Submitted by: Submitted by jtrau
Views: 354
Words: 880
Pages: 4
Category: Business and Industry
Date Submitted: 10/14/2010 06:46 AM
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...