What Are the Advantages & Disadvantages of Launching a Global Business Effort?

Global business is about serving one region at a time.
Global business is about serving one region at a time. (Image: Photos.com/Photos.com/Getty Images)

Launching into the global market takes planning and preparation, and requires an understanding about the advantages and disadvantages before proceeding into the global business arena. Prior knowledge of the differences in multiple market levels, regions and cultures require marketing research campaigns in each of the communities. Sensitivity to challenges with product, pricing, promotions and logistics are critical parts of successfully launching a global business, using a step-by-step process incorporating the learning curves.


Experience in domestic business can be an advantage to developing the strategic maneuvers for global market entry. Past struggles and accomplishments provide valuable information that should be used in planning for the challenges ahead. Global business factors such as global economics can affect business operations, so can regulations imposed by regional governments. Market perceptions of products and services developed for domestic customers may need a different approach for the global customers and markets.


Expansion may be the biggest disadvantage for businesses entering a global culture dealing with unfamiliar customers, global customs and regional traditions. Management approaches need to overcome all differences implementing a synchronized line of interactions between regional markets and corporate headquarters. Focus and concentration on languages, developing company competitiveness skills, establishing regional relationships, planning storefronts, researching factory locations to support product development and market growth, staffing, training and retraining are necessities.


Cultures have difference mind-sets, becoming competitive, means knowing the market and the customer’s desire, the company's ability to reach out and become part of the community are advantages. Do the research to locate the customer, define the product that attracts the global marketing interest without making major alterations to the brand or quality. Be ready to delivery the product, know the transportation modes available to the individual regions and always follow up with after the sale.


Costs are critical and profits are a must—when considering pricing, be aware of the additional global costs that are required to do business in the regions. Knowing the cost of product ingredients, materials, delivery methods, tariffs, product development, marketing and packaging is an advantage. Be ready to negotiate in the global market, test the waters on pricing and keep in mind that good service builds reputation and trust, which builds repeat customers and profit.

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