CMN 4105 Lecture Notes - Lecture 8: Factors Of Production, Cost Leadership, Distributed Transaction
12 Apr 2016
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Document Summary
Identifying international opportunities: incentives to use an international strategy. International strategy: is a strategy through which the firm sells its goods or services outside its domestic market: reasons to use this strategy: Increases in global communication facilitate to visualize and model lifestyles in different cultures. Incentives that influence firms to use international strategies (four basic benefits): Following an international strategy is an attractive option to firms competing in domestic markets that have limited growth opportunities. The size of an international market also affects a firm"s willingness to invest in. R&d to build competitive advantages in that market. Larger markets usually offer higher potential returns and thus pose less risk for a: return on investment firm"s investments. Large markets may be crucial for earning return on significant investments, such as plant and capital equipment or r&d. Therefore, most r&d intensive industries such as electronics are international. Recoup investments more quickly due to :
