Business Studies

Buyer and consumer Topic 7 Q4
Discuss three potential problems a company can face if it decides to expand internationally. Explain why it is important to consider cross-cultural consumer behavior prior to expanding beyond the domestic market. Provide real-world examples to illustrate your ideas. In replies to peers, discuss additional problems that could be encountered and must be considered.

ANSWER

Challenges of Going International

Doing business internationally is always a worthy endeavor; however, it is always associated with several complications. Any company willing to take its business global must be ready to highlight these issues and design appropriate measures towards curing the problems. Accomplishing these problems of global expansion is important because, without the proper penetration, any strategy or hopes of growing internationally will be impossible. One of the issues linked with expanding globally includes the risk to the existing supply chain (Chen, 2019). Operating a supply chain that exceeds national boundaries is always a significant issue. The particulars associated with exports, imports, and operational logistics are usually affected by global regulations, business deals, and other complicated legislations. For instance, if a business is shipping goods from Asia to North America, it has to cater for both time and cost, including environmental issues.

The second problem linked with going international engages compliance problems. Operating a business in more than a single nation implies dealing with more than a single business regulation. Trade tariffs and taxes are significant barriers to a company that needs proper strategy and experience to operate compliantly. Any business planning to go international must know the specific trading regulations that apply to their processes. Not following these significant laws can stop attempts for a company to expand globally and possibly incquire additional costs for the business (Ferraro, 2021). The third issue is linked with choosing the suitable market entry modes as this involves knowing the right networks. Reaching the appropriate ambassadors for a business is likely to take more time. Going international requires getting the right contact with the appropriate individuals for adequate growth. In summary, the mentioned three challenges affect business more with an effort to go global.

References

Chen, W. (2019). “Going Global” Strategy Research: Explaining the Theory of International Business Theory.

Ferraro, G. P. (2021). The cultural dimension of international business. Prentice Hall.