Business

Evaluate possible methods of international expansion.

• Exporting.

➢ occurs when a business manufacturers its product in its home nation and sells it in foreign markets.

➢ main aim is to increase sales and profits.

➢ direct exporting happens when a business sells its finished products to a buyer in another country.

➢ indirect exporting usually involves a business selling its goods to an agent or export management company.

➢ intracorporate exporting involves the selling of products or inputs by a firm to its subsidiary in another country.

|Advantages |Disadvantages |

|Allows business to enter overseas market gradually. |Hostile domestic competition overseas. |

|Increase profits and market share. |Number of barriers. |

|Little costs or investment required. |Trade barriers (taxes or quotas) can make the good less |

|The parent company has full control over its subsidiary. |price-competitive. |

| |Overseas agent may not give the marketing support necessary to |

| |stimulate sales. |

| |Exporter must pay transport documentation and customs fees ( lower |

| |profit margin. |

| |Loss of control over product once overseas. |

|Conclusion: despite these...