International Expansion And Vertical Integration

Recent progresses in the international business literature note down that multinational enterprises (MNEs) have a tendency to be more regional than global, in terms of width and strength of their market covering, and that the majority of their international action is conduct within their home regions. In agreement with the regionalization theory, this suggest that the responsibility of intra-regional expansion is much lower than the responsibility of inter-regional expansion; that is, the LOF is higher if entering into other globe area relation to expanding within the home area. on one hand some studies argue that threat diversification benefits from worldwide expansion are restricted when multinational firms follow concerted regional strategies, due to similarity in economic basics and exposure to common threat factors within the sections. On the other hand, other studies focusing on MNEs which is account a linear positive influence of intra-regional diversification on implementation. According to these studies, cost economies and effectiveness benefits are more probable to occur throughout intra-regional expansion, due to home region resemblances in terms of geography, economics, organizations and policies, and spatial closeness. despite the fact that low to moderate level of inter-regional diversification give up a positive profits to MNEs, higher level of inter-regional diversification consequence in diminishing

Tata Motors Limited is India 's largest automobile company, with consolidated revenues of Rs. 92,519 crores (USD 20 billion) in 2009-10. It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles with winning products in the compact, midsize car and utility vehicle segments. The company is

There are five international expansion strategies, which are common in social media. Straight extension finds “no change in product and no change in promotion” (Spirou, 2016). This strategy is most often desired because if a company has a strong brand image, they don’t always feel like they need to invest their money in new strategies. The product adaptation “changes the product but not the promotion…[increasing] likelihood of success as products are adapted to culture” (Spirou, 2016).

For example: Two firms doing the bakery business merged and expanded their business in bakery.

The company should seek to adopt a market expansion approach, which could help in sustaining it in the global markets.

1. Philip Austin’s plan for European expansion is very simplified and will rely mostly on the foreign intermediary to complete export and complete sales transactions. I believe that this is the main problem of this expansion plan; there is too much liability in someone outside of the company that possibly doesn’t share the same goals and objectives of the company and sometimes is not completed committed with the process.

It may also be known as Market Extension. It includes the pursuit of more market segments or geographical regions. With existing products developing new markets, company should focus on different consumer’ demand who has the same kind of product demand in different markets. It can be possible through further market segmentation in order to help identify a new clientele base. It is necessary to adjust the product position, sales methods and promotion. For example, exporting the product to the new countries; changing new product dimensions or packaging way; innovating new distribution channels and the other innovation. Nonetheless, they do not need to change the core technology of the product itself. I would like to give an example; there are some leading cosmetics companies like Dior, Chanel, and Lancôme that have entered into international markets for expansion. And they do not end their steps to continue to expand their brands through new global markets. Certainly, facing the smaller enterprises, it is better to implement this strategy into another market where its product without currently

It may also be known as Market Extension. It includes the pursuit of more market segments or geographical regions. With existing products developing new markets, company should focus on different consumer’ demand who has the same kind of product demand in different markets. It can be possible through further market segmentation in order to help identify a new clientele base. It is necessary to adjust the product position, sales methods and promotion. For example, exporting the product to the new countries; changing new product dimensions or packaging way; innovating new distribution channels and the other innovation. Nonetheless, they do not need to change the core technology of the product itself. I would like to give an example; there are some leading cosmetics companies like Dior, Chanel, and Lancôme that have entered into international markets for expansion. And they do not end their steps to continue to expand their brands through new global markets. Certainly, facing the smaller enterprises, it is better to implement this strategy into another market where its product without currently

For firms seeking growth, overseas markets represent new market segments, which they may be able to serve with their existing range of products. In this way, a company can stick to producing products that it is good at. Finding new overseas

Diversification and adapting to internationalisation is a way to survive in a competitive business environment and is well researched and adopted in the business world. It is possibly the most logical and secure way for companies to avoid that their share of a given market will not be taken over by other competitors when they try to diversify technologically, geographically or product wise. It also helps reduce the risk by spreading it into different markets.

Business Strategy approach: - this is based on the idea of Pragmatism (Welford and Prescott, 1994) with the company making trade-offs between a number of unstable decision to internationalize and the way it adopts to do so Reid (1983) argues that foreign expansion is contingency based and

Cooperative agreements between two or more firms from different countries to participate in a business activity – WILL BE COVERED MORE IN DEPTH LATER

Global companies like P&G, J&J, IBM, GE, Pfizer, Cisco, Tata & Sons, Mahindra & Mahindra, Haier, Lenovo, HSBC among others, have all adopted M&A strategy. Some authors say that organizations rely on three mechanisms to achieve growth: organic growth, alliances, and mergers and acquisitions (Rosinski, 2011). Other authors have proposed five ways of international expansion, in increasing order of cultural risk: (1) the greenfield start, (2) the international strategic alliance, (3) the joint venture with a foreign partner, (4) the foreign acquisition, and (5) the cross-national merger (Hofstede et al., 2010).

Developing new products for old customers using new technology. This is called horizontal diversification strategy.

There are different ways in which companies can expand their activities to gain some sort of competitive advantage. Internationalization is understood as the process of incremental involvement in a country different from the one where business usually happens. The reasons for companies to seek international expansion vary (Morschett 2007):