Stages of international market development
Stage 1:
Domestic Operations The firm’s market is exclusively domestic. Eg. Patanjali
have currently its major operations in India Only.
Stage 2: Export Operations The firm expands its market to include other
countries, but retains production facilities within domestic borders. Eg.
Indian firms exporting textiles jute, spices, nuts, rice all around the world.
Stage 3: Subsidiaries or Joint Ventures The firm physically moves some
of its operations out of the home country. Eg. A joint venture between Maruti
(Indian Conpany) and Suzuki (Japanese Company)
Stage 4: Multinational Operations The firm becomes a full-fledged
multinational corp. (MNC) with assembly and production facilities in several
countries and regions of the world.
Some decentralization of decision making is common, but
many personnel decisions are still made at corp. headquarters. Eg. Mc Donalds
is a MNC operating world wide.
Stage 5:
Transnational Operations Firms that reach this stage are often called
transnational because they owe little allegiance to their country of origin.
Operations are highly decentralized, with each business unit free to make
personnel decisions with very loose control from corp. headquarters. Eg.
Coca-Cola, Nestle.
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