Global Expansion Strategy: Choosing the Right Path

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Table of Contents

Introduction
Main body
Conclusion
References

Introduction

Running global is one of the options available for companies with resources to support creating subsidiaries in other countries and transforming into a global corporation. Additionally, it might help companies experiencing a decline in revenues because of the emergence of new markets and access to clients. At the same time, firms might face significant risks if the global strategy is selected incorrectly or the conditions and unique peculiarities of a new market are not evaluated. For this reason, for John and Deborah’s corporation, the decision to enter new states can be considered a beneficial one as it might help to boost their revenues. At the same time, it is vital to select the best options and approaches.

Main body

Thus, the corporation trying to enter new regions should establish an effective global strategy. It can be determined as a framework the firm creates to expand into the international market and start operating in new countries (Lasserre, 2017). The choice of paradigm depends on the resources available to the company, its goals, the promotional activities, and the local clients’ demands. For John and Deborah’s corporation, the global approach might be the best option. It implies entering other regions with little changes for other markets, while some aspects might be localized to meet clients’ demands (Lasserre, 2017). It will help the company to possess control over operations and respond to issues when they emerge, which is vital for the brand with its lack of experience in international operations.

The company might select between several countries as the possible options for expansion. First, it might focus on China, which is characterized by the high demand for furniture and people’s growing paying capacity, which is vital for successful expansion (Fortune Business Insights, 2022). Second, Germany can be viewed as a possible option as it is among the top furniture importers with increased attention to sustainably made products (Fortune Business Insights, 2022). Finally, the company might consider entering the Middle-West markets and start operating in the OAE, which is also characterized by the increased demand for high-quality and Western furniture (Fortune Business Insights, 2022). The regions might offer a broad client base and stable income for the company.

Considering the options mentioned above, China can be viewed as the most attractive one. First of all, the demand for furniture continuously grows, and the corporation might benefit from the high level of revenue. Second, the country has a solid resource base, meaning that John and Deborah’s company can use it and replace some manufacturing in the future. Finally, China’s market and economy continue to evolve, which makes it one of the most attractive regions for numerous international companies. It might create the basis for new partnerships and interactions.

Conclusion

Altogether, the choice of a global strategy is an important step for any company that wants to start operating in new regions. For the discussed case, the global approach is the most applicable one as it allows the firm to preserve a high level of control over its operations in new subsidiaries and ensure they respond to problems quickly and effectively. China can be selected as one of the most appropriate regions because of the high demand for furniture and the stable and developing economy. Following the strategy and operating in the selected region, the brand might resolve its issues with the decline in revenue and create the basis for further growth.

References

Fortune Business Insights. (2022). Furniture market size, share & COVID-19 impact, analysis, by material (wood, metal, plastic, and others), category (indoor and outdoor), end-user (residential, office, hotel, and others), and regional forecast, 2021-2028. Web.

Lasserre, P. (2017). Global strategic management (4^th ed.). Springer.

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Global Expansion Strategy: Choosing the Right Path

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