Question

Discuss why companies go international, give specific reactive and proactive reasons.

Answer 1

Globalization is the process through which companies expand their operations to an international scale catering to the markets globally. From last many years with the ease of free trade and doing business in the countries across the world which maximizes the interaction between states, countries and people through the development of international flow of ideas, culture and money as well. Below are the specific reactive and proactive reason for companies to go international:-

Reactive reasons:-

• International competition
• Customer demand
• Trade barriers

Proactive reasons:-

• New international market
• Resource access
• Cost saving
• Seeking economies of scale
• To overcome limited expansion opportunities