You are the CEO of XYZ manufacturing company. You have decided that you would like to market your product to Turkey. Consider the following points in your paper; you can make assumptions, but support your work with facts and scholarly references:
o Discuss the reasons why your company would want to expand overseas.
o Discuss what your mode of international business would be and how moving abroad will expand sales.
o How will you minimize risks and acquire resources?
o What are the factors you may face expanding into a foreign market? How might you mitigate those barriers?

Solution
 Details

o Discuss the reasons why your company would want to expand overseas.

Established in 2000 and located in the U.S.A., XYZ is a steel manufacturing company. Home base demand for steel has been successful for XYZ because the company has continuously achieved at least 10% additional increase in sales of its product on a yearly basis. Understanding the trend in today’s competitive market, XYZ realizes that its product needs to be marketed overseas and has chosen Turkey as the nation to expand to. XYZ want to expand overseas to attain global competiveness, grow its customer base, increase sales volume, and take advantage of economic factors in the nation it is expanding to improve its product production (Joseph, 2015).

o Discuss what your mode of international business would be and how moving abroad will expand sales.

Acknowledging that iron and steel is one of the top ten products that Turkey imports (“Top Turkey Imports,” 2014), XYZ has a high degree of confidence that its product would be in high demand for sales. However, to be prudent, XYZ would use exporting as its initial mode of international business in Turkey and monitor its sales increment over two years before deciding on another mode of international business that may call for establishing a production plant in Turkey, establishing a joint venture or licensing. Exporting is a method of shipping or transporting products to an international country for trading.

By using the advantages of exporting: (a) cheaper capital cost of establishing a business in its home-base, (b) accessibility to low-cost quality raw materials for production in a company’s home-base, (c) availability of cheap and skilled labor in a company’s home-base (d) resource of technological advancement in a company’s home-base, and (e) economies of scale of production in a company’s home-based (“The various benefits of exporting,” 2015), XYZ can afford to manufacture and ship its product to Turkey.

o How will you minimize risks and acquire resources?

XYZ will minimize risks by employing exporting mode of expansion because it would have 100% control of its technological know-how, 100% protection of its intellectual property rights, and 100% control of product quality. Majority of XYZ resources are available at low-cost in its home-base while minimal percentage of raw materials are imported from another country that provides lower cost that they would be in the home base.

o What are the factors you may face expanding into a foreign market? How might you mitigate those barriers?

Some challenging factors in global market expansion are: (1) authentic demand for specific foreign product, (2) cultural barriers, and (3) government trade barriers (Media & Hill, 2015). The best way to alleviate these barriers would be for a business owner or manager to perform diligent research of each barrier and device means of dealing with each of them appropriately. For example, by researching Turkey and products that are high in demand in the country, XYZ made the decision to export steel to the nation. Studying the business culture of an international country and comprehending what to do and not to do will alleviate cultural barriers. In addition, government trade barriers can be mitigated by employing an entry mode that aligns with the trade barrier needs.

References

Joseph, C. (2015). Reasons for Expanding a Business. Retrieved from

https://www.ehow.com/info_7917598_reasons-expanding-business.html.

Media, D., & Hill, B. (2015). What Are Some Challenges That Firms Face for International

Marketing? Retrieved from https://smallbusiness.chron.com/challenges-firms-face-

international-marketing-3356.html.

The various benefits of exporting. (2015). Retrieved from

https://www.exporthelp.co.za/modules/1_considering_exporting/benefits.html.

Top Turkey Imports. (2014). Retrieved from

https://www.worldsrichestcountries.com/top_turkey_imports.html.