Chapter 10 IB

Flashcards covering the key terms and concepts related to the rationale and strategies for international expansion, due diligence, and market considerations.

International Expansion

The process of expanding a company's presence into foreign markets.

Rationale for International Expansion

The reasons companies expand internationally, such as improving cost effectiveness, exploring new customer markets, and following global customers.

International Due Diligence

The process of assessing foreign markets' potential before entering, including size, accessibility, and costs.

CAGE Framework

A framework used to evaluate countries based on Cultural, Administrative, Geographic, and Economic distances.

PESTEL Analysis

An analytical tool covering Political, Economic, Sociocultural, Technological, Environmental, and Legal contexts affecting a firm's external environment.

Corporate Fit

The degree to which a company's existing practices and resources align with the requirements of a new market.

Institutional Void

The absence of key specialized intermediaries in a market that can raise transaction costs.

Ethics in International Business

The moral implications and practices of conducting business across borders, taking into account different cultural and legal standards.

Supply Chain Diversification

The strategy of spreading supply chain operations across different regions to mitigate risks and costs.

Consumer Behavior in Different Markets

The preferences and purchasing behavior of consumers influenced by cultural and socioeconomic factors.

Global 500 Rankings

A list ranking the world's largest companies by revenue, reflecting shifts in the global corporate landscape.

Market Entry Strategies

Approaches a company may adopt to enter a new market, such as partnerships or joint ventures.

Saturation of Home Markets

A situation where a domestic market becomes oversaturated with competition, leading companies to seek international opportunities.

Mistakes in Market Entry

Common errors companies make, such as underestimating competition or not understanding local market conditions.

COVID-19 Impact on Supply Chains

The pandemic's effects on global supply chains, prompting companies to reassess and diversify their production capabilities.

Regional Differences

Variations in preferences, purchasing power, and cultural attitudes between different areas within a country.

Targeted Value Proposition

A tailored offering that meets the specific needs and preferences of consumers in a new market.

Business Process Outsourcing (BPO)

The practice of contracting non-primary business activities to third-party providers to improve efficiency.