Chapter 7: Strategies for Competing in International Markets Learning Objectives

This set of flashcards covers key terms and concepts related to strategies for competing in international markets, facilitating review and understanding before the exam.

Primary reasons for entering foreign markets

To gain access to new customers, achieve lower costs, access low-cost inputs, exploit core competencies, and access foreign resources.

Complexities of strategy making across national borders

Include different home-country advantages, location-based value chain advantages, government policies, economic conditions, currency risks, and buyer preferences.

Diamond Framework

A model used to predict foreign entrants' origins, decide initial market entries, and choose optimal locations for value chain activities.

Advantages of a Greenfield strategy

Provides high control, opportunities for 'learning by doing', and direct transfer of technology and business practices.

Multidomestic Strategy

A strategy that involves tailoring products and services to the needs of local markets.

Global Strategy

A strategy that emphasizes economies of scale and standardization of products across different markets.

Transnational Strategy

A hybrid strategy that seeks to achieve both global efficiency and local responsiveness.

Risks of political instability

Include government instability, corruption, potential nationalization, and internal unrest.

Licensing and Franchising

Low resource strategies that allow rapid market expansion but pose risks of losing control over operational quality.

Export Strategy Disadvantages

Include transportation costs, exchange rate risks, tariffs, and potential loss of channel control.