You are the CEO of XYZ manufacturing company. You have decided that you would li

Question

You are the CEO of XYZ manufacturing company. You have decided that you would like to market your product to Turkey. Consider the following points in your essay; you can make assumptions, but support your work with facts and scholarly references.

1. Discuss the reasons why your company would want to expand overseas, including why international business differs from domestic business. ? Discuss what your mode of international business would be and how moving abroad will expand sales.

2. How will you minimize risks and acquire resources? Write an essay incorporating the external influences that impact business.

You should address each facet illustrated below.

Explanation / Answer

The company will want to expand its market overseas for the benefits it brings which are as follows:

- increase in sales with new markets- after a period of time the customers and markets in the same location limit. For increasing sales discovering and expanding of new markets become an essential step. Globalisation helps us to identify these new markets for sales growth.

- Supports in diversification- expansion of new places helps the company to diversify its assets which can further help in protecting the company from the unforeseen adverse events of the market. Loss or downfall of business in one market can be adjusted and supported by the profits from another market. Also, new products can be introduced based on the cultures, tastes, and demands of the new markets.

- discovering new talents- setting up business internationally can help in accessing new talents which might be missing in the business. New and innovative ways of handling business and increasing sales can be attained from the labor of different places. Their ideas, experience, language skills etc can be a helpful tool for the business.

- gaining a competitive advantage- expansion of business globally helps to survive in the competitive environment. The market environment of different places can be different. Hence expanding the business in a new place will give us a scope to face less competition and gain an advantage.

- utilizing government incentives- The government incentives like tax and other subsidies policies in different places can be lesser and thus expanding business their can benefit us with low taxation and higher profits.

The mode of business that I will adopt will be indirect exports. This mode has its own advantages that can help the business grow with minimum risks. The benefits of this mode are:

- quick access to markets.

- concentration on resources used for production

- lesser financial commitments

- low risk in expansion and production

- outsourcing exporting lessening management pressure.

- no involvement in processes and regulations of exports.

2. The risks of globalization can be minimized by implementing certain strategies and planning the process and mode of globalizing efficiently. Understanding the market trends, its fluctuation frequencies and the reasons behind the unstable environment is essential. Identifying the correct market and target customers with the right strategies. The laws and regulations of every country are different. For a profitable expansion of business, the government policies have to be clearly understood and implemented in the processes. A proper outsourcing agent who is well aware of the globalized market and procedures of expansion should be acquired in case of indirect exports. All these steps will help the business in mitigating the risks involved in the global expansion of the business.

The external influences that can make an impact on the business can be economic, social, legal, political, technological. The different external influences have their own impacts and outcomes that can decide for the mode and trends the globalization can be done in. Economic trends, ups, and downs in the national incomes, taxation effect the setting up of a business in the country. Social factors such as tastes and lifestyles of customers living their effect the demand and sales too. Legal factors may include the laws and policies that the new business has to abide by for running in the location. technological factors are the advancement in the technologies that the business has to inherit for long sustainability in the market.

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