Going International American businesses are
part of a global economy regardless of how large and small they may be.
Companies such as McDonald’s see expansion into new foreign markets as a primary
strategy for boosting sales and profits. McDonald’s expands through various
means from building company owned outlets to licensing and partnership
agreements. McDonald’s is but one US company that has found domestic sales
slowing due to saturated (饱和) domestic markets, thus leaving it little choice
about how to increase earnings. PepsiCo is another US company that is pursuing
overseas markets to overcome a less than satisfactory 4 to 5 percent domestic
sales growth. In general, companies go international for two
basic sets of reasons: proactive and reactive. Proactive motives include the
search for new customers, new markets, increased market share, increased return
on investments, needed raw materials and other resources, tax advantages, lower
costs and economies of scale. This last reason, economies of scale, encourages
companies to find foreign partners to share the costs connected with building
factories, conducting research, and expanding one’s sales and presence in
additional markets. The drive to reduce costs has led to setting
up operations in countries with lower wages and fewer restrictions on business.
Many businesses from around the world have chosen northern Mexico for its
nearness to American customers and lower wages and benefits -- on average one-
fourth to one-fifth those of the United States and Japan.
Reactive motives include the desire to escape from trade barriers, and
other government regulations, to better serve customers and to remain
competitive. Nearly every major foreign producer of automobiles has established
subsidiaries (子公司) in the US to escape American trade restrictions. One example
is Mercedes-Benz with its manufacturing operations in Alabama.
The desire to escape government regulation is not limited to automobile
manufacturers. Japan’s largest cosmetics maker, the Shiseido Company, is
planning to invade US and European markets in response to government actions.
Shiseido had long enjoyed a comfortable dominance of Japan’s $14 billion-a-year
cosmetics market. Lack of strict antitrust law (反垄断法) let it keep retail prices
high, while import regulations shielded it from cheap foreign products. Not
since 1995, Japan has clamped down on Shiseido’s business practices and
deregulated cosmetics imports. Shiseido has now to enter foreign markets. The passage mainly discusses ______ for businesses going international.