Basic Strategies & Multinational and Participation Strategies

✓ It could be strategic because, often governments will forbid foreign companies from selling products to its citizens, so as not to take away sales from local industry.

It also requires more of an investment and commitment by the international company which creates a higher risk. There is also the down side of having difficulty managing local resources.

New or increased domestic production of the company 's basic raw materials by other potential producers.

The foreign market must offer a location advantage that makes it profitable to produce the product in the foreign country rather than simply produce it at home and export it to the foreign market. It includes resource endowments, economic and social factors, such as market size and structure, prospects for market growth and the degree of development, labour and input materials costs, the cultural, legal, political and institutional environment, government legislation and policies

Multinational corporations are organizations that work in numerous nations. They likewise help to keep up the worldwide predominance of the Industrialized Nations just by working together sustaining universal stratification. MNC may have a few premiums like overseeing mining operations in a few nations, fabricating merchandise in others, and market its items around the world. The essential recipients are dependably the Industrialized countries, particularly the one in which the multinational partnership has its reality home office. In their quest for benefits, the multinational corporations require helpful power elites at all industrialized countries. The MNC dependably require positive business atmosphere in type of low

International sell and purchase has provided tremendous growth for countries. There are advantages and disadvantages to sourcing overseas. Some of the common advantages to out sourcing overseas are low manufacturing cost and expertise of products (importcrashcourse.com). The disadvantages are language barriers, shipping time, as well as quality of products in some cases. Americans have found comfort in everyday life regarding products that were made in other countries. If Americans were to suddenly not be able to purchase products overseas they may find themselves at a lost for living a typical lifestyle.

There are always advantages and disadvantages to everything. Some advantages of having a National Sales

Off-shoring is the establishment of business operations outside national boundaries. The process of moving business outside these boundaries is to garner an advantage either through tax breaks, lower wages, lower transportation cost and/or relaxed regulations ("Offshore definition," 2014). Many firms either branch out as a horizontal multinational or vertical multinational. Horizontal multinational’s produce the same good or services as abroad. This foreign direct investment (FDI) is done to strategically place production closer to the target market. Doing this provides advantages surrounding transportation cost while enhancing learning associated with local needs. A vertical multinational is one that fragments a portion of its

* A broader capital base gives the company more access to credit which gives the company an option to venture into new business opportunities

WikiMart is a Russian online marketplace operating for Russia and Russian speaking countries. Two Stanford MBA students founded the startup company was founded in 2008, their by two Stanford MBA students with the strategy to reach the young and technologically savvy and young consumers in Russian speaking countries. Twith the founders’ goal of dominating in Russia and other countries of the former Soviet Union is well on its way as WikiMart . that has evolved into a large competitor in the e-commerce industry for that part of the world. The startup company was founded in 2008 by two Stanford MBA students with the strategy to reach the technological and young consumers with the goal of dominating in Russia and other

level of investment, capital, and productivity. This suggests that, in the long-term, an increase in

There are many countries which serve the low switching cost for their raw materials, therefore it will be better to find raw material from another country. Thus the company can serve with low switching cost. For example: Flour, Cheese, butter, Chocolate, etc.

The objective of MNC to operate in other countries is to gain competitive advantage through several ways. Firstly, MNC is able to take advantage of difference in country-specific circumstances. For example, MNC may choose to locate its productions in less developed country like Vietnam to gain cheap labor cost. Secondly,

International strategy has been used by Volkswagen and Suzuki, which involved autonomous subsidiaries. International strategy can be considered an ethnocentric strategy which is characterized by the application of the marketing strategy of the home country to all foreign markets without adaption to local environment (Morschett, Schramm-Klein, & Zentes, 2011). They used the multinational type of strategy, which focused on the local responsiveness. Subsidiaries operated on autonomous or n loose federation. They engaged he contracts to come into partnership of their companies. Also, the study found that the two business people had autonomous of their companies’ progress. They also used shares were bought shares

The advantages of exporting is to avoid the costs of establishing local manufacturing operations but in our case we want to have our own stores in the country because it will make it easier for us to transport our products from our stores to the customers, the second advantage of exporting is that it helps the firm achieve experience effects and location economies and the last advantage is that it has control over manufacturing quality.