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Why do businesses try to go global?

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egordon6 | Student, Undergraduate | (Level 1) Valedictorian

Posted November 22, 2012 at 1:37 AM via web

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Why do businesses try to go global?

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thanatassa | College Teacher | (Level 2) Educator Emeritus

Posted November 24, 2012 at 9:00 AM (Answer #1)

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Businesses try to go global in many different ways for different reasons. First, businesses develop global supply chains in order to reduce costs. Next, businesses try to market their products or services globally because the world is a far bigger market than any one region. Next, businesses globalize when they reach market saturation in their own country. Another strong reason for globalization is as a sort of hedge against declines in specific local markets. Right now, for example, markets in the developed world are just emerging from a global recession and are generally stagnant and major growth is occurring in emerging economies, and so it makes sense for businesses to diversify globally.

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