Assignment 2: Dropbox Assignment
Credible Outside Research
Prepare a document based on credible research and course materials addressing the following:
* Discuss the four strategies firms can use when entering foreign markets.
Four Basic Strategies Adopted By Companies To Compete In The International Environment And Discuss Its Advantages And Disadvantages?Top of Form
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Joseph Russell answered
Globalization means that many businesses must find a way to expand their territories and their market share. There are several different strategies that they use to accomplish this. Each of the strategies has advantages and disadvantages. However, it must be noted that the strategies and the suitability for various business environments changes based on the particular business, and the industry in which it operates. In general, the four most common business strategies used are outlined as follows.
The first strategy involves foreign direct investment. Using a strategy, the company either purchases another company in a country different from where their headquarters are based. The advantages of foreign direct investment are that they already have local staff who will know the demands of the region in which they live. The disadvantage is that some laws and regulations discourage foreign ownership or investment. In addition, tax structures can be prohibitive.
The second strategy is to open up a satellite company that will directly compete with local companies. The advantage to this is that it often has fewer barriers than foreign direct investment. However, it is often costly in companies that are already established in the home country often have an advantage. They are familiar with their market and understand their needs better than the satellite company.
The third strategy is to partner with...