and what factors should firms consider in advance come in the alien market.
One of the most common ways of entering into a market is through exporting. The biggest benefit of entering through this strategy is that it limits the losses. The maximum amount a come with can lose is the startup costs and the value of the products in transaction. It allows the company to first test the viability of the foreign market by selling a small amount of its product. Gradually, it can maturation its sales as it gains more experience and information close the market. For example, when Honda initially entered America, it was through exporting their heavy motorcycles. Gradually, it got market information that there is more demand for its sparkle motorcycles. Hence, it started exporting lighter motorcycles. (Ball, 2006)
There has also been a trend towards outsourcing in the novel years.
Outsourcing refers to hiring labor and supplies from other parts of the world at a cheaper rate. The advances in telecommunicating and internet take reduced communication costs, which in return have allowed many companies to hire commonwealth from India and China at lower rates. The key benefit of this strategy is that it reduces the costs of the company significantly. (Daft, 2011)
Another way to enter foreign markets is through licensing. Under this strategy, the company (licensor) allows its intellectual property rights to be used by another company (licensee), based in the foreign market it is looking to enter, for a fee. The licensor doesnt have any managerial and...If you want to get a near essay, order it on our website: Ordercustompaper.com
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