Page 64 - GLOBAL STRATEGIC MARKETING

• International involvement is spurred on by the growth of global
competition. Companies need to take the lead in technological

development, research and development (R&D) and distribution,
aiming to succeed in gaining a market share on a worldwide scale.

• The desire to diversify and spread the risk over a wider geographic
area can also be a motive for entering the international market.
Recession in one country can be counterbalanced by growth in
another. An example of a company recognising this is Gerber, which,

when the birth rate declined in the US, expanded its baby food
operations in Mexico, where the birth rate is rising.

• The development of communications technology and electronic
information is a powerful driver to getting involved overseas. The
improvement of international telephone networks in developing

countries, email, computer networks, teleconferencing, fax, satellite
and international courier services makes fast inter-country
communication possible. Conducting business between New York

and Jakarta is almost as easy as doing so between New York and
Los Angeles.

• Improvements in transport systems and physical logistics have also
encouraged the expansion of international operations. An
improvement in cargo shipping makes transporting raw materials

cheaper and quicker.

• The advances in computer aided design enables engineers in
different parts of the world to work together in designing products or

a production system.

• The development of a global market infrastructure has also been a
motivation for overseas involvement, and contributes to easy

management of operations on an international scale.

• Involvement overseas is made more attractive by the expansion of
financial institutions such as Citibank, which have long traditions of

international operation and extensive international networks.