Ch08MBA - Chapter 8 Opportunities and Outcomes of International Strategy 1 Identifying International Opportunities Incentives to Use an

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1 Chapter 8: Opportunities and Outcomes of International Strategy
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2 Identifying International Opportunities: Incentives to Use an International Strategy International Strategy: A strategy through which the firm sells its goods or services outside its domestic market Reasons for an International Strategy Potential new opportunities Innovation occurs in home-country market and demand for product develops in other countries Extend product life cycle Secure needed resources Pressure for global integration and globally branded products Global economies of scale High potential demand for products and services Currency fluctuations and tariffs
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3 Identifying International Opportunities: Incentives to Use an International Strategy Four primary benefits Increased market size Can expand size of potential market Domestic market may have limited growth opportunities Larger markets pose less risk for a firm’s investments Greater return on investment (ROI) Large investment projects may require global markets to justify the capital outlays Larger markets are more attractive To generate above average returns on investments
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4 Identifying International Opportunities: Incentives to Use an International Strategy Four primary benefits (Cont’d) Greater economies of Scale, Scope, or Learning Expanding size or scope of markets helps to achieve economies of scale in manufacturing as well as marketing, Can exploit core competencies in international markets through resource and knowledge sharing across borders Competitive advantages through location Can lower the basic costs of the goods or services Access to lower-cost labor, energy, and other natural resources Access to critical supplies and to customers
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5 International Strategies Firms can choose one or both of two basic types of International Strategies: International business -level strategy Follows generic strategies of low cost, differentiation,
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This note was uploaded on 07/31/2011 for the course MAN 6782 taught by Professor Marlin during the Spring '11 term at University of South Florida - Tampa.

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Ch08MBA - Chapter 8 Opportunities and Outcomes of International Strategy 1 Identifying International Opportunities Incentives to Use an

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