Global Dimensions in Business

You are a business analyst working at a small domestic organization that produces high-quality baseball bats. Your organization has begun to see its sales flatten in the domestic market. While the organization is not losing money, leadership would like to explore options to continue to grow. One option that leadership has noticed competitors attempting is entering international markets.

You have been asked to examine the benefits, drawbacks, and key considerations for your organization to enter one of the global markets below, and to summarize your findings in a business brief for leadership.

ANSWER

Overview

As sales have flattened in the United States, we want to continue to grow our business and sales globally. The country I have selected for expansion in Canada. I have selected Canada for expansion since the consumer needs and wants are similar to those of the United States. The organization has been experiencing flattening sales in the domestic market. Therefore, despite the fact that the organization is not losing money, there is a need to consider growth. One of the most effective growth options is expansion into the global markets (Ciravegna, Kundu, Kuivalainen, and Lopez, 2019). The business brief is intended for small domestic organizations that need to continue to grow.

Section One: Drivers for Global Entry

Expanding into global markets increases sales and more revenue which can lead to more development (Hopkins, 2017). Global expansion will enable entry into new markets, thus the potential of building a new consumer base. For instance, open borders offer businesses access to more untapped markets. Expansion of the organization into global markets will boost business growth since extending a business into the global footprint means a new audience for the product and service (Flor and Moritzen, 2020). Global expansions will enable the organization to stay ahead of the competitors since they are able to go to a market before their competitors. New visibility and new customers that the competitors might not have may benefit the business by getting it out of a saturated market, thus staying ahead of its competitors. Organizations with a global presence can leverage their understanding of the global markets to build their competitive advantage.

Section Two: Market Profile

Cultural Profile

Political and Economic Profile

Section Three: Market Considerations

Exchange Rates

Legal and Regulatory Considerations

Canada offers a transparent and accessible market for United States products and services. Canadians tend to spend more of their disposable earnings on American services and products. The two countries have great investment ties, with the U.S. serving as the largest foreign investor in Canada. However, Canada has strict regulatory banking as compared to U.S. Canada has low corporate taxes as compared to the United States. Canada has suitable intellectual property protections similar to the United States that reduce the streamlining procedures and administrative burdens. The organization also needs to consider the cultural and social factors since the variations are significant and real. Legal and political factors need to be considered to avoid legal issues and political attitudes which may influence foreign investment (Watson et al., 2018). The attractiveness of the market needs to be examined in terms of potential competition, mode of entry considerations, multinational companies, and the industry dynamics in the prospective market (Brochado, Lobo, Pacheco, and Maldonado, 2020). The organization should examine its capability when going global through an audit of its resources, competencies, portfolio of products, and market knowledge, among other parameters.

References

Brochado, A., Lobo, C. A., Pacheco, L. M., & Maldonado, I. (2020). Drivers of and barriers to the SME internationalization process in a small open economy.

Ciravegna, L., Kundu, S. K., Kuivalainen, O., & Lopez, L. E. (2019). The timing of internationalization–Drivers and outcomes. Journal of Business Research, 105, 322-332.

Flor, C. R., & Moritzen, M. R. (2020). Entering a new market: Market profitability and first-mover advantages. Journal of Corporate Finance, 62, 101604.

Hopkins, R. A. (2017). Growth in Global Markets. In Grow Your Global Markets (pp. 5-11). Apress, Berkeley, CA.

Watson IV, G. F., Weaven, S., Perkins, H., Sardana, D., & Palmatier, R. W. (2018). International market entry strategies: Relational, digital, and hybrid approaches. Journal of International Marketing, 26(1), 30-60.