Unformatted text preview: time, Clear Vision sought foreign eyewear companies specializing in fashionable, high quality design to broaden its product line. Objective: product differentiation
► Clear Vision invested in factories in Japan, France, and Italy STRATEGY in INTERNATIONAL STRATEGY in INTERNATIONAL BUSINESS Example: Clear Vision
► ► Clear Vision responded to threats and opportunities in the international marketplace by developing strategies to increase profitability through value creation.
Today, Clear Vision is an MNE with over $100 in gross annual revenues. ►
► ► ► Threat: lower cost imports from foreign competition
Response: lower costs by shifting manufacturing to a lower cost location
Threat: competition from highend market segment and need to increase perceived value of eyewear
Response: achieve differentiation and increase perceived value Advantages of Global Expansion
Advantages of Global Expansion Expanding globally allows firms to increase profitability in ways that are not available to purely domestic enterprises. The international environment can offer:
► Leveraging products and core competencies ► Location economies
► Cost economies from experience effects
► Leveraging subsidiary skills
► Profitability is constrained by product customization and the “imperative of localization”. Localization: adjustment of one or more elements of product marketing or distribution to fit the particular idiosyncrasies of a national market. EXPANDING THE MARKET: LEVERAGING EXPANDING THE MARKET: LEVERAGING PRODUCT AND COMPETENCIES
►A company can increase its growth rate by taking goods or services developed at home and selling them internationally Returns from such a strategy are likely to be greater if
indigenous/local competitors in the nations a company
enters lack comparable products enters
►Success of multinational companies also rest upon the core competencies that underlie the development, production, and marketing...
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This document was uploaded on 02/26/2014.
- Spring '13