Please demonstrate critical thinking abilities. No fewer than 250 words for post. Do not summarize the post and/or course concept(s), but perhaps comment on concepts directly applicable to your workplace.
For this response, should outside sources be used to support the content within the postings, proper in-text citations and correctly formatted references should be prepared consistent with the APA (6th edition). The list of references should be physically positioned at the end of the postings.
After reading the text, search for an organization that does not currently do business globally(outside of their home country). What opportunities would international expansion give this organization? List 2 – 3 strategies the organization might use and analyze the benefits and risks associated with each strategy. Justify, why in your opinion, international expansion is or is not a viable strategy for them.
Barnes and Noble does not have any stores outside the United States, although they do ship products overseas. They are not considered a foreign direct investment which is a “direct investment in production or business in one country by a business from another country” (Dyer, Godfrey, Jensen & Bryce, 2016, p. 171). Although Barnes and Nobles may compete with online retail store, Amazon, Barnes and Noble can offer the “experience” of customers visiting its stores abroad. Below are two strategies that Barnes and Noble may use to help consider its expansion:
1. Efficiency (Global Strategy). “Beyond looking at the price of a particular resource, though, companies also have to take into account factors that might increase the cost to use the resource, including labor productivity, and the transportation and communication costs needed to acquire the resource” (Dyer, et al, 2016, pp. 174-175). The benefit would be that stores could be opened on a much smaller scale while still providing an ample amount of products. A risk would be that people living abroad wouldn’t get the “full” store interactive experience with a coffee shop, children’s play area, quiet study areas, etc.
2. Responding to Customers or Competitor (Multidomestic Strategy). “Last, but not least, firms may expand internationally in response to either customers or competitors” (Dyer, et al, 2016, p. 175). As we already mentioned, Amazon is one of Barnes and Noble’s largest competitor. The organization may respond to competitors in order to gain more consumers. Additionally, more people are living abroad and Barnes and Noble may have an opportunity to open its doors to even more consumers. “It doesn’t matter whether someone relocates outside of their home country at age 5 or 45, the experiences gained and the memories retained have a lifelong impact on individuals and their families” (Sandlin, 2016, para. 1). The benefit would be capturing the market audience while understanding what the organization’s are doing as well. The risk would be that the market is consistently changing at a pace where Barnes and Noble may have a tough time catching up to appropriately respond.
If Barnes and Nobles goes forth with their international expansion, I feel that their best bet would be to only open a limited number of stores abroad. As we know, Barnes and Nobles stores are very, very large and opening many stores could be a costly challenge. It may be more efficient to open smaller versions of the retail store while still accommodating the latest and greatest books available on the market.
Dyer, J., Godfrey, P., Jensen, R., & Bryce, D. (2016). Strategic management: Concepts and tools for creating real world strategy.Hoboken, NJ: John Wiley & Sons, Inc.
Sandlin, M. (2016, September 29). On the move: The life-changing experiences of an expat. Chron. Retrieved from http://www.chron.com/news/article/On-the-move-The-…
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