Product Globalization Case Study

763 Words 4 Pages
Before globalization existed, we were prone to many barriers such as "accustomed difference in national or regional preference"(Theodore Levitt, 1983). According to Theodore Levitt (1983), a company could sell an out of date model in a tier three country back in the days when there was no globalization. One of the positive factors which globalization brings to business is business purchasing impacts. Ken Burnside said that globalization makes the world 's corporation move to third world countries for cheaper labour, and these world class corporations tend to make higher profits as the cost of shipping the finished product overruns the wages and manufacturing costs. As the world gets globalized with more companies moving out to the tier three …show more content…
Product globalization is creating a product to use it in several languages. Market globalization is about products being able to sell out of borders thus, local products are now being able to compete in foreign markets leading to a wider network of markets, which was mentioned by Carol Woods. By having a wider network of markets, the products can be sold more rapidly compared to the times when they were sold only in the local country. However, these companies should consider about foreign cultures before entering into market globalization. It is mentioned by Carol Woods that they should prepare themselves on how to do their marketing in a foreign country as there is a cultural barrier. Globalization also brings a better quality of life. According to boundless that when globalization starts to evolve, the access to external financial assistance such as home loans and cars is given. People are given chances to work abroad rather than in their motherland. Rhoda L Wilburn explained that when globalization trends, there is an imbalance of wealth among nations. He also said that financial leverage of multinational corporation is also one of the main reasons to cause an imbalanced trade environment when trading with developing …show more content…
Grant J. Eldridge made it clear that multinational corporation is a business that has the business running in a foreign country apart from its home country and having the headquarters in major countries. The author also noted that multinational corporation start to arise in countries that do not have appropriate laws where by foreign competition is less competitive in these countries. Moreover they are usually oriented for global profit maximization, both in and outside the home country . At the same time, they do not care about the social or well being of the countries they operate in. However, most of them are investing in certain parts of the world only. He also mentioned that when multinational corporation seeks new markets, they go under three rules. They are “seeking to access new markets: merger with or direct acquisition of existing concerns; sequential market entry; and joint ventures”. “Multinational corporations also make use of a procedure known as sequential market entry when seeking to penetrate a new market” (Grant J. Eldridge). According to the author, they seek access to new markets by making allies with firms that hold a position in the new market. As there is a rapid growth in multinational corporations, fair trade issue is something we need to keep an eye on. Anup Shah (2000) mentioned that fair trade issue is the major matter preventing foreign nation to invest in a

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