Why An Indian Firm Should Globalise?
(a) Profit Advantage: ‐ Though the margin of profit in the international market is low due to intense competition, it certainly increases the overall profitability of the orgainisation due to economies of scale.
(b) Growth Opportunities: ‐ Global market is spread all over the world. The enormous
growth potential of many foreign markets is a very strong attraction for domestic companies to globalise.
(c) Domestic Market Constraints: ‐ Some companies may globalise in order the avoid constraints in the domestic market. For example, saturation of the domestic market.
(d) Competition:‐ Liberalisation and globalisation of Indian economy has increased competition
from foreign MNCs. Hence, in order to survive intense competition, Indian companies will have to globalise.
(e) Government Policies And Regulations :‐ The incentives and assistance provided by the government and encouraging EXIM policy for internationalization may also initiate globalisation.
(f) Spin‐Off Benefits: ‐ Globalisation provides certain spin‐off benefits, viz., greater market share, economies of scale, easy access to imported capital goods, etc.
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