Description
Discuss the primary factors that motivate companies to expand internationally.
Instructions:
You must have a minimum of two academically reviewed journal articles sourced from the CU library to support your answer.
Please use full APA throughout (use in-text citations and a APA reference list). Post your responses in the body of the discussion area. DO NOT INCLUDE A WORD DOCUMENT.
introduction ,content ,conclusion follow this
Explanation & Answer
Attached.
Primary factors that motivate companies to expand internationally
According (Dimitratos, Buck, Fletcher & Li, 2016) there are many reasons why companies are
motivated to expand internationally. The primary factors that motivate companies to expand
internationally include: economies of scale, risk diversification and marketing opportunities.
First, many companies seek to enjoy the economies of scale the reason why they are motivated to
globalize their company. In this case, economies of scale grants the companies an opportunity to
enjoy global advantages that economize the global transportation and distribution networks.
The other primary factor that motivates companies to expand internationally is risk
diversification. Being that different countries possess different risks, companies do not like the
idea of exposing their businesses to the same risk. In this regard, companies are motivated to
spread their risks internationally.
Finally, marketing opportunities motivate companies to expand globally. In this case, many
opportunities such as absence of competition abroad, trends changing to favor the product in
foreign markets and the demand for a firm's product in foreign markets motivate companies to
expand globally (Dubravska, Mura, Kotulič & Novotný, 2015).
In conclusion, there are many factors that motivate companies to expand internationally but the
primary factors include: economies of scale, risk diversification and marketing opportunities.
Reference
Dimitratos, P., Buck, T., Fletcher, M., & Li, N. (...
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