(Solved Homework): Please answer in paragraph form with at least 300 words. What factors encourage international…

Please answer in paragraph form with at least 300 words.

What factors encourage international expansion?

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(Solved Homework): Please answer in paragraph form with at least 300 words. What factors encourage international…
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Globalization is the process by which the business or organization extend its operations internationally by developing international influence. This is developed by integrating and interchanging the views, products, cultural aspects, etc. internationally.

Conducting business globally is very important and crucial decision made by the business and require lots of effort and correct decisions in order to make it an effective move. It not only provide new opportunities for growth and profit but also provide reputation to business globally.

The factors that encourage international expansion are: –

  • Business will grow by expanding its business in new market because it will broaden the customer base which will increase sales and revenue.
  • Business will achieve economies of scale as company will enter the new market resulting in sharing of cost and risks between markets.
  • It promotes diversification and reduces the exposure of the companies to the economies and political instability.
  • Product or service with unique features and benefits will have less competition in internation markets which will make the company to enjoy massive profits throughout world marketplace.
  • Expansion in international market will help the firm to recover cost of research and development.
  • The companies can access valuable resources and new ideas based on the lifestyle, culture, etc. which can help the companies to develop products or services accordingly.
  • Companies can access cheap and well-trained labor in international market which will help them to reduce labor cost.

The global economy and international business are changing day by day. Conducting business globally or internationally helps in the growth of global GDP, growth of Foriegn direct investment (FDI) and growth in the global value chain system. The international market place will help in increasing the exposure of the business to international customers thus helps the business to grow faster and become a market player for a long-run. FedEx assist the small business to import and export its goods or services internationally.

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