Foreign Market Entry and Diversification

Foreign Market Entry and Diversification

Introduction

The success of the companies also increases when the companies expand their businesses or enter into the foreign markets. When the companies continually serves the particular market group and do not bring any diversification, this sometimes give the stress and tough time to the companies. The diversification is therefore necessary particularly for the smaller companies and they are required to serve other products and services categories along with their specialized products and services so that they can sustain in the market.

Entering into the foreign market and providing the diverse customers with diverse products and services increases the growth and sustainability of the company and thus increases the profit margins of the company. Entering into the new and foreign market is not that easy for the companies. In order to cater the new market and to offer them new products and services, the companies are required to consider various factors. The factors ranges from the market economy of the country, the situation of the industry, the existing customers, the needs and requirements of the customers, the potential and the resources of the company in serving the needs and requirements of the particular market in the foreign country.

The General Motors is one of the largest automobile manufacturers around the world. The company has been offering various types of automobiles to different types of customers. The company is offering the range of trucks, sports cars, luxurious cares and other types of cars from long time. The company General Motors has been exporting it various types of cars to other countries. However, the increase in the global competition, and decrease in economic stability of the countries due to the global recession and changing market scenario in United States and around the world, has given many threats to General Motors and due to this reason, the General Motors had great impact upon its profits margins.

Due to increased competition in the market and due to the reason of having greater and stable business and profits, the companies are required to expand their businesses. The General Motors according to its present market situation is also required to expand its business in other countries by offering them different types of vehicles in order to create the diversification and to be affordable by the customers. The following section aims at discussing the strategic actions that the General Motors can take in order to expand its diversified business operations.

Discussion

The company, General Motors should expand its business operations. The strategic actions and the points of considerations that the company is required to undertake are given below.

Argument for diversification

The General Motors can expand its business operations in the relatively lower income countries than that of the United States and other developed countries. As the competitors of the General Motors are not entered into the lower level income foreign markets, this would be the great opportunity for the General Motors. The company can produce diversified motor vehicles according to the income ranges ...