BUS 478 Lecture Notes - Lecture 7: Protectionism, Ethnocentrism, Beer In Canada
14 Sep 2016
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Decided to expand internationally to attract new customers. The company should allocate resources for marketing and distribution channels. Increased market size, especially when targeting mainstream consumers. Greater returns on major capital investments, new products or processes. Greater economies of scale, scope, or learning. Matured in one market can be novelty in a different market. Both benefits domestically made products because they reduce foreign competition. Each business must develop a competitive strategy focused on its own domestic market. The home country of operation is often the most important source of competitive advantage. Allows a firm to pursue the strategy into markets located in other countries. Companies with either high technology and/or marketing-based resources are better equipped to internationalize than more traditional manufacturing companies. Smaller home markets and large production capacities favor internalization. Firms with key managers well networked internally are able to accelerate the internationalization process.
