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Entry Strategies and Globalization - Essay Example

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The industrial revolution that started in the 19th century changed forever the way business organizations operated in America and abroad. Businesses were able to increase their production a lot which changed the way companies they distributed their products and services…
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Entry Strategies and Globalization
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Entry Strategies and Globalization

The globalization movement provided companies with the capability to realize business with foreign nations. The promotion of free trade among nations has help business organization penetrate marketplaces around the world. Out of the four major market entry strategies the easiest one to implement is exporting. Companies with little experience dealing with foreign markets start off by implementing indirect exporting. Indirect exporting occurs when a company uses intermediaries to facilitate the export of products. For example a company sells 1000 units to retailer such as Wal-Mart and then Wal-Mart sells its products in stores worldwide. The second type of exporting is direct exporting. Direct exporting can be achieved in several ways. A company can achieve direct exporting by establishing an overseas sales branch or subsidiary, by using traveling export sales representatives, and by establishing a domestic export department or division (Kotler, 2003). Exporting is the less risky of the market entry strategies because a firm does not have to invest in a lot resources to achieve market penetration. The second major market entry strategy is licensing. ... Read More
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